keepkey: shapeshift different than chrome app!

[stevenc88]

I just got a keepkey and following the instructions, set it up with ShapeShift.

According to a receive bitcoin address I generated on ShapeShift, I determined that it follows the BIP49 (Segwit compatibility) format, with a derivation path of m/49'
I transferred some bitcoin to the wallet, and it showed up in the ShapeShift website just fine.

I then loaded the chrome app "KeepKey App" which is from "keepkey" and it correctly discovered my keepkey wallet. After authenticating with my pin, the BTC balance was 0!
According to a receive bitcoin address I generated with the KeepKey App, I determined that it follows the BIP44 (Standard) format, with a derivation path of m/44'

Obviously these are two different wallet interpretations.

Is this correct? I would expect the official KeepKey App and the now official ShapeShift site to see the same addresses.

Any comments?

[1715023266]

1715023266

[1715023266]

1715023266

[1715023266]

1715023266

[o_e_l_e_o]

There are three main derivation paths, and any hardware wallet is capable of generating addresses under any or all 3 simultaneously. The addresses generated are entirely separate, and so any bitcoin visible under one derivation path will not show up under a different derivation path. It is entirely normal, therefore, that the balance of your m/44' addresses will be zero despite depositing coins to your m/49' addresses.

The three different derivation paths are as follows:
m/44'/0'/0'/0/0 - P2PKH addresses, also known as "legacy" addresses, which start with a "1"
m/49'/0'/0'/0/0 - P2SH-P2WPKH addresses, also known as "nested segwit" addresses, which start with a "3"
m/84'/0'/0'/0/0 - P2WPKH addresses, also known as "native segwit" or "bech32" addresses, which start with "bc1"

Using your KeepKey with ShapeShift will always use the m/49' derivation path, and therefore always generate nested segwit addresses starting with "3", while the Chrome App will always use the m/44' derivation path, and therefore always generate legacy addresses starting with "1". This is explain in their post here: https://medium.com/shapeshift-stories/segwit-enabled-for-keepkey-746c914a37d9. As I mentioned above, these two sets of addresses are entirely separate.

If you want to use a single piece of software to interact with all your addresses (including native segwit), then you could look in to using your KeepKey with a wallet such as Electrum. There are instructions on doing so here: https://keepkey.zendesk.com/hc/en-us/articles/360001453430-Electrum-Integration-with-KeepKey


Edit:

Shouldn't that be p2wpkh?  Is that a typo, or have I been mistaken?

Typo. Fixed, thanks.

[DireWolfM14]

I've owned a keepkey for almost a couple of years now, and found that both of their native apps leave much to be desired.  I've since moved one to another brand, but before that I used the keepkey almost exclusively with Electrum.  Electrum is the only way to access your Bech32 addresses.

One security warning I should pass along; the keepkey shouldn't be used without activating a Bip39 Passphrase.  Any of the three apps mentioned will be able to do that.

m/84'/0'/0'/0/0 - P2PKH addresses, also known as "native segwit" or "bech32" addresses, which start with "bc1"

Shouldn't that be p2wpkh?  Is that a typo, or have I been mistaken?

[stevenc88]

... the Chrome App will always use the m/44' derivation path, and therefore always generate legacy addresses starting with "1". This is explain in their post here: https://medium.com/shapeshift-stories/segwit-enabled-for-keepkey-746c914a37d9. As I mentioned above, these two sets of addresses are entirely separate.

Thanks for the reference. That page clearly explains the limitation of the Chrome App - I hadn't seen that page before, and was surprised as the different operation between the app and the ShapeShift web portal.

If you want to use a single piece of software to interact with all your addresses (including native segwit), then you could look in to using your KeepKey with a wallet such as Electrum. There are instructions on doing so here: https://keepkey.zendesk.com/hc/en-us/articles/360001453430-Electrum-Integration-with-KeepKey

I use Electrum as my primary wallet (on my Windows 10) and I like it a lot. The instructions you referenced show setting it up only for the m/44'/0'/0'/0/0 - P2PKH addresses, so I would still be missing the M/49' addresses (AFAIK Electrum only handles one derivation path per wallet). So I would set up multiple wallets to see all my coins (I do that with another wallet I initially created with the Coinbase Android app, which seamlessly supports all 3 paths).

By the way, this is my first hardware wallet. When using it with Electrum, it appears the only benefit is that I never entered my 12-word phrase into Electrum - the KeepKey handles that. Otherwise the Electrum software does the same thing it does with my other software wallets, correct? Is that the only benefit of a HW wallet, keeping the private keys off of the computer?

Thanks for the help!

[o_e_l_e_o]

The instructions you referenced show setting it up only for the m/44'/0'/0'/0/0 - P2PKH addresses, so I would still be missing the M/49' addresses (AFAIK Electrum only handles one derivation path per wallet).So I would set up multiple wallets to see all my coins

Correct. There is no way to be able to load all your addresses in to the same wallet whilst maintaining the protection of a hardware wallet, so you have to set up three separate wallets, one for each derivation path.* On the instructions I linked to, on the screenshot which shows picking "legacy (p2pkh)", you simply pick the other derivation paths to create those wallets.

When using it with Electrum, it appears the only benefit is that I never entered my 12-word phrase into Electrum - the KeepKey handles that. Otherwise the Electrum software does the same thing it does with my other software wallets, correct? Is that the only benefit of a HW wallet, keeping the private keys off of the computer?

Essentially, yes. As a side effect of keeping your private keys off the computer, any transactions have to be signed on the device, which means you get an extra security step of manually confirming the transaction on your hardware wallet's screen prior to it being made. This can help protect you against clipboard and other malware.


*You can set up a wallet which will let you view all your different addresses in the same wallet. This is called a watch only wallet. You would do so by importing the addresses or the master public key from each wallet in to a new wallet, but such a wallet won't let you spend anything from those addresses - you will need the normally set up wallet (as in the instructions I linked to) to do that.

[HCP]

Thanks for the reference. That page clearly explains the limitation of the Chrome App - I hadn't seen that page before, and was surprised as the different operation between the app and the ShapeShift web portal.

That's due to the Chrome App being developed by the original KeepKey devs before the company was then sold to ShapeShift. ShapeShift then developed their web portal which kind of pushes users into registering and using ShapeShift and it's fees

However, as an existing Electrum user, you're in a good position to be able to leverage that as a frontend for your KeepKey so you get the benefits of all it has to offer with the added security of a Hardware Wallet.

[stevenc88]

... and using ShapeShift and it's fees

Previously, I was using Coinbase as my Fiat->BTC exchange. But it looks like ShapeShift's fees are actually lower.

For example, if I want to purchase $500 of BTC:

• Coinbase fees: $7.34
• ShapeShift fees: $2.50

It looks pretty good to me.

Are there any other fees that I am not aware of?

[HCP]

I was talking more about the transaction fees associated with sending BTC... I will admit I haven't looked in a while, but previously fees for transacting via ShapeShift were fairly high (and fixed) in comparison with being able to manually set fees in Electrum.

Things may have changed.

[stevenc88]

I was talking more about the transaction fees associated with sending BTC.

Understood. I do like the flexibility of setting the fee with Electrum.

My only problem with the Windows Electrum app is that I have to run it as administrator in order for the app to recognize the KeepKey HW wallet. This is a known issue with the app. But otherwise, I love the flexibility in configuring the wallet (you can define the derivation path manually).

My favorite Android wallet is Coinomi. I only wished it worked with the HW wallet.

[HCP]

My favorite Android wallet is Coinomi. I only wished it worked with the HW wallet.

Have you tried Mycelium? That appears to have KeepKey support built in... but I've only ever used it with Ledger Nano S and Trezor ONE.

[o_e_l_e_o]

For example, if I want to purchase $500 of BTC:

• Coinbase fees: $7.34
• ShapeShift fees: $2.50

The 1.49% fee (or however you have calculated it) for Coinbase is the fee you pay when you make an instant buy using the standard Coinbase site, as per their fee schedule here: https://help.coinbase.com/en/coinbase/trading-and-funding/pricing-and-fees/fees.html.

If you instead switched over to using Coinbase Pro and placed a market order, you would only pay a fee of 0.5%, as per their fee schedule here: https://help.coinbase.com/en/pro/trading-and-funding/trading-rules-and-fees/fees.html. Coinbase Pro also has free bitcoin withdrawals.

ShapeShift essentially charges a 0.5% fee built in to their exchange rate. Which of ShapeShift or Coinbase Pro works out cheaper will depend on the exchange rate and market prices offered at the time.