Shared Custody Wallet Key Segmentation for Security
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Solution Overview
Problem
Cryptographic wallets face security flaws, such as loss of access due to forgotten seed phrases and vulnerability to malicious actors when relying on third-party access, and existing 2FA methods are insecure due to SIM card hacking.
Innovation Solution
A shared custody wallet system where cryptographic keys are stored on both the user's device and a secure third-party server, with 2FA authentication and QR codes used for secure key management, ensuring that sensitive data is never sent to another server during wallet generation and requiring both device and server access for unauthorized access.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If cryptographic keys are stored solely on a third-party server, then user convenience is improved, but security is worsened due to vulnerability to server attacks and unauthorized access
Solution Approach 1:
The cryptographic key is segmented into two parts: a first portion stored on the user's device and a second portion stored on the third-party server. This segmentation allows the system to maintain user convenience through automated key management while improving security by requiring compromise of both storage locations to access the complete key.
Solution Approach 2:
The system transitions from a single-dimension key storage model (either user device or server) to a two-dimension model where key portions are distributed across user device and server. This dimensional change enables the system to simultaneously achieve ease of operation through automated recovery and improved security through distributed storage.
2Reliability
If cryptographic keys are stored on user device, then security is improved, but reliability is worsened due to loss of access if device is lost or user forgets seed phrase
Solution Approach 1:
The cryptographic key is divided and stored in two locations: user device and third-party server. This segmentation ensures that if the user device is lost or compromised, the user can still recover access by providing the first key portion to the server, which will combine it with the second portion to restore full access.
Solution Approach 2:
The third-party server acts as an intermediary for key recovery. When a user loses access to their device, the server serves as a mediator that can reconstruct the complete cryptographic key by combining the stored second portion with the first portion provided by the user, thereby restoring access without requiring the user to remember the entire seed phrase.
3Reliability
If 2FA authentication is implemented, then security is improved, but ease of operation is worsened due to additional authentication steps
Solution Approach 1:
The system merges the 2FA authentication mechanism with the key recovery process. Instead of treating them as separate operations, the authentication steps are integrated into the key reconstruction workflow, allowing users to verify their identity and recover keys through a unified process that enhances security while maintaining operational simplicity.
Data Source
AI summary
There is disclosed a novel method and apparatus for securing and accessing an SMS wallet.