Author: Jérôme Legoupil 2016-04-24 10:05:52
Published on: 2016-04-24T10:05:52+00:00
A new idea for improving Bitcoin wallet security and deterring thefts has been presented at the 3rd Bitcoin Workshop, which is being held in conjunction with the Financial Cryptography Conference in Barbados. The proposal describes a way to create vaults, which are special accounts whose keys can be neutralized if they fall into the hands of attackers, rendering the attacker's transactions null and void. Vaults are Bitcoin's decentralized version of calling a bank to report a stolen credit card. The operationally simple idea involves sending money to a vault address that anyone can create, which has a vault key and a recovery key. When spending money from the vault address with the corresponding vault key, one must wait for a predefined amount of time (called the unvaulting period) established at the time of creating the vault, say, 24 hours. Vaults demotivate key theft in the first place as an attacker who knows he will not be able to get away with theft is less likely to attack in the first place, compared to current Bitcoin attackers who are guaranteed that their hacking efforts will be handsomely rewarded.Vaults enable important use-cases for Bitcoin as a store of value, particularly the tricky but critical use-case of successions (heritages). A paper describing the details of the proposal is available at the link provided. Another feature in Bitcoin's programming called CheckOutputVerify could also greatly deter Bitcoin thefts. This new feature allows users to recover stolen funds by using a recovery key within 24 hours of a transaction issued by a hacker with the user's vault key. This "undo" facility is similar to what modern banking relies on, but for Bitcoin. The use of this feature does not affect fungibility and restrictions can only be placed by the coin owner ahead of time.The implementation of these new features in Bitcoin's programming highlights the challenges faced by clients and keys when it comes to securing Bitcoin wallets. Comments and suggestions from the community are welcome to further improve Bitcoin security.
Updated on: 2023-06-11T04:46:59.518454+00:00