Cypherbox Wallet - self-custody, lightning, mobile

[Bamskki]

Cypherbox was just pushed to v0.1.7 (Android build 35, iOS build 18).

The following highlights what they did.

They upgraded  Ark wallet engine and made the emergency exit process safer.Besides, refreshing/consolidating your funds got smoother, and you now have the option to add extra randomness (dice/coin rolls) or a BIP39 passphrase when creating or recovering procedure. They also fixed yhe fallback issue for fee estimates in CoinOS, cleaned up the Strike login flow, dropped 32-bit Android support (which in turn fixes the launch crash).

WOW thank you so much for these updates Satscraper!

Yes we just uploaded a new build to TestFlight ready to download. iOS and Google Play submissions are pending for review.
https://github.com/CypherBoxLLC/Cypher-Box/releases/tag/v0.1.7-vc35

This version makes the Bark wallet much more user-friendly. Just make sure you receive above 700 sats from lightning, and above 50K sats from onchain, and batch refresh dust VTXOs when their total amount exceeds 500 sats. Also, please fund your unilateral exit fees in advance, reserve about 20K-100K sats depending on your risk tolerance for the edge case where onchain fees suddenly spike. Currently the unilateral exit doesn't deliver a full protection against the ASP going down (wallet doesn't open if ASP is down, small fix will be added in the next release).

[satscraper]

Cypherbox release was elevated to v.0.1.8.

The biggest fix in it is about "emergency exit" , namely, feature that lets you pull your money out of Ark if something goes wrong.

It also checks the blockchain far less often while waiting, so it uses way less data, and it shows more honest, accurate messages about fees, exit progress, and payment status instead of confusing or wrong info.

[Bamskki]

If you miss Boltz, Cypher Box can do non-custodial swaps between onchain and Lightning using the new Bark vault http://cypherbox.io

No channels, no liquidity management, KYC-free

Fees are often cheaper than Boltz, roughly 0.2% to 0.5% paid to the ASP. (No fees from our side)

The tradeoff is speed: Ark settles on an hourly round, so a swap takes up to an hour + on-chain confirmation time.

On-chain to Lightning requires a minimum of 50,000 sats.

Lightning to on-chain has no minimum. Only the network fee applies, and it is deducted from the amount you move.

Super easy; download app > tap receive > choose onchain or lightning > funds arrive as a VTXO > tap send > Paste lightning invoice or onchain address

Correction: a Lightning to onchain swap via Ark isn’t trustless at the receive step. LN-in is an ASP-issued arkoor so the “sender” is the gateway, and “sender + ASP don’t collude” assumption is just “trust the ASP.” Refresh the VTXO first; then the onchain exit is actually self-custodial.​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​

An onchain to Lightning swap is fully trustless.

[satscraper]

Cypherbox release was elevated to v.0.1.9.0

With this update app mixes your dice rolls with the  random number  generated by phone RNG to prevent the weak set of rolls along from being contributed to SEED. It also blocks lazy patterns like tapping one face repeatedly,

[internetional]

I tried out this wallet today, and I immediately ran into difficulties. 

First, I decided to transfer 333 sats into it from my other Bark wallet (Arké). The funds were debited from Arké but never arrived in Cypherbox. Only after that did I notice that under the Bark protocol, the Cypherbox wallet requires a minimum deposit of 700 sats. Fair enough, that's on me - I missed it. It actually is displayed prominently. I was just being careless. Still, it's strange that such restrictions are in place. Other Bark wallets (Noah, Arké, OZark) don't have these limitations. 

Next, I tried to receive funds in Cypherbox via Lightning. I specifically generated an invoice for 701 sats so that the incoming funds wouldn't turn into non-refreshable dust. I paid the invoice, but two VTXOs appeared in the wallet instead: one for 389 sats and another for 312 sats. Each of them is a dust VTXO that must be spent within two days, or it expires. I transferred them to Noah, which doesn't have these limits, and decided to hold off on using Cypherbox for now. 

Given that the Cypherbox wallet is technically capable of handling VTXOs under 700 sats, I find it even harder to understand why it refused to accept the 333 sats from Arké. After all, it could have at least credited them as a non-refreshable dust VTXO!

[Bamskki]

I tried out this wallet today, and I immediately ran into difficulties.

First, I decided to transfer 333 sats into it from my other Bark wallet (Arké). The funds were debited from Arké but never arrived in Cypherbox. Only after that did I notice that under the Bark protocol, the Cypherbox wallet requires a minimum deposit of 700 sats. Fair enough, that's on me - I missed it. It actually is displayed prominently. I was just being careless. Still, it's strange that such restrictions are in place. Other Bark wallets (Noah, Arké, OZark) don't have these limitations.

Next, I tried to receive funds in Cypherbox via Lightning. I specifically generated an invoice for 701 sats so that the incoming funds wouldn't turn into non-refreshable dust. I paid the invoice, but two VTXOs appeared in the wallet instead: one for 389 sats and another for 312 sats. Each of them is a dust VTXO that must be spent within two days, or it expires. I transferred them to Noah, which doesn't have these limits, and decided to hold off on using Cypherbox for now.

Given that the Cypherbox wallet is technically capable of handling VTXOs under 700 sats, I find it even harder to understand why it refused to accept the 333 sats from Arké. After all, it could have at least credited them as a non-refreshable dust VTXO!

Thank you so much for taking the risk to try our new Bark vault and we're very sorry to hear you had this experience.

The error is most probably from Arké or the ASP, not Cypher Box. The 701 split into 389 + 312 was not us. We request a single invoice for the full amount and leave every output setting at the server default.

Also, in Bark vault you CAN receive amounts less than 700 sats, the warning is merely cosmetic so that you dont end up with unrefreshable dust capsules. If you insist on receiving even 1 sat, the payment should arrive. Moreover, if you hold 2 dust VTXOs in which their sum is above 500 sats, a warning will appear with a DUST REFRESH button that combines your dust capsules and refreshes them in one batch, you didn't see it?

What does Arké or you other lightning wallet report for that send, delivered or still pending and how much? If it says delivered and we showed nothing, tell us and we will dig in.

[internetional]

The error is most probably from Arké or the ASP, not Cypher Box. The 701 split into 389 + 312 was not us. We request a single invoice for the full amount and leave every output setting at the server default.

Also, in Bark vault you CAN receive amounts less than 700 sats, the warning is merely cosmetic so that you dont end up with unrefreshable dust capsules. If you insist on receiving even 1 sat, the payment should arrive. Moreover, if you hold 2 dust VTXOs in which their sum is above 500 sats, a warning will appear with a DUST REFRESH button that combines your dust capsules and refreshes them in one batch, you didn't see it?

What does Arké or you other lightning wallet report for that send, delivered or still pending and how much? If it says delivered and we showed nothing, tell us and we will dig in.

Just in case, I tried to fund the wallet via an LN invoice once again. I created another invoice for 701 sats, paid it, and again received two dust VTXOs: this time for 267 and 434 sats. I saved both invoices: the first one, which resulted in 312 and 389 sats, and this one.

Code:

lnbc7010n1p4fd6wqsp5mjn5ksezuk6n56a270j7pnkxapzr5ex6pgudl49kxv2y4pr4l2uqpp5kt406anu27azzq7erte9hz6k3vuuwyavh4smjkfy68933dz8420qdqqxqy9gcqcqzxg9qyysgq8xasw47hf6mtezsu48ev63le3dvmx69g0ut9tur9k824t37mmsqh2vs9dy77hj806kzq575lqqx5mf2ztpmxssefgv8psxhzdrcvaysp3v2f3y

Code:

lnbc7010n1p4fd7qesp5fmkjdkq469a2520v6a97s346dmstxqrx73zzf9945tyedgdlm96spp5v6325y0kncyplk88crpc2jqdazqx24e79yghjczksykucr2xjhxqdqqxqy9gcqcqzxg9qyysgqcjp6ynxcwdh60cep5ky47303j02u5x5r8e6jdhgv0m09kzj09q95enheu9nqcagxwyevk26sa07vfagcrxdalctcpuymlwgphptpv6qqa0gxa0

If you could check why paying each of them resulted in two VTXOs, please do! I would be curious to understand this. Because so far, it seems that LN payments into the Cypherbox wallet are unreliable. They can turn into non-refreshable VTXOs. Yes, I see that they can be merged into a single refreshable VTXO (with a fee), but they are not refreshable by default.

As for the 333 sat payment from Arké, it went through the Bark protocol, not Lightning. In Arké, this payment disappeared from the transaction history, and this VTXO's current status is "Locked". However, I suspect that the root of the problem lies within the Arké wallet, not Cypherbox.

[Bamskki]

This seems like an ASP issue.

Because so far, it seems that LN payments into the Cypherbox wallet are unreliable.  

Small correction so our users don't freak out: LN payments into the Cypherbox's Bark vault might be unreliable (assuming this isn't an ASP issue).

Cypher Box app contains other wallets that you can still receive lightning payments into normally such as Coinos and Strike.

We will investigate the issue of lightning payments to Bark being split into two VTXOs with Second.tech team and get back to you.

[internetional]

Yesterday, I tried once again to transfer an amount of less than 700 sats from Arké to Cypher Box via Bark, and this time the transfer was successful: 267 sats were debited from Arké and appeared in Cypher Box as a non-refreshable VTXO. 

And I noticed one big advantage of the Cypher Box interface. When I have VTXOs whose value is less than the minimum refreshable amount, Cypher Box always warns that there is dust in the wallet that cannot be refreshed and should be spent as soon as possible. In Noah, Arké, and Alby Hub, there is no such warning, and you only find out that your VTXOs were too small and couldn't be refreshed after a failed refresh attempt. 

I used to think it would be better to transfer such VTXOs from Cypher Box to Noah because they would be automatically refreshed there. However, today I realized that's not the case at all: other wallets also cannot refresh small VTXOs, but they don't inform you about it in advance. Cypher Box is much more useful in this regard. What's more, it actually has a button in the interface that lets you merge all the dust VTXOs together and thereby refresh them. I haven't found such a button in any other wallet.

Bamskki, is there a possibility to add a feature to select which dust VTXOs get consolidated for a refresh? Right now, you can only refresh all VTXOs in the wallet simultaneously. As I understand it, the refresh fee depends on the VTXO's expiration date. If, for example, three dust VTXOs expire tomorrow and one expires in 28 days, it would make sense to consolidate only the first three.

[Bamskki]

Confirmed from Second.tech, it's a ASP design choice:

"Lightning receive is facilitated using a pool of VTXOs with different sizes. Similarly to how arkoor works, instead of combining multiple inputs into one output, we instead bundle VTXOs together to make a payment. That's what your user experienced here."

- Peter from Bark

So we need to rework the dust refresh around this issue and also study the issue you raised about dust refresh selection so batch refreshing discards fresh dust. Yes we currently prioritise cleaning the vault from dust even if it's uneconomic.

And I noticed one big advantage of the Cypher Box interface. When I have VTXOs whose value is less than the minimum refreshable amount, Cypher Box always warns that there is dust in the wallet that cannot be refreshed and should be spent as soon as possible. In Noah, Arké, and Alby Hub, there is no such warning, and you only find out that your VTXOs were too small and couldn't be refreshed after a failed refresh attempt.
Other wallets also cannot refresh small VTXOs, but they don't inform you about it in advance. Cypher Box is much more useful in this regard. What's more, it actually has a button in the interface that lets you merge all the dust VTXOs together and thereby refresh them. I haven't found such a button in any other wallet.

Exactly, that's what I said earlier in this thread. No amount of fancy automation and UI/UX will make self-custodial Bitcoin vaults in general "feel like banking wallets" nor they should. We chose to let users manually control their UTXO and VTXO capsules, hopefully intuitively with clear instructions and visualisation, as opposed to hiding this responsibility behind automated mechanics that cause more harm and confusion than good in the long run.

Let's see how we can improve dust management in the next release. Thanks!

[Bamskki]

Hey,
We just uploaded a new release 0.1.10

Bamskki, is there a possibility to add a feature to select which dust VTXOs get consolidated for a refresh? Right now, you can only refresh all VTXOs in the wallet simultaneously. As I understand it, the refresh fee depends on the VTXO's expiration date. If, for example, three dust VTXOs expire tomorrow and one expires in 28 days, it would make sense to consolidate only the first three.

You're correct, the fee depends on expiry: on mainnet it's 0.5% with 28 days left and free in the last 2 days. For dust that works out to about 2 sats, though, and a dust VTXO can't refresh on its own, so leaving one out just strands it until more dust arrives. The app now folds dust together automatically. For regular VTXOs, where the difference is real money, you can already refresh them individually.

New features:
- Dust VTXOs worth combining are now folded into one automatically. That covers Lightning receives that arrive in several small pieces: the ASP pays receives from its VTXO pool, so one receive can land as two sub-500 sat VTXOs, and they now get swept together with any other dust.
- Dust that is too small to combine now offers two more ways out: Quick top up Bark from Coinos by just enough to make the dust batch viable, or, quick sweep to CoinOS.

Many people are wondering after the Liquid fiasco whether Bark really is "self-custodial" and we thought we would share with you our review and how you can verify:
https://x.com/Cypher_Box/status/2097795470772846739

[satscraper]

We just uploaded a new release 0.1.10

Today this release with version code 0.38 was updated to new 0.39 which can be classified as the small fix update bearing same version number but new build. The screenshot blocker is now off by default. They also cleaned up the home screen layout, removed a pink line on some screens, and made the dark background consistent everywhere including the splash screen. The notification permission popup now only shows after it explains what it is for, instead of popping up during wallet setup. Under the hood they fixed the bug where incoming lightning payments could be filtered out of the app

[satscraper]

Fresh Cypherbox  release, namely 0.1.11 (versionCode 40).

Just main changes showing it is worth to update:

It fixes the bug where restoring your wallet from just your seed phrase did nothing, even though the app claimed it should work.

It also fixes the emergency exit system so it no longer skips capsules that are close to running out of time, which was happening right when people needed exit the most.

The app also talks to the blockchain much less often now, cutting requests by a lot, and it stops wasting time retrying providers that never worked in the first place.

On top of that there are small interface fixes and clearer numbers in the guide about refresh fees.

[Bamskki]

GM,
it's definitely worth updating but not because of some scary bugs that just got fixed, Satscraper
 

It fixes the bug where restoring your wallet from just your seed phrase did nothing, even though the app claimed it should work.

This is a feature with fixes. The new feature: you can recover with seed only without the backup file.  The app didn't claim seed-only restore worked, it told you the opposite. Six places said a seed alone could not restore Ark funds, and separately the recover button was wired to nothing. Both were fixed with an added feature of seed-only recovery so it becomes compatible with Noah.

It also fixes the emergency exit system so it no longer skips capsules that are close to running out of time, which was happening right when people needed exit the most.

The hard limit is unchanged: capsules genuinely too close to expiry are still refused, since an exit needs roughly 26 hours minimum and starting one with less means losing the capsule and the fees.

What changed is the rule above it. It excluded anything under about four days because near-expiry capsules are usually the deep, expensive ones to exit, so a one sat refresh beats a costly exit. True of the group, but it was applied per capsule and ignored depth, so shallow capsules that were cheap to exit and far from their timelock got discarded too. Those now get through when they are both comfortably clear of their own runway and worth more than the fees.

[Bamskki]

I will share with you here some tips on how you can use Bark vault economically along with your cold storage vault.

But first, you have to understand what Ark is because it's not a "trustless" system. Ark is better described as “escapable custody”, than “self-custody”.
You are holding a claim against a shared UTXO that an operator assembled and can later reclaim if you fail to renew (refresh) your exit before expiry.

Second, get familiar with fees:
- Receiving from Lightning
0%, free. The capsule you receive still has to be refreshed to extend its life by about 28 days, and that costs the refresh fee below.
- Sending Bark-to-Bark
0%, free.
- Refreshing:
Free with under 2 days left, 0.2% from 2 to 7 days, 0.4% from 7 to 14 days, and 0.5% with more than 14 days left.
A fresh capsule lasts about 28 days, so refreshing one that still has most of its life left costs the most. Waiting for a reminder is cheaper than refreshing on sight.
- Sending over Lightning
0.2% to 0.5% of the amount, with a 20-sat minimum.
- Withdrawing on-chain
0.2% to 0.5% of the amount, plus standard Bitcoin network fees.

Example: How to accumulate 1M sats over 10 weeks and withdraw it to cold storage:

Alex adds 100K sats at the end of every week for 10 weeks, then withdraws the full 1 million sats to cold storage. Using the fees above:
Receiving: free
Free over Lightning or on-chain.
A Lightning deposit arrives as a short-lived capsule, good for only a few days. The wallet refreshes it straight away to buy the full 28 days.
Because the fee tracks the time left on a capsule, that first refresh is a cheap one: free if the capsule arrives with under 2 days on it, otherwise 0.2%, about 200 sats per 100K deposit. Ten deposits, about 2,000 sats. Refreshing a second time right after pays the 0.5% band, because by then the capsule has its full 28 days again.
Keeping them alive: about 1,400 sats
After that, a capsule only needs refreshing once every 24 days, and refreshing at the reminder costs 0.2%, or 200 sats per 100K. Across the 10 weeks that is 7 more refreshes.
Withdrawing: 2,000 to 5,000 sats
0.2% to 0.5% of the 1M sats, depending on how much life the capsules have left, plus a few hundred sats of Bitcoin network fee.
Total: roughly 5,500 to 8,500 sats
About 0.55% to 0.85% of the 1M sats UTXO going to cold storage.

That first refresh on each deposit is automatic and unavoidable, otherwise the capsule expires within days. The later ones are where Alex has a choice, and two habits keep him at the low end: let the reminder tell him when to refresh instead of refreshing on sight, and time the withdrawal for when his capsules are in their last week rather than just after a refresh.


What we've built in Bark Vault differs from other Ark apps (even the ones that use Bark SDK) because every part of it has to stay in balance: refresh timing, fees, automatic triggers, reminders, exit mechanics and dust handling.

Lean too far toward safety and you pay more fees. On mainnet, refreshing a capsule with four weeks left cost 0.5%, against 0.2% with two and a half days left.
Lean too far toward saving fees and a capsule can expire, or run out of time for an emergency exit.

Automate everything and you're trusting background wake-ups that phones don't guarantee. Even a refresh the server does for you has to be checked by your wallet the next time you open it.
Make everything manual and you need to know rules nobody should have to learn, like the fact that one dust capsule in a refresh might make the server reject the whole round. (this was a behaviour observed in previous Bark versions)

So Bark Vault puts you in control but tries to guard the edges:

Dust never joins a refresh, even when you pick it by hand. The wallet folds dust into one capsule once it's worth it.
The wallet refreshes on its own when you receive, when repeated sends make your change too deep, and in a capsule's last week, but never when a stuck round could cost you your exit.
Five reminders before any capsule expires, scheduled on your phone so they don't depend on a server reaching you.
Every capsule is checked before an exit: can it finish in time, and is it worth the fees? You can override the fees, never the timing.

My engineering philosophy building Bark Vault was:
Manual control is a habit we teach. Automation is the safety net. When they conflict, we priorities safety of funds, not user control.

[internetional]

- Receiving from Lightning
0%, free. The capsule you receive still has to be refreshed to extend its life by about 28 days, and that costs the refresh fee

I don't want to pay for the automatic refresh of VTXOs received via Lightning. I would prefer to refresh them manually two days before expiration. Does it make sense for me to keep using a wallet version where automatic refresh upon receipt was not yet implemented? Or were there any critical vulnerabilities discovered in that version that were patched in later releases?

If there are no serious vulnerabilities, what was the last CypherBox version that accepted Lightning transfers without forced VTXO renewal? Was it 0.1.9 vc37?

Is a backup from that version compatible with newer wallet versions? If I ever need new features, can I upgrade the wallet, complete a few transactions, save a backup, and then uninstall the new version and restore the old one using the backup made in the newer release? Or would it be safer to use two devices for this - one running the old version and the other running the new one - and transfer funds between them?