Helping (usually new) People Choose Their Wallet(s)

[Pmalek]

That's why I usually recommend newbies non-custodial wallets with beautiful UI like BlueWallet and OWNR.

A beautiful UI shouldn't be a priority when selecting a crypto wallet. BlueWallet doesn't have a desktop version - it's mobile-only type of wallet. That's why it can't be compared with clients that do have desktop wallets, like Electrum. + You can connect your Electrum client with a hardware wallet, something that you can't do with BlueWallet.

If you are using the Lightning Network wallet of BlueWallet you are wrong with the non-custodial part. It's a custodial wallet.

OWNR is a closed-source multi-currency wallet. Why would this app be better than Coinomi for example? Electrum is again the better option for those looking to store bitcoin on a software wallet.   

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[LoyceV]

Thermal paper can last a while, but yes I do see your point.
They also make micro sized inkjet printers.

Maybe I should change my opinion on this matter I just searched for "micro printer" on Aliexpress, and it shows many different thermal printers. Ink jet won't be good either as they usually dry out. This would be a very fun project for boring lockdown days. The fun factor is more important than keeping the paper for decades.

A beautiful UI shouldn't be a priority when selecting a crypto wallet.

Let's face it: most people would choose the good-looking wallet over an ugly wallet.

If you are using the Lightning Network wallet of BlueWallet you are wrong with the non-custodial part. It's a custodial wallet.

I only use BlueWallet for the (custodial) LN part (I use Mycelium for mobile on-chain storage). I don't care that it's custodial, because I only keep small amounts in it, and it just works better than opening my own channels. Besides, it's a wallet, not long-term storage. People store billions on exchanges, so I really don't mind storing a few bucks in a custodial wallet. I think I have about 40 euro worth of LN in it now, and another 25 in (non-custodial) Phoenix Wallet. I make more off-chain transactions than on-chain nowadays, but the total value transfered is lower.
A custodial LN wallet has benefits too: to deposit, I create a new LN wallet to get a new address. It's good for privacy, and I don't need to open another channel every time.

[o_e_l_e_o]

-snip-

Fair points. It's not just the vulnerability itself which makes me wary of Trezor products, though, but also their response to it. They have very much tried to down play it, saying that everyone should be using a passphrase anyway and so the attack doesn't matter, when they know full well that only a minority of advanced users use passphrases, and only a minority of them use a passphrase which is long and complex enough to match the security of a seed phrase. Nowhere on their main website does it tell people they should be using a passphrase, and nowhere in their new user set up guide does it tell people to use a passphrase. That doesn't reassure me that they would be open and honest about other critical vulnerabilities.

If your use case of a hardware wallets is as cold storage which you only ever use in the privacy of your own home, then sure, this attack vector is incredibly unlikely. But if your use case is carrying it with you everywhere you go and frequently using it in public to buy goods and make transactions, then this attack vector potential makes them more risky than a simple mobile wallet.

[DaveF]

A beautiful UI shouldn't be a priority when selecting a crypto wallet....

Beautiful, not a priority.
Useable for someone who getting crypto for the 1st time. Yes.
Too many have poor UIs, or useless documentation / error messages.

If it's rock sold secure, 100% open source, and non custodial that's great.
But, if the UI is useless and when there is an issue you get a box that says "error #6 contact developer" who takes 2 days to respond then sorry, I'll be recommending Coinomi over it.

I have been using a RPi as my cold storage for years now. I've found it sufficiently secure for my use but I'd like to have another layer of security. Arguably, it's similar to a RPi as it does act like an airgapped wallet so if anything that should theoretically give me more security over my existing set up.

Please tell me you have many backups of your seeds. I have had the microSD cards just die now and then. Even more in RPi units that have their entire read / write on them.


-Dave

[ranochigo]

Please tell me you have many backups of your seeds. I have had the microSD cards just die now and then. Even more in RPi units that have their entire read / write on them.

I do. For some reason, my Raspbian randomly wipes my entire Electrum instance every now and then. It's quite annoying to be restoring it from the seed every now and then, the entire wallet file just disappears. Not a big issue but just very annoying.

[LoyceV]

For some reason, my Raspbian randomly wipes my entire Electrum instance every now and then. It's quite annoying to be restoring it from the seed every now and then, the entire wallet file just disappears.

I'd have a hard time trusting a wallet that does unexpected things. Other than that, a simple script could restore a backup when it's gone.

[ranochigo]

I'd have a hard time trusting a wallet that does unexpected things. Other than that, a simple script could restore a backup when it's gone.

Well, as far as I can tell, there isn't anything wrong with the ISO or the source code that I built it from. I'll try to debug it and see if I can find anything when I have the time. It has happened to me less than 10 times and I'm thinking that it could've just been something wrong with the SD card.

[malevolent]

Fair points. It's not just the vulnerability itself which makes me wary of Trezor products, though, but also their response to it. They have very much tried to down play it, saying that everyone should be using a passphrase anyway and so the attack doesn't matter, when they know full well that only a minority of advanced users use passphrases, and only a minority of them use a passphrase which is long and complex enough to match the security of a seed phrase. Nowhere on their main website does it tell people they should be using a passphrase, and nowhere in their new user set up guide does it tell people to use a passphrase. That doesn't reassure me that they would be open and honest about other critical vulnerabilities.

If your use case of a hardware wallets is as cold storage which you only ever use in the privacy of your own home, then sure, this attack vector is incredibly unlikely. But if your use case is carrying it with you everywhere you go and frequently using it in public to buy goods and make transactions, then this attack vector potential makes them more risky than a simple mobile wallet.

I think they downplayed it because there is nothing short of designing a new device from scratch for them to do. Three clicks, trezor.io -> trezor wiki -> Security -> first link, are needed to know that using a passphrase is essential to get maximum security. At least they admit themselves they don't talk enough about passphrases: link.

I'm not concerned about them hiding other vulnerabilities because the product is too popular and too many people, their competitors included, would have gladly taken the opportunity to talk about them.

In practice simple mobile wallets with malware is what leads to people losing their bitcoins, not hypothetical attacks where a thief saw someone with a Trezor and decided to steal one to extract a seed before the owner manages to find their seed backup because he saw a Defcon/Blackhat conference talk about Bitcoin hardware wallets and put in the work to learn how to extract the seed And that's assuming the owner doesn't only keep pocket change on their 'main'/decoy wallet without a passphrase.

[o_e_l_e_o]

I think they downplayed it because there is nothing short of designing a new device from scratch for them to do. Three clicks, trezor.io -> trezor wiki -> Security -> first link, are needed to know that using a passphrase is essential to get maximum security.

I agree that is why they have downplayed it, but I think doing so is inherently untrustworthy. How many newbies do you think read through the Wiki and find that page? And how many of the tiny number who do appreciate the risk from not using a passphrase, since Trezor doesn't actually mention the vulnerability specifically on that page? Nowhere in their set up guide for new users (https://wiki.trezor.io/User_manual:Setting_up_the_Trezor_device) are passphrases even mentioned. You have to dive deep in the "Advanced features" pages (https://wiki.trezor.io/User_manual:Advanced_settings) before passphrases are touched upon, but again, they make no specific mention of the vulnerability.

If they wanted to maintain trust, then this vulnerability should be spelled out in plain English on the new user set up guide - "Warning: Your Trezor device is vulnerable to physical attacks unless you use a passphrase".

In practice simple mobile wallets with malware is what leads to people losing their bitcoins, not hypothetical attacks where a thief saw someone with a Trezor and decided to steal one to extract a seed before the owner manages to find their seed backup because he saw a Defcon/Blackhat conference talk about Bitcoin hardware wallets and put in the work to learn how to extract the seed

Sure, but you could say the same about hypothetical $5 wrench attacks, and yet everyone is (rightly so) very angry about the Ledger database hack. Just because other attacks are more likely doesn't mean these vulnerabilities can be ignored, especially not by Trezor themselves.

[bob123]

If they wanted to maintain trust, then this vulnerability should be spelled out in plain English on the new user set up guide - "Warning: Your Trezor device is vulnerable to physical attacks unless you use a passphrase".

And if they want to maintain Sales, they better not mentioned that everywhere.

I mean.. after all it is a company. Their goal is to make money. Losing sales because mentioning there is a hardware vulnerability (which the majority of customer wouldn't even understand) is a bad move from their point of view.
The majority of people store their mnemonic code online in their email inbox or on a cloud anyway.. This vulnerability probably won't lead to tons of coins being stolen.

I definitely understand them not mentioning it everywhere.

[DaveF]

So...I screwed up a bit...
Yesterday I had to PM Hhampuz to change the payout address for me in the campaign I am in that he is managing.

Hey Dave!

Updated the addy, what did you do?  

Best,
Hhampuz

I have to leave my phone with security when I go into certain areas for one of our clients. Nothing exciting just legal records but, they don't want you to be able to take pictures.

Was moving BTC when the guard came to escort me in and I left my phone with at the guard station.....unlocked and with the wallet authenticated. Just dropped it in the tray and walked away. Total idiot move. Anybody at the guard station could have gotten to the private keys in about 10 seconds.

That's why I am always saying don't leave more funds in a mobile wallet then you are ready to loose. Because sooner or later you are going to screw up.

I'm 99.999% sure it's safe. To be sure I am going to move everything out later hopefully when fees drop a little overnight.

-Dave

I guess that brings up the next point; we have to make to new users are drill into their heads, you are usually your own worst enemy.
No harm done, except I lost a bit in TX fees since I had to move BTC for no reason when fees were higher, but still. I have my phone protected with pin & fingerprint. I have the app protected with and different pin and I still could have lost money.

And if I didn't realize that *I* left everything unlocked when I handed the phone over, and I did loose money, I would have been wiping the phone and going insane trying to figure out how the hell it happened.

-Dave

[o_e_l_e_o]

I definitely understand them not mentioning it everywhere.

Oh, don't get me wrong - I perfectly understand why they have done it, and keeping the vast majority of their customers unaware about the vulnerability is definitely the best thing for their business. But for me it is still an inherently untrustworthy thing to do, and I can not and will not continue to support a company which does it. Just like Ledger trying to downplay the fact that 270,000+ names and addresses were leaked - obviously it is good business sense, but that doesn't mean I'm going to buy their reasoning or excuses.

This vulnerability probably won't lead to tons of coins being stolen.

It will be interesting to see what happens when it does. If a person can prove that their coins were stolen by a vulnerability which Trezor knew about and did not inform the customer of, then they may well have a pretty strong case. I have no idea what the Czech Republic laws are about this kind of thing, but I understand that EU laws contain some pretty strong consumer protection legislation.

Anybody at the guard station could have gotten to the private keys in about 10 seconds.

Which mobile wallet do you use, out of curiosity? And which wallets could have prevented this, i.e. by requiring re-entering your PIN when you try to make a transaction or view a private key, even if the wallet app is already open? Electrum, for example, requires you to re-enter your password when on desktop, but on mobile you do not need to. Seems like a bit of an oversight now that you mention it.

[LoyceV]

Which mobile wallet do you use, out of curiosity? And which wallets could have prevented this, i.e. by requiring re-entering your PIN when you try to make a transaction or view a private key, even if the wallet app is already open? Electrum, for example, requires you to re-enter your password when on desktop, but on mobile you do not need to. Seems like a bit of an oversight now that you mention it.

Mycelium only asks for a 6-digit pin. That takes one million tries to get it, and anyone with physical access to the device could (theoretically) write a script to crack it.
I also did CPFP once on Mycelium, and to my surprise it didn't ask for my PIN again. So it remembered, which I don't like.

Just to be sure, I wouldn't trust anyone with physical access to any device holding crypto (even when locked).

[DaveF]

Anybody at the guard station could have gotten to the private keys in about 10 seconds.

Which mobile wallet do you use, out of curiosity? And which wallets could have prevented this, i.e. by requiring re-entering your PIN when you try to make a transaction or view a private key, even if the wallet app is already open? Electrum, for example, requires you to re-enter your password when on desktop, but on mobile you do not need to. Seems like a bit of an oversight now that you mention it.

Yes it was Electrum. And although memory is a tricky thing I thought it used to ask for the pin again before displaying the mnemonic even if unlocked. But I have been though so many wallets over the years I could be wrong.

Just to be sure, I wouldn't trust anyone with physical access to any device holding crypto (even when locked).

Good in theory, not always going to happen in reality.
I *have* to give up my phone when going into the records room. So either I leave it with the guards or in my car or in the office.

Leaving it in the office is not really an option, because I do need it (and it's 4g hotspot) when working. If I know I am just going to this one client and back it might just be an option but then I am out of contact with work till I find Wi-Fi for my laptop.

Leaving it in my car is possible, but still now it's sitting unattended someplace.

Which goes back to what I have also said, don't keep more on your phone then you are prepared to loose. Phones in and of themselves are not secure.
Now with this latest bull run I have WAY more money on the phone then I should have across all the wallets. But that is another issue and yet again on me for not moving it.

-Dave

[o_e_l_e_o]

Yes it was Electrum. And although memory is a tricky thing I thought it used to ask for the pin again before displaying the mnemonic even if unlocked.

It's been a while since I actually used Electrum on mobile, but after a bit of experimentation it seems if you hit the menu button at the top right, go to "Settings", and set a PIN, then it will ask for this PIN in all your wallets prior to making a transaction, displaying a private key, or displaying your seed phrase. Although a six digit PIN isn't exactly amazing in terms of security (only ~20 bits of entropy), it's better than nothing, and would probably have protected your funds in this scenario should someone have gone poking around on your device.

I *have* to give up my phone when going into the records room. So either I leave it with the guards or in my car or in the office.

Best practice in that case would be to ensure your phone encrypts data at rest (most modern phones do this by default, some will require you to enable it) and to ensure you always turn your phone off before you leave it with someone else.

[DaveF]

It's been a while since I actually used Electrum on mobile, but after a bit of experimentation it seems if you hit the menu button at the top right, go to "Settings", and set a PIN, then it will ask for this PIN in all your wallets prior to making a transaction, displaying a private key, or displaying your seed phrase. Although a six digit PIN isn't exactly amazing in terms of security (only ~20 bits of entropy), it's better than nothing, and would probably have protected your funds in this scenario should someone have gone poking around on your device.

Yeah, I see that now. I just assumed (I know don't assume) that setting was for the pin when you opened the wallet.

I *have* to give up my phone when going into the records room. So either I leave it with the guards or in my car or in the office.

Best practice in that case would be to ensure your phone encrypts data at rest (most modern phones do this by default, some will require you to enable it) and to ensure you always turn your phone off before you leave it with someone else.

It does, it's fully encrypted and it locks when I hit the power button. But as I said, it was a 100% brain freeze.
I was moving BTC while waiting. Guard came to get me just as I was checking to see if it confirmed. Did the polite "Happy new year. how is everyone?" thing and I just dropped the phone in the security basket and walked in. Same way I have done it dozens of times before. Just didn't hit the power button.
I realized it the moment I made it to the back of the records storage. Just didn't matter at that point. Either it had auto locked after 2 minutes or they had access.

-Dave

[Dabs]

My "hardware wallet" is an old laptop or an old phone.

If your phone is old enough not to have any gyroscope sensors on board, that's fine, otherwise, the fingerprint of your way of walking (which is as individual as the retina of the eye)   is  for a long time in the databases of  numerous watching  agencies so that your physical identity is linked to that mobile.

If you're using a phone as a hardware wallet, it's probably air gapped, so any identity linked to that particular phone will tend to be useless. All they'll see is it got factory reset then suddenly stopped being used months or years ago.

If you're not air gapping your cold storage or at least one of the signatures for a multisig, then it's not cold storage.

I was moving BTC while waiting. Guard came to get me just as I was checking to see if it confirmed. Did the polite "Happy new year. how is everyone?" thing and I just dropped the phone in the security basket and walked in. Same way I have done it dozens of times before. Just didn't hit the power button.

It's good to be proactive and move the coins after that incident, but guards normally don't really care about anything except that which they were assigned to protect, which in this case, is the records room.

What I would think about, maybe not immediately, but some time later, is how much do I know about these guards, or how much do they know about me, are they generally good people ... reset the phone wallet because it's your protocol for breaking your own protocol, when following someone else's physical protocol, without assuming the morality or integrity of the person you left it with.

I lot of the guards I have dealt with tend to return items I have left (either by accident or intentionally). Phones, wallets, bags, firearms ... but that was back when bitcoin wasn't very well known.

[Karartma1]

But I've resorted to using old android phones permanently offline running Electrum as a pseudo-hardware wallet.

You can use two phones, one has a watching wallet, and the other one is permanently offline. They use QR codes to transfer data. You sign the tx on the offline wallet.

If you implement some encryption method (e.g. using android encryption which is activated by default since android 6.0 i believe), you already got a proper air-gapped wallet setup running.
This is definitely more secure than a hardware wallet but comes with less convenience.

If you are fine with the extra steps it takes to send transactions, there is no good reason to switch to a hardware wallet besides mobility and/or faster access.

Ok, wait for a second here as I'll show you my old setup and tell me how good that was.
I was using a SamsungGalaxy S9: no root, updated to the latest manufacturer firmware, no biometrics ever activated and encrypted from the start (I guess using samsung knox).
The only point of using this phone was to have bitcoin in it. At the time I was using Samourai Wallet (and after a look at walletscrutiny.com I started having some doubts about it). Never used any other app and deactivated all the bloatware.
To watch the holdings I was using Sentinel (SW companion watch only app).
How secure that was?

[o_e_l_e_o]

I was using a SamsungGalaxy S9: no root, updated to the latest manufacturer firmware, no biometrics ever activated and encrypted from the start (I guess using samsung knox).

Did you perform a factory reset on it before you started? Did you keep it permanently airgapped?

When you say you "guess using samsung knox", it sounds like you didn't actually encrypt the wallet, but just relied on the phone not allowing access to data after startup until you enter your password/PIN. If I'm not mistaken, Samsung phones can have their login screen disabled from your Samsung account in case people forget their password/PIN, so that's not exactly secure. Better to use a proper encryption program.

Where did you store the phone when you were not using it?

Did you keep the device airgapped even when making transactions?

[acquafredda]

Interesting, if I get this right it is possible to create some sort of nice set-up using commercial phones. I mean this is good because everyone uses phones these days and with proper due diligence we could basically hide a fortune almost in plain sight. I will look more into it and see how this discussion develops.
Sometimes the best hiding place is the one that is in plain sight, really!