Cryptocurrency Wallet Security via Segmented Key Storage
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Solution Overview
Problem
Cryptocurrency wallets face challenges in balancing security and accessibility, with Hot Wallets being vulnerable to cyberattacks and Cold Wallets lacking flexibility and being susceptible to physical damage and theft, while the two-layer wallet system has a robustness issue in its security architecture.
Innovation Solution
A cryptocurrency securing device that uses asymmetric keys for encrypting and decrypting personal identification numbers, personal keys, and private keys, with additional measures like one-time keys and cloud server involvement to enhance security and accessibility, employing a processor, storage module, and transceiver for secure operations.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If Hot Wallet is used for real-time trading and Internet connection, then accessibility and convenience are improved, but security against cyberattacks deteriorates
Solution Approach 1:
The system segments the wallet functionality into two distinct components: a Hot Wallet for frequent transactions and a Cold Wallet for secure key storage. The private keys are generated and stored in the Cold Wallet (offline), while the Hot Wallet uses these keys for transactions without storing them locally, thus separating the functions of accessibility and security.
Solution Approach 2:
The patent introduces a secure element or trusted execution environment as an intermediary between the Hot Wallet and the private keys. This intermediary securely stores the private keys and provides cryptographic operations without exposing the keys to the hot environment, acting as a mediator that enables secure access.
2Reliability
If Cold Wallet is used for offline storage, then security against cyberattacks is improved, but accessibility and flexibility deteriorate
Solution Approach 1:
The system segments the wallet functionality into two distinct components: a Hot Wallet for frequent transactions and a Cold Wallet for secure key storage. The private keys are generated and stored in the Cold Wallet (offline), while the Hot Wallet uses these keys for transactions without storing them locally, thus separating the functions of accessibility and security.
Solution Approach 2:
The private keys are generated and stored in the Cold Wallet in advance, before any transactions are needed. This preliminary action of key generation and secure storage enables subsequent fast transactions through the Hot Wallet without requiring the Cold Wallet to be physically accessed each time.
3Ease of operation
If two-layer wallet system is implemented, then balance between security and real-time trading is improved, but security architecture robustness deteriorates
Solution Approach 1:
The patent implements a nested structure where the Cold Wallet is embedded within or integrated with the Hot Wallet system. The Cold Wallet's secure element contains the private keys, which are then used by the Hot Wallet for transactions. This nesting creates a unified security architecture where the weaker link is eliminated.
Solution Approach 2:
The patent merges the Hot Wallet and Cold Wallet into a unified system where the Cold Wallet's security features are integrated into the Hot Wallet's transaction capabilities. This combination creates a single robust security architecture that leverages both offline security and online accessibility without the weaknesses of separate systems.
Data Source
AI summary
The present disclosure provides a cryptocurrency securing method and device thereof. The device receives an encrypted personal identification number from a user device, and decrypts the encrypted personal identification number via a first asymmetric key for deriving a personal identification number. The device decrypts an encrypted personal key via the personal identification number for deriving a personal key, and decrypts an encrypted cryptocurrency private key information via the personal key for deriving a cryptocurrency private key information.