Inside Bitcoins Conference, Dec 10-11, 2013

Best Practices for Using and Securing Bitcoins
"# $ecem%er, &#"'

Alan Reiner Founder & CEO Armory Technologies, nc!
© Armory Technologies, Inc. 2013

(ist of To)ics
• • • • • • Introduction Bitcoin storage methods Bitcoin Basics The wedding of cryptography and money Security Practices The future of Bitcoin best practices

Learn to hold your own Bitcoins and let the power of decentralized money shine!
© Armory Technologies, Inc. 2013

*ho Am +
• Alan Reiner , “etotheipi” on the bitcointalk.org • Mathematician, Statistician, SW Developer, Perfectionist , ith a sprinkling of cryptography and data mining

• Have been part of the Bitcoin community since 20 , !ontribute to documentation" standards" security discussions" etc" on the “Development & Technical Discussion” forum

• A hu!e ner"# #you ha$e to be to do what I do% , Sub&category' “ultra&paranoid crypto&nerd”

© Armory Technologies, Inc. 2013

. *ecently funded" will de$elop beginner+s interface .*hat is Armory+ • Armory Bitcoin Wallet is a free. Sometimes “con$enience” is one of those costs.org • &no'n for (security at all costs) .. open$source "es%top application for securin! Bitcoins yourself . !urrently a tool tailored to ad$anced)power users . . (ne of four such applications featured on bitcoin.

eed Bitcoin&/t running in background #for security-% .ultiple&wallet interface . . Armory is still one of the only 'ays for non$e+perts to use (col" stora!e) . Inc.ot for Be!inners# .eed to download blockchain . 0ots of ad$anced features . Sign transactions from an air&gapped computer • Also innovate" many other features . Printable paper backups #with fragmenting-% • . . allets that only ha$e to be backed up one time .*hat is Armory+ • *ven after t'o years. 2013 . .create" Armory because the best practices 'ante" 'ere not available else'here © Armory Technologies.

Bitcoin Basics • Bitcoin has the potential to revolutioni. yo h!"e to t!%e o"er the res#onsi&ilities of those third-#!rties'( © Armory Technologies.. But it will get easier.e!ative/ Take control of your own money #and lose it%(If yo !re sing Bitcoin to remo"e third-#!rties from the e$ !tion. The same way email changed written communications • Bitcoin is complicate" .e payments . 2013 .. Inc. hopefully • Bitcoin creates both tremen"ous opportunities an" tremen"ous ris%s . 1arness the opportunities" mitigate the risks' win&win • Positive/ Take control of your own money #and sa$e%• .

Inc.t-s .ust a Ba%y • 0he infrastructure aroun" Bitcoin is still bein! built • Relatively spea%in!. 2013 . *elati$ely unknown for years • 1ots of venture capital flo'in! in to turn it into somethin! much bi!!er • Still a lot of soul$searchin! to "o by the community Bitcoin may end up being the TCP/IP of money – ad anced payment systems will be built off of it! but only de elopers ha e to interact with it directly © Armory Technologies. Bitcoin is still in its infancy . Started only fi$e years ago #2334% .

& t it r!rely e*ceeds +0.-D. © Armory Technologies.*hy Bitcoin+ • Sho' me another payment system that you can pay someone 2 0.01 .000 3SD/ . !an+t be fro9en or sei9ed #without direct access to your wallet% • Bitcoin is not perfect. ith 73. 2013 . but it certainly is po'erful# • 0here is no other payment system li%e this# • -f only 'e coul" ma%e it safe an" usable444 )Cert!in ty#es of tr!ns!ctions m!y re$ ire fees. Irre$ersible . To and from anywhere in the world . 25)6 without restrictions .000.33 in fees8 . Inc. .early instantaneously .

e!sy to identify. The entire schedule of Bitcoin generation was announced in 2334 and cannot be changed . f ngi&le. There will only e$er be 2:"333"333.ot controlled by any one entity' run by all users of the system simultaneously• 1imite" Supply .33333333 Bitcoins . Predetermined inflation" no printing)debasing • Secure# 5theoretically6 . Inc. . d r!&le( © Armory Technologies.e" . 2013 .*hy Bitcoin+ • Decentrali. the s ##ly is limited. Built from standard" trusted crypto algorithms Bitcoin shares many of the same properties as gold (no one iss es gold.

<2&byte secret #pri$ate key% can control 7millions .o Bitcoin insurance © Armory Technologies. *aises the stakes of computer and network security . . Inc. 2013 .ay hold BT! properly but use poor user auth !ounterparty risk . .ay be more diligent about security than you .oney now stored directly on phone" computer" paper" etc • Store Bitcoin yourself 7 =ull control o$er your money 7 !annot be sei9ed or stolen if secured properly $ It+s easy to lose <2 bytes if you+re careless- • 1et someone else hol" your Bitcoin 7 $ $ $ . no' ("ata) is (money) .Bitcoin Storage O)tions • With Bitcoin.

000 22.000 37. (Chin!( 1*ch!nge 4!llet 1*ch!nge -ometimes sers get some of their o<n money &!c%.000 +1.100.000 +51.000 Bitcoinic! (61( 1*ch!nge Bitcoinic! (62( 1*ch!nge Bitfloor In# ts.000 2.000 20.100 +23.200. Inc.000 +1. ne 2011 /yBitcoin /!y 2012 . 2013 .io 0B.100 2.100.000 35.000 +308. 0o* .000 +2. ne 2011 /t. -ometimes. ly 2012 -e# 2012 9ct 2013 :o" 2013 1*ch!nge 4!llet 2.Third/Party Ris0 • 0he history of Bitcoin is fille" 'ith users trustin! thir"$parties to hol" their money & !urrently" there is no e>ui$alent of =?I! for Bitcoin "ate #er ice #er ice Type BTC Lost / #tolen $#" %alue &at time of loss' . © Armory Technologies.000 +280.

. and dangerous. @eep your fires small until you are eAperienced • Sometimes the bi!!est threat to users is themselves . Inc. learn the ris%s. Bsers are not used to truly irreco$erable data. an" e+periment 5'ith small amounts6 © Armory Technologies.. Can be extremely useful.ot e$eryone makes backups . 2013 .o one eApects their hardware to fail *"ucate yourself. . learn the tools..1olding 2our O3n Bitcoin • Hol"in! your o'n is li%e harnessin! fire .

But we+re not done yet © Armory Technologies. 'hat are users suppose" to "o 9#9 Ans'er/ Most users shoul" not be puttin! life$ chan!in! amounts of money into Bitcoin yet# • Bitcoin is still the Wil" West of money • People li%e me are buil"in! safer tools : infrastructure . 2013 .1olding 2our O3n 4cont5 • Most users shoul" not be hol"in! life$chan!in! amounts of Bitcoin themselves • Most users shoul" not be trustin! thir"$parties to protect life$chan!in! amounts of B08 for them • Wait444 so. Inc.

Inc.Cryptography ( Bitcoin ) #hort! *on+Technical Introduction © Armory Technologies. 2013 .

Authenticity of communications #sign C $erify% • Bitcoin protocol "oes not use encryption .Pu%lic/Pri6ate 7ey Cry)to • . Inc.n the internet. 2013 . there are t'o main concerns/ . Privacy of communications #encrypt C decrypt% . “Are you authorized to move this money?” • All users create a private %ey 5secret6 an" a public %ey 5"istribute"6 © Armory Technologies. The Bitcoin protocol only uses “authentication” .

PTfT0DS0m$6?i$f.:9P:ePD/Eefi2?.%ee# it secret so only you c!n ! thori?e #!yments A Bitcoin a""ress is <ust a representation of a public %ey/ Such as' “:. Inc.a” © Armory Technologies. account number .Pu%lic and Pri6ate 7eys • 0hin% of Bitcoin as a "ecentrali.is the signing authority on th!t &!n% !cco nt • All users ma%e %eypairs for (account) mana!ement .e".is li%e ! ban.gi"e to #!yers to de#osit money in yo r =!cco nt> . public ban% . 2013 .

2013 . Inc.E8am)le 9et3or0 • All Bitcoins have a public (unloc%) con"ition • Most coins have a simple unloc% con"ition/ provi"e a si!nature that verifies a!ainst a specifie" public %ey • -f you have the private %ey. you can create those si!natures# #so your wallet includes them in your balance% © Armory Technologies.

2013 .e a lot more sense after this demo--- © Armory Technologies. Inc.) Bitcoin Transaction Bitcoin might ma.

© Armory Technologies.lice and Bob ha$e all the pri$ate keys associated with those coins #and a couple eAtra unused keys% .ssume the Bitcoin network has 2: coins • . Inc.ll coins are locked using public keys A" B and 8 #so far% • . 2013 nitial Conditions • .

2013 Bitcoin Transactions .© Armory Technologies. Inc.

© Armory Technologies. Inc. 2013 Bitcoin Transactions .

© Armory Technologies. 2013 *ho o3ns 3hat+ . Inc.

lice • Bob+s wallet will select unused pri$ate key *" and then create a payment address #based on the public key *% • Bob sends the address to .lice re>uesting payment . Inc.© Armory Technologies. 2013 Payment Re:uest • Bob will re>uest = B08 from .

Inc. She also selects an unused key #D% to send the 2 BT! back to herself #change% . 2013 Create Transaction • Alice+s wallet selects some coins that she knows she can sign for #at least 5 BT!% • She will use the F BT! associated with A #think of it like a 7F bill% • Alice creates a transaction spending the F BT! .© Armory Technologies.

Inc.© Armory Technologies. If the transaction changes at all" the signature will break #the math stops working% . 2013 Bitcoin Transactions • Alice uses pri$ate key A to sign the transaction • The signature is mathematically linked to e$ery detail of the transaction .

. . 2013 Bitcoin Transactions • Alice “broadcasts” the transaction to the Bitcoin network • Bsers of the network $erify' . The F BT! is unspent The sig corresponds to public key A The sig is $alid for this particular transaction .© Armory Technologies. Inc.

Inc. 2013 Final Condition • The original F&BT! bill is destroyed and 2 new bills totaling F BT! created • .© Armory Technologies.ll users update their databases .

send to others% • Public %eys let you/ .*hat 1a6e *e (earned+ • Private %eys let you (unloc%) an" (re$loc%) coins un"er other public %eys #i. 1andwritten sigs can be #maliciously% transplanted between documents" Bitcoin signatures can+t be • Wallets contain a lot of private %eys .e. . Inc. *ecei$e money See a$ailable coins)balance • 0ransactions usually have 2 parts #payment C change% • Si!natures are mathematically lin%e" to the si!ne" "ata . Bses a new key for e$ery recei$ing operations © Armory Technologies. 2013 .

Inc.Cold Storage • . Private keys are only re>uired to mo$e the coins -t is possible to %eep the private %eys on an offline computer an" receive money to it usin! the public %eys )rmory <!s designed to do e*!ctly this' It is the gold st!nd!rd of <!llet sec rity &est #r!ctices © Armory Technologies. (nly public keys are re>uired to recei$e payments and $erify transactions . 2013 .ow we can appreciate “col" stora!e” #aka “offline wallets”% .

#ecurity Best+Practices (for "!rying le"els of #!r!noi!( © Armory Technologies. 2013 . Inc.

Security 6s! Con6enience • .early all system become more inconvenient as you increase security# . 1onestly" this is why Bitcoin may not be ready for primetime-f you>re !oin! to hol" a lot of Bitcoin it>s 'orth sacrificin! some convenience to protect yourself © Armory Technologies. 2013 . The easiest systems are usually the least secure. !ommit to doing security right • A lot of users "on>t have the patience for this . Inc.

ll wallet de$s sign their installers using known EPE keys = . Gou download installers from a malicious website ./<erify 2our nstallers • Ris%s/ .n attacker tampered with the installers on the real website ..ac" but a lot of work in indows- © Armory Technologies. 2013 .ost de$s keep a special offline EPE private key Hust for this. Inc. Eet the de$eloper+s EPE public key and $erify- -f the installer has a vali" si!nature from the correct ?P? %ey. .P. . The installers are replaced during or after download • Miti!ation/ . it "oes not matter 'here you !ot it from# There are slides at the end that eAplain in detail This is $ery easy in 0inuA C .

R*/ Ma%e an unencrypte" bac%up offline an" secure it# #paper" ?I? or BSB key% .n encrypted backup is useless if you forget the password = . -t is critical your bac%up be unencrypte"# = . "i!ital security is the most important @or most users.Bac0u) 2our *allets • Ris%s/ .n encrypted backup is useless if you get hit by a bus and your family would like to inherit your fortune @or most users. physical security is not a concern 0H*R*@. 0he most common reason users lose coins is "ue to not havin! an unencrypte" bac%up# = Gou lose all your Bitcoins if your hard dri$e fails = Gou lose all your Bitcoins if you forget your password = Gour family cannot inherit your Bitcoins if you get hit by a bus .

but the "ata 'ill be recoverable in A07 years Armory 0echnolo!ies recommen"s that you use paper bac%ups 'henever possible 8opy the "ata by han" if necessary Most thin!s that "estroy paper also "estroy "i!ital Armory @!#er B!c% # . Store together" at least one will work • Paper fades over time. If it+s more than your wallet $alue" don+t use it • -f you use "i!ital bac%ups.Bac0u)s> $igital 6s! Pa)er • Ho' much are you 'illin! to bet that your 8D or 3SB %ey 'ill still 'or% in A$ 0 years from no'9 . ma%e multiple copies .

!ll <!llet de"elo#ers <ill &e im#lementing the one-time-only &!c% # fe!t res . ma%e a paper bac%up. Multibit and Bitcoin Wallet for Android re>uire regular backups unless you always reuse addresses #not good practice-% = . Bitcoin-Qt wallets must be backed up e$ery :33 transactions .R0A. Armory and Electrum wallets only re>uire one backup" e$er = Infinite pri$ate keys generated from a single seed = Print your seed on a piece of paper for reliable storage -f you use Armory or *lectrum. one time. then never 'orry a!ain# In the ne*t fe< months.0/ At the time of this 'ritin! 5Dec 20 B6/ .Bac0u) Fre:uency • -MP.ddress reuse is bad" but probably better than losing money .

If you are concerned about physical security" a single&sheet unencrypted backup is a single&point of failure • Miti!ation' . Bse M&of&. =or instance" <&of&D' print A “fragments”" need any B . Store each fragment in a different location = SecurityJ. “Shamir+s Secret Sharing” . Armory is the only 'allet offerin! this# -t is calle" (@ra!mente" Bac%ups) 0r!#hic for 3-of-8 B!c% # .ttacker needs to steal multiple fragments = *edundancyJyou can lose pieces and it still works8urrently.Fragmented Bac0u)s • Ris%s/ .

Fragmented Bac0u)s ArmoryAs Br!gmented B!c% # Interf!ce .

your 'allet 'ill be permanently encrypte" an" your coins 'ill be lost# . . ma%e an unencrypte" bac%up# ..ake an unencrypted backup- -f you>ve ever for!otten a pass'or".*allet Pass3ords • -MP.R0A.o really/ ->m serious your coins 'ill be lost forever ..0/ Cour 'allet pass'or" is your encryption %ey for your 'allet# • -f you for!et your pass'or". Bsers are not used to the idea of truly" irreco$erable data .unless you ha$e an unencrypted backup • .

Armory+s key&stretching is resistant to EPB&acceleration • -f someone !ets your encrypte" 'allet. . they can !uess/ . !on$erting your password into the encryption key is a computationally&intense process . *ecommended :3&:2 characters with key&stretching 3se a stron! pass'or".Pass3ord (ength • Armory an" Bitcoin$Dt both use (%ey$stretchin!) . ithout stretching' :"333"333 & D"333"333 passwords)sec ith stretching' D & D3 passwords)sec • -f %ey$stretchin! is not use". must lon!er pass'or"s . *ecommended :2&:F characters for no key&stretching . ma%e unencrypte" bac%ups# .

2 ch!rs (no stretching( 0 ch!rs (<ith stretching( 1 ch!rs (<ith stretching( .000. Computer 10 min 7 d!ys 1C.Pass3ord (ength Time to brute&force your wallet password8 Password Length 0 ch!rs (no stretching( 1 ch!rs (no stretching( . .700 ye!rs 130 d!ys 21C ye!rs 333.2 ch!rs (<ith stretching( . your wallet encryption 8!a$eats' used <3&character alphabet to simulate poor entropy of human&generated passwords.!///!/// Computers Instant Instant C d!ys Instant 2 ho rs 333 ye!rs If your wallet is aluable enough! a bot+net of .!///!/// computers could be used to brea.000 ye!rs . Truly random passwords of these lengths will be much more secure.

Some users force reuse due to lack of understanding or simplicity of backups This is doing more harm than good in Armory C *lectrum . hen you reuse addresses you make it far worse . Bsually ha$e an option to eAplicitly create -f you are usin! Bitcoin$Dt. Multibit C An"roi" Bitcoin Wallet reuse addresses by default . Multibit or An"roi" Bitcoin Wallet. Bitcoin$Dt. *eusing addresses can hurt other users+ pri$acy as well • Miti!ation/ . Bitcoin is actually not $ery good at anonymity . you may 'ant to reuse a""resses any'ay if you "o not create bac%ups re!ularly4 (l!c% of #ri"!cy is s !lly #referred to losing coins( © Armory Technologies. Armory and *lectrum do not reuse addresses by default . .$o 9ot Reuse Addresses • Ris%s/ . Inc. 2013 .

But it is egregiously bad for pri$acy in Bitcoin • 0here are conte+ts in 'hich it is o%ay. 2013 . ?onation addresses' all users donating know it is hea$ily reused" and accept being linked to it 3sers "o not reali.ddress reuse is mostly a pri$acy issue" not a security issue . *eusing the same public&pri$ate keypair is eApected C safe throughout the rest of internet security . . but not stan"ar" . Inc.e <ust ho' much privacy information is lea%e" by interactin! 'ith heavily$reuse" a""resses# © Armory Technologies.Address Reuse & Pri6acy • Discussion/ .

Address Reuse & Pri6acy • -f you are usin! Armory or *lectrum. 2013 . you have no e+cuse for reusin! a""resses# .o matter how many new addresses you use" a backup made when the wallet was created will always work- © Armory Technologies. Both produce backups that work fore$er = . Both automatically generate new addresses for all operations K you ha$e to go out of your way to reuse . Inc.

ore confirmations means more confidence .ctually eAponential random' usually B0 sec to =A min © Armory Technologies. The first confirmation is the most important . . SiA confirmations is generally considered irre$ersible • 8onfirmations come on avera!e every 0 minutes . Inc.*hat are Confirmations+ • Bitcoin transactions are not instantaneous • *ach confirmation is increase" consensus that the transaction actually happene" . 2013 . .

(r" you+re willing to eat the loss when re$ersed • Attac%s on .ero$confirmation transactions unless there is pre$e+istin! trust# .Confirmation Ris0s • Do not trust . Inc.ero$confirmation t+ are easy an" cheap . 2013 . Lust not that many people doing it right now • Attac%s on one$ confirmation t+ reEuire a bit more resources = But they are possible- © Armory Technologies.

Gou want to make sure you send it to the right place. .Call/to/<erify Addresses • -f you are sen"in! lar!e amounts of Bitcoin/ . This will not work in all en$ironments #not e$eryone has an SS0 certificate% • Pic% up the phone an" call the other parties . The “payment protocol” hopes to sol$e this by using SS0 concepts to pre$ent address tampering . This is much more reliable with an offline computer .anually $erify the address before eAecution .ake sure they are who you think they are.n attacker could replace the correct address with his own on its way to your wallet software • 0his is a serious security issue# . . .

Cold #torage and the 3oly 4rail © Armory Technologies. 2013 . Inc.

1ot 6s! Cold (Hot) Wallet . Pri$ate keys created and ne$er lea$e the offline computer .ll wallets are “hot” by default (8ol") 'allet 5(offline 'allet)6 . Eold standard of security . Transactions are signed offline . The pri$ate keys are on an internet&attached system . .

1ot 6s! Cold Security
• All %no'n, ma<or Bitcoin breaches to "ate/ , !oins stored on a hot wallet , (r unencrypted backups stored on an “hot” computer

• 8ompromisin! a col" 'allet reEuires one of the follo'in!/ , Physical access , MAtremely ad$anced BSB $iruses , Bser accidentally installing malicious software

Setting u) the Offline Com)uter
5nline computer 5ffline computer

• 5 6 -nstall Armory

• 5 6 -nstall Armory • 526 8reate ne' 'allet • 5B6 8reate paper bac%up
, !opy by hand" if necessary

• 5=6 8reate ('atchin!$ only) copy of 'allet • 5A6 8opy to 3SB "rive • 5F6 -mport ('atchin!$ only) 'allet

Cour ('atchin!$only) 'allet has only public %eys, no private %eys#

$oing an Offline Transaction
5nline computer 5ffline computer

• 5 6 8reate transaction
, Same as you would with a hot wallet

• 526 Save unsi!ne" transaction to 3SB • 5B6 1oa" t+ from 3SB • 5=6 Revie' for accuracy#
, ;ll benefit is lost if you don+t re$iew on the clean" offline computer

• 5F6 1oa" si!ne" transaction, broa"cast to net'or%

• 5A6 Si!n the transaction, save to 3SB

the offline 'allet is the si!nin! authority4 .S)litting roles 5nline computer 5ffline computer • 0he 'atchin!$only 'allet behaves i"entically to a re!ular 'allet. It does nothing else but read and sign transactions- • An attac%er !ettin! the online 'allet is a breach of privacy. See balances • 0his computer cannot "isplay balances . It can re$iew transactions and re>uest confirmation • Remember. not security . !onfirm incoming transactions . It has no access to the network to know where your money is. Eenerate addresses . but cannot si!nGspen" .

$oing it Right • -f you are runnin! any %in" of online Bitcoin business. 2013 . offline$'allets are an invaluable tool . perio"ically refill from the col" 'allet © Armory Technologies.o one 'ho !ains access to the server can steal it# . Inc. Includes employees -f you nee" a hot 'allet. %eep it small. All 'ebservers an" on$site computers should only use watching-only wallets! = Securely collect payments to the offline wallet = Track your wallet balance = Track and $erify all payments)transactions = . &eep bul% of your fun"s in an offline computer = Gou can e$en keep it in a safe&deposit boA.

43 © Armory Technologies.ffline' Bbuntu :3. Inc.rmory 3. It+s an offline computer because the computer is offline • Mi+ an" match versions to your heart>s content . The following setup works fine' = .35 using .nline' indows OP using .rmory 3. 2013 .FA? • 0here is no special version of Armory for offline .2 = .N6.

2013 . Inc. 0inuA has a much better history of resisting BSB& based attacks . the best 'ay to move "ata bet'een online : offline computer is 3SB "rives .nce you !o "o'n the (col" stora!e) path you are implementin! serious security • As of this 'ritin!.Use (inu8 • . ill install and run on the first boot of a fresh install of Bbuntu :3. e are working on better methods for secure transfer • Armory 'ebsite has 3buntu (.35 or :2. The offline computer needs no other software at all- © Armory Technologies.35 .ffline Bun"les) .

ake it eAclusi$e for Bitcoin processing • 3se full$"is% encryption to protect privacy .e unencrypted bac.ups6 © Armory Technologies. .inimi9e eAposure to potential $iruses . . Inc.E8tra Credit • De"icate a small 3SB %ey for offline transactions . 2013 . ithout it" someone not authori9ed can still see the wallet $alue and transaction history . .inimi9e eAposure to potential $iruses • De"icate a computer for the creatin! transactions . .lso adds an eAtra layer of security "id I mention! ma.

The 7uture Coming #oon! © Armory Technologies. 2013 . Inc.

Inc.1ard3are *allets • . It will only emit the public keys Tre?or D!rd<!re 4!llet • The 0re. 2013 .or is the most anticipated 1 • Should be released in Lanuary" 23:5 wallet © Armory Technologies. great tradeoff for security and con$enience • 1ardware wallets hold the private keys and si!n on the "evice . The private keys cannot be read from it .

2013 .ore difficult to audit .e" . They lack fleAibility . Inc. !onnect directly to online computer $ia BSB • 0he 'allets they use are stan"ar"i.1ard3are *allets • Har"'are 'allets are an H0I solution .nother layer of trust re>uired . . Should be supported by all maHor wallet apps • Will be a hu!e 'in for convenience : security © Armory Technologies. .

Inc. 1ere+s a public key" sign with its private key to mo$e • Much more comple+ con"itions are possible/ . 1ere+s B public keys" sign with any 2 private keys .@ulti/Signature Transactions • Most coins have a simple unloc% con"ition/ . 2013 . This is a 2$of$B multi&signature transaction © Armory Technologies.

from ! single com# ter The fr!gments only need to &e collected if <!llet is lost M$of$. 2013 . 1a$en+t we seen . conditions of the coins :et<or% e*#ects m lti#le sigs for e"ery tr!ns!ction © Armory Technologies.@ulti/Sig 6s! Fragmenting • Wait a sec. this soun"s familiar# . Bac%ups Br!gmented &!c% #s !re for sec ring yo r &!c% # All tr!ns!ctions still re$ ire ! single sign!t re. Multi$Si! / lti-sign!t re tr!ns!ctions !re networ. beforeP • Ces# @ra!mente" bac%ups also use (M$of$.+enforced / lti#le # &lic %eys !re incl ded in the unloc. Inc.) M$of$.&of&.

Multi$Si! © Armory Technologies.@ulti/Sig 6s! Fragmenting M$of$. Inc. 2013 . Bac%ups M$of$.

ll money handled by the company goes into <&of&D .ll money re>uires < signatures to be mo$ed © Armory Technologies. . .ations .ll wallets currently ha$e a single point of failure • Cou can have/ . 2013 . =i$e board members of a company all create wallets . Inc. allets are managed by employees" who may steal . .A Critical PuAAle Piece • Multi$si!nature transactions are critical for lar!e or!ani.

Inc. 2013 .89tras #tuff that I wanted to present but couldn:t fit © Armory Technologies.

org • Mathematician. ith a sprinkling of cryptography and data mining • Have been part of the Bitcoin community since 20 .*ho Am + • Alan Reiner . Soft'are Developer. Sub&category' “ultra&paranoid crypto&nerd” © Armory Technologies. 2013 . Inc. Perfectionist . “etotheipi” on the bitcointalk. !ontribute to documentation" standards" security discussions" etc" on the “Development & Technical Discussion” forum • A hu!e ner"# #you ha$e to be to do what I do% . Roc%et Scientist.

. But I do ha$e some street cred. Geah" whoops. • 8ore Developer of Armory Bitcoin Wallet . Inno$ated cold storage" one&time paper backups • Discovere" the ('hoops$your$'allet$isn>t$actually$ encrypte") bu! in Bitcoin$Dt 04= .. Inc.Accom)lishments • Be careful 'ho you trust# ... inclu"in! the (Security) Panel at San Jose 20 B4 © Armory Technologies. • Spo%e on multiple "iscussion panels at Bitcoin conferences. Secure wallet software' open&source" popular" trusted . 2013 .

Presintalled in 0inuA C . Because it+s hard in indows" I $erify my indows indows installers in 0inuA Steps • 5 6 ?et ?P? an" file$hashin! tool . The result looks something like this' f98c7a798122167c98c0a798122167f9030a7 . ! .in *(.ac' ?o nothing" it+s all pre&installed.deb> . Mach de$eloper+s “keyI?” should be well&known' mine is 4NN<222< • 5B6 Do'nloa" the installers an" si!ne" hash filesK .?*RPR-. indows' ?ownload !p!='in and S1.ac' “gpg --recv-keys <keyID>” .ost tools ha$e search C import function #0inuA C . MA&* S3R* 0H* @-.<erify 2our nstallers • ?P? is a po'erful.ac' “gpg -v sha256hashes. thorou!hly$truste" crypto tool .asc” .acQ takes effort in .0 MA08H*S 0H* *MP*80*D &*C . 1ash the installer file #0inuA C .de& inst!ller (. in' use right&click gpg5win menuQ 0inuA C . .ac' “sha256sum <filename>” % . it m!y &e signed directly. only need = dpkg-sig –verify *. 0inuA C . .nyone can create a “$alid” signature K but not from the de$eloper+s key- )If it is ! .2DF file hash tool #Hash8alc is good% • 526 -mport the ?P? %eys to your %eyrin! 5only "one once6 . !ompare to the hashes in the signed file • 5=6 Lerify the si!nature on the hashes file .

7eys of @aBor *allets • The most sensiti$e part of using EPE keys is the fingerprint distribution • So here they are.#most EPE apps only show last N chars% © Armory Technologies. Inc.P.. 2013 .

Inc. Gou ha$e a brainwallet- © Armory Technologies. 2013 .Brain3allets 4don-t use themC5 • 1umans are really bad at memori9ing things • Gou will lose coins • Gour family will ne$er reco$er your coins if you die .ny system that re>uires your brain to be useful is essentially a brainwallet • This is why . Gou literally take your wealth with you to your gra$e • . If all your wallets are encrypted .nd all your backups are encrypted . .rmory hates encrypted backups' .

rmory C .Segregate Funds %y Security • Ris%s/ . Bse multiple wallets #. MAercise all the best practices on the maHority of your funds . @eeps most of your funds secured" periodically refill low& security wallets . 1a$ing all your funds in a single wallet" means all funds ha$e the same security . Bsually means funds are super&secure&but&incon$enient" or not properly secured • Miti!ation/ .ultibit ha$e nati$e support% .

“S'eepin!” an address)key means sending all the coins owned by that key to a new address #one you control% . “-mportin!” an address means to add the private key to your wallet K usually so it can be reused • When to s'eep vs import .S3ee) 6s! m)ort • Definitions/ . Gou import a key that someone else has . Sweep if anyone else has e$er had access to the private key . SW**P © Armory Technologies. Inc. That person pays you for ser$ices)goods . Importing really only makes sense with address reuse = I already told you not to do that- • Serious Security to consi"er . They sweep the key after you ha$e deli$ered When in "oubt. 2013 .

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