The new durable paper wallets
Tuesday 27 May 2014
Most of us know about the paper wallet but there are a few new products on the market that take bitcoin cold storage to the next level. Mike Ward takes a look at some of the latest storage options that won't go soggy in a flood.
Cold storage solutions are simply ways of storing value such that the value is not accessible from any online computer. Generally speaking the idea is to trade your dependence on computer and network security for a reliance on physical security measures, which are better understood and less complex.
The simplest example is the classic "paper wallet" which consists of a piece of paper with a private key and public address printed on it. Printing a QR code or two on the paper is not a bad idea either. Do it yourself paper wallets can be produced at the BitAddress.org website. Simply save the file to a thumb drive and load it on a machine which is not on the network. Generate a wallet there and print onto paper. As you can probably guess from that description these are susceptible to theft. Whether the thief takes possession of the paper, or simply takes a photograph of the private key or the QR encoding of it, they can then spend the money from that paper wallet.
Secure Paper Wallets
There are more sophisticated variants of this simple scheme which offer better protection against theft. Specifically, any scheme which allows you to "break up" your private key into multiple, perhaps even redundant pieces will let you use more than one sheet of paper to store these chunks.
There are tricky ways to do this, and then there's the old reliable "tear the paper in half" method. Regardless how exactly this is done, it allows you to store them separately, and requires an attacker to have possession of more than a single piece of paper in order to spend from your wallet. However, physical damage can be a major issue for paper wallets. They are particularly vulnerable to all manner of weather-related threats such as water damage and fire.
At Bit-Card.de they offer a paper wallet product with some really attractive designs and fancy security holograms covering the private key. They produce an eye-pleasing, more durable plastic card version of the traditional paper wallet and in the last year have produced an encrypted card, which does not allow your private key to be known by them or any third parties.
More Durable Paper Wallet Options
The good folks at CryptoCards.ca sell a Crypto Card that's made from scratch-resistant anodized aluminum, available for a variety of coins. Their process correctly requires you to generate your encrypted private key on your own and upload it. This eliminates the need to trust them with your private key, as well as trusting them to keep their server and software secure, etc. The keys and QR codes are etched into the surface of the card, so it's significantly more durable than paper. Anodized metal is resistant to rust and corrosion, so unlike paper these will not be ruined by exposure to water. These are probably not going to survive a fire, but of course the paper and plastic alternatives won't either.
Finally there is the Cryo-Card from the labs of Cryobit. This is a high-tech solution designed by their chief scientist Cody Maher, an aerospace engineer by training. It's a credit card sized brushed metal device with your public key and QR code on the front, and your encrypted private key displayed on back.
Like the Crypto Cards, you must generate and encrypt your private key before sending to them, so there's no danger of exposing this. It is never recommended to allow anyone else to have access to your private key, since that alone allows spending from the corresponding public address.
We're going to go easy on the materials science behind this product. Suffice to say that instead of scratching a pattern into the outer layer of metal, a ceramic glass substance is chemically bonded to it. The base metal for the Cryo-Card is aerospace grade AMS 5524 Stainless Steel designed to be anti-corrosive and scratch resistant as well.
According to Maher, "To scrape off or remove the ceramic used to produce the QR codes with chemicals or abrasion you would need to remove the layer of metal beneath the ceramic as well." And Cryobit claims on their website that this card is heat resistant up to an amazing 2500℉ (1370℃).
The company has another product ready for launch which is a gold colored Cryo-Coin designed for the same purpose. Maher claims they are gearing up for a Dogecoin version of the Cryo-Card, ready for sale in as little as a couple weeks. The bottom line for paper wallets at this point in time is that they remain a good idea if, and only if implemented with a secure strategy. Simply printing pieces of paper and stuffing them into your dresser drawer is not sufficient security for any significant amount of bitcoin. Consider instead a durable form factor like the Cryo-Card that will withstand what mother nature can unleash, and is of no use to would be thieves since the private key is encrypted.
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