The requirements for the best Bitcoin wallet?
This article discusses a checklist or requirement list for the best bitcoin wallet. For the readers who do not have a lot of time to read, we start with a short summary:
The best Bitcoin wallet should be an easy to use plug-and-play wallet for everyone. It should combine the highest security of cold storage with the convenience of an online software wallet. The wallet should not have any possible third party risks concerning your private key. It should contain the private key on cold storage under your control. It should contain at least one secret hidden wallet. It should be a 100 % hacker, malware and theft proof Bitcoin wallet. Even if the wallet backup is stolen, the bitcoins ought be safe! Only a few hardware wallets in combination with a proper wallet seed backup security solution are recommended: Trezor, Ledger Nano S and the Digital Bitbox. The Digital Bitbox is a extremley secure Bitcoin hardware wallet developed in Switzerland. It meets all the requirements discussed below:
The requirement's list for the best bitcoin wallet:
- In order to achieve this, is it extremely important that the private keys never touch your computer or the internet.Not even during the initial setup or backup. So we should look for a hardware wallet with an onboard microcontroller that generates a wallet (BIP32) using a high-quality hardware random number generator to create entropy.
- Furthermore, there should be a more convenient and secure way to deal with the offline backup and recovery of a wallet. The best Bitcoin wallet should include an onboard slot for a micro SD card that allows offline backup and recoveries where there is no need to expose. The backup process of many wallets is vulnerable for rootkits and spyware. While typing and verifying your recovery wallet seed on a keyboard or displaying recovery information on a screen, you leave it susceptible to theft by key logging, screen captures, and cameras. With a micro SD card dealing with the secured storage of your wallet seed, you avoid these risks. Moreover, unlike other hardware wallets, you are able to backup your wallet at anytime and as often as you like. Switch between different wallets in a snap. This way multiple (cold storage) wallet backups can be saved to the same SD card - each filename should be time stamped to be unique. Also, the same wallet backup can be saved to multiple SD cards. As such creating multiple backups is easy to realize for large value wallets.
- An important feature would be that the backup functionally should be equivalent to an encrypted wallet but better if done on the following way... Technically, the backup is a string of characters that is the wallet's seed. The seed in combination with the device password is used to derive the wallet's BIP32 extended master private key. Different from decrypting an encrypted wallet, the derivation purposely takes a lot of computational time, which greatly reduces the possibility to brute force attack the backup. This would create also peace of mind when a SD-card with some wallet backups would get stolen. The thief could not do anything with the backups without the correct password-- the device password cannot be forgotten, or else the wallet cannot be recreated! This feature would make the wallet theft proof.
- The best hardware Bitcoin wallet should not require drivers by using a single-purpose microcontroller that connects to a computer as a plug-and-play USB device.
- The best bitcoin wallet should have a minimalist design that keeps the code as simple as possible, making audits easier and reducing the number of attack vectors.
- The best bitcoin wallet should use AES-256-CBC encrypted communication over USB that is immune to glitching and timing attacks.
- The best bitcoin wallet should have a Two-factor authentication option to prevent man-in-the-middle (MITM) attacks.
- The wallet should erase and reset after 15 failed attempts, eliminating brute force password attacks. If a reset happens by accident, the wallet can be recovered simply by reloading the wallet seed from the micro SD card.
- Capacitive touch button confirmation for transaction. You should physically touch the device briefly to for example 'reject', and touch longer to 'accept' a transaction.
- The best Bitcoin wallet only uses a native software client in order to avoid security risks of browser-based clients.
- The best Bitcoin wallet should enable you to use Plausible deniability with hidden secret wallets and backups. This feature would also be very helpful in case of a violent robbery in which you would be forced to open the wallet. You would be able to keep your secret hidden wallet safe by opening a fake or other wallet you have active on the hardware device.
- The hardware wallet should be Tor and Tails OS compatible to protect your privacy.
- Again, the Private keys should be kept on a high-security chip that prevents physical extraction and should have a very long lifespan.
- The hardware wallet should be portable with an extremely durable case filled with epoxy and packed with security.
- It should have a subtle design to avoid unwanted attention.
- It should support Multisig & FIDO U2F out-of-the-box!
- It should be developped by a team with excellent Bitcoin expertise.
Conclusion based on comparative research:
This is a long list with very strict requirements for building the best bitcoin wallet. As you understand, the best Bitcoin wallet is always a hardware wallet that enables cold storage and the best malware and hacker proof protection. Our research only found 1 hardware bitcoin wallet that meets all of the above requirements and is also relatively cheap. This is the Digital Bitbox. The Digital Bitbox is the best bitcoin wallet available. Jonas Schnelli is the CEO of the company developing the Digital BitBox. He is a lendengary Bitcoin core developper with an incredible expertise in the intrinsic cryptografic complexities and security of the Bitcon netwerk.
These bitcoin hardware wallets will also be discussed and used during our workshops and in our workshop guide.