Topic: Do not trust your memory or hardware, get Redundancy ! Funny True story inside (Read 396 times)

I'll leave here my story, but mine fortunately had a positive ending.

Back in the last few days of 2015 or 2016 (can't remember) I wanted to change every password to an unique one, for my security. They were ~15-char-long completely random strings of characters.

I did this to all my passwords during the night of the New Year. Wrote every pass on pieces of paper, but I was pretty tired at the time. When it came about my Blockchain wallet, I didn't want to change my main password. Instead, I added a secondary one. It did not request me to login once again afterwards.

One week later, first of the next year: Had to go on a trip to another country. I rarely logged on Blockchain from my PC, so access was available from my phone. After adding the password, my phone did not require me to log in again. Anyways, I went on the trip I mentioned earlier and... my phone went straight into bootloop after the second day of the trip.

I lost everything, including +2k photos and videos of very important moments of my life. Tried everything possible to recover my data but nothing helped at all.

Fast forward to the summer of the same year. I never opened my wallet until then because I didn't need to move any funds anywhere. I did not even have my blockchain app installed on my new phone. Checked the price of Bitcoin.. it had doubled since I last checked it. I was so excited - I had about half a BTC in my account. Ran towards my computer, booted it up and went straight to Blockchain. Took my piece of paper with passwords written on it, and my Blockchain password was missing. I thought I might've forgotten to change it, so I entered one of my usual passwords and logged into my account successfully.

Months later, I wanted to finally move my funds. Price was even higher. I logged into my Blockchain account and... When I wanted to move my funds, the big issue was encountered: "Please enter your secondary password:". Took all my papers with passwords written on them but there was no password for my Blockchain account. Panic started!

I tried guessing every single day for more than half an year the password to my account with no help. I tried working with hackers who couldn't bruteforce my password after two months of trying. Finally, I thought "okay, let's go through history. Maybe it helps". So I went over to my very old mail account and looked through my Blockchain emails.

After hundreds of emails, I finally reached the oldest Blockchain emails I had ever received: four "Welcome to blockchain!" emails. I saw the attachment icon next to the subject to each of them and I thought "this must be it!". Entered the Blockchain.com recovery page and dropped the first ".json" file on the webpage. 0BTC on the account. Tried the second. 0BTC. Tried the third. 0BTC. Finally, I tried the last one. "This wallet is encrypted. Please enter your password:". Entered the password and after the first try.. DONE! My Bitcoin account was recovered with all my Bitcoins and no secondary password.

Luckily, the Bitcoin price was the highest since the day I decided to change all my passwords. I never had the seed written down anywhere. So although this was a scary and long story, in the end I have recovered all my funds and had a lot of profit.

Ever since then, I swore I'd never forget to write down the seed of my wallet. I'm extra cautious now because I don't want this event to happen again.

Tl;dr: I added a random secondary password to my Blockchain account and forgot to write it down. Lost access to the wallet for about an year, but recovered it through an email backup Blockchain sent me back when I created it.

About the memory, I meant if nothing unfortunate happens, like an accident or something worse.
No, I don't carry my work laptop around, it stays always in office. Is kind a desktop-laptop thing.

Unlikely, maybe, but not impossible. Why take the risk? Even if you think your memory is 100% foolproof (it isn't), there are a hundred and one completely unpredictable and unexpected things that can happen to anybody with zero warning which can leave you with memory problems, from a head injury to a bad infection. There's a reason that all good wallets tell you to write down your seed phrase and not to memorize it.

A multisignature wallet can certainly be a safe fall back mechanism, but you should still have your seed phrase written down somewhere. I assume you carry your phone and work laptop around at the same time frequently, meaning the chances of them both being involved in an accident or being stolen are not insignificant.

If you attach the seed words (12 words in my case) to a story and memorize it, it is unlikely to forget it. Then from time to time, tell the story to yourself, let's say when you go to sleep (instead of sheep counting).
As a backup, I use multisignature backups (2 out of 3) stored on my phone/home pc/work laptop. What would be the chanches to forget my seed and 2 of my backups to get destroyed at the same time.

This is actually an incredibly interesting story.
I can't relate yet as I am childless but I can definitely imagining my wife throwing away stuff (that I have kept religiously) where I have written seeds.
This is partly one of the reasons why I have a small safe at home. Anything in the safe is not to be thrown away.
And for more important stuff, it is inside a vault at the bank.

Thanks for sharing!

You can never cover all eventualities, but you can backup your seed.  

I had something similar happen to me, when I created a new online wallet with a new site that someone recommended to me and while I was doing this, I wrote down the seed in a old diary from 2015, because it was the only thing that was in reach at the time. The idea was to re-write the seed onto another piece of paper and then to laminate it and to store it in two different places.

Well, I got busy with something else and I totally forgot about this. My kids got hold of the old diary and they started scribbling and drawing inside the diary and nearly destroyed the page where the seed was written on.

Luckily one of them came to me and showed me their drawings and I noticed the seed on the opposite side of the paper. I immediately made 2 copies of the seed and then laminated it and stored it in 2 different locations.

The wallet had about $5000 worth of bitcoins on it and I have not used it for some time, so if something happened to it, I would have been f@#$%$^^!!!!

you have to ask him where he got that number from. there are a couple of possibilities. he may have some actual benchmarks that he extrapolated to get that number. or he may be giving a much higher than reality value to cover the possible future improvements or specialized setups that might be doing this kind of brute force like a powerful GPU rig with a huge hashrate. or the number as i previously guessed might be only checking the validity of the seed not deriving the child keys and checking addresses.

it is actually the first 4 bits and only if there were 12 words but you are correct, that is the first step before doing anything else. that is why i said you still have about 6% or 1 trillion seeds to check.

Yes you're right. So I don't understand why he indicates such small metrics on his page...
Are we sure there is no way to use rainbow tables for this process, at least when no passphrase has been used?
For the adresses you can just check the very first ones(m/44'/0'/0'/0/0... m/44'/0'/0'/0/5) and you can parallelize the task while crunching the next seed alongside.
Moreover you can eliminate all the seeds inconsistent with the checksum (if you have the last word) before doing all of that.
It's just a test between the 4 last bits, and the first 4bits of the SHA256 hash, of the seed, it's fast.

It's not entirely clear where Ian Coleman gets his numbers from for that calculation. On his GitHub repository, that time is calculated under the assumption that an attacker can try 10 billion combinations per second (https://github.com/iancoleman/bip39/blob/master/src/js/index.js#L1573). It's possible that an attacker could generate 10 billion different seed phrase combinations per second, but as pooya87 has outlined above, there is a lot more to it than that.

For every possible seed phrase he has to go through 2048 iterations of PBKDF2 using HMAC-SHA512 to get a 512-bit seed number. For each seed number he then has to perform HMAC-SHA512 to create a master private key, again to create a child private key, ECDSA with secp256k1 to create a public key, SHA256 and RIPEMD160 to get an address, and then each address has to be checked for balance on the blockchain. And that's the minimum amount of work assuming you are using m/44'/0'/0'/0/0. Any other address, change address, account, or purpose (address type) requires additional work.

I'm a little bit confused by your statement because on his page Ian Coleman claims that hackers need only 109 seconds to do this exploit. "Time to hack with only one card: 109 seconds" with a 12 words seed generated https://iancoleman.io/bip39/
Moreover dozen of common paths is a little bit excessive IMO.

that's true and i always advise against using this primitive way of splitting the seed but the recovery is not as easy as it sounds like though. with 4 missing words you will end up with about 1 trillion valid seeds (~6% of the total after validating the checksum). then the attacker has to know the derivation path that was used with this seed so he is left with at least a dozen common paths (keep in mind there is 2048 rounds of PBDKF2 to go from mnemonic to seed and multiple HMACSHA512 in each path's index). then he has to know at least 1 key (or address) from that wallet to check against otherwise he is left with database lookups for each try, that is an elliptic curve multiplication and 2 hashes.
the attacker needs a really strong hardware (like a mining rig) and a highly optimized code to be able to do all of this for 1 trillion keys in reasonable time. otherwise it would take years.

You know what they say, great minds think alike 


The TV show: Oak Island, the Money pit is the greatest example. For more than 200 years people have been searching a treasure on a small island. If only the people hiding it had left a cleared message to find it back 



This is True for organs, and also true for money. For example it was estimated that 14 billion of euros (deceased estate)  haven't been claimed by benefactor and are in escheat.
In 2017,  the French banking system transferred 970 million euros of money that no one has claimed and where they couldn't find benefactors. After 30 years in Limbo, the money goes back to the French budget.

Well in this case, maybe do something similar to me. ( I guess it all depends on how much you have, and how much you want to spend to secure your assets.
For example, go to Switzerland or any other neutral country. Open and buy a safe deposit box for 50 years.
In that box, put your seed on a cryptosteel or other type of medium.
Also, write on paper some explanation about being cautious and to never share the seed ....
Maybe write down the password (like 300 bits of entropy) to a "lastpass" or other similar online backup solution.
This will allow you to put data encrypted on the cloud waiting to go to your vault (if the vault isn't in the same country).
Then write a Will and state that your estate can have access to this vault. So if you and wife pass away, the next in line gets the full crypto package.
This is basically what I have done.

It's interesting to think about. Go back to the early years and by far the biggest cause of bitcoin loss was being simply being careless - throwing out computers, reformatting hard drives, having no back-ups to a corrupted wallet, etc. As time goes on this kind of failure becomes rarer, as people are now fully aware of bitcoin's potential for incredible growth and it is easier to back up wallets due to seed phrases. Moving in to the future, the biggest cause of lost bitcoins is going to be people unexpectedly dying or suffering from memory loss, and having left no instructions to their next of kin about how to recover their coins.

We know people don't plan for these kinds of things as it is. Around about half of people in most developed nations don't have a will, testament, or similar document. Thousands of potentially life-saving organs go to waste every year because people haven't talked about their wishes regarding organ donation with their families. Young people in particular have the mindset of "It'll never happen to me". Why, if you haven't bothered to sort out any of that other important stuff, would you talk to your family about bitcoin? It's a flawed mindset, but a very common one.

I'm in the same situation as you. My wife knows how to access our wallets and where our seeds are stored. I have wondered about what should happen if we were both in a car accident together, or something similar. I've been toying with the idea of setting up a (probably 5-of-7) secret share between a couple of family members on each side and a few close friends.

I haven't lost any crypto because I do have contingency plan : a backed up seed out of the house.



Haha yeah, learned my lesson.
But it turns out, I found it last night. And it wasn't in the bedroom.
It was in my office.
I remain adamant that mice moved it out of the bedroom to the office.
Yes, over the years I started to think about back up, worst-case scenario and how to ensure that my coins aren't lost.




As a matter of fact, I do have keepass, and have hidden the key, the data and the password in 3 places. But again, If i don't remeber where they are hidden, I can go the vault and get them. My weak point is to assume that the Vault is safe (has never been breached in 120 years, and the country I am is considered one of the safest).


YEs that is the best way, and my current set up. My Vault has a second ledger and phone


This is also my set up. A vault out of town.



Indeed, this will be one of the major cause of crypto loss in the coming yesrs. 
My wife has access to the vault in the event of life incindent. The Vault has the Seed, and the password for all my devices and accounts.


This on was more to share and discuss. I'm not using this tool as I have the Vault as my ultimate back up point this 3rd party access if needed (wife and / or next of kin).


Special Thanks o_e_l_e_o for your very detailed answer, It has comforted me in my choices and gave me more things to think about.

I hope you learned an important life lesson, which is that you are not a person who can rely on your memory. If you forget where you put one such important thing in two weeks, you have a serious problem. It's lucky you didn't hide the seed the same way, obviously, you have a very large bedroom with plenty of room to hide things.

You may have mice or rats that are technologically aware and have stolen HW and taken it away (joke)

In fact this article falsely explains what Shamir sharing is. The true Shamir sharing algorithm is based on polynomial functions and gives seeds you can't hack easily.







While with this basic way of doing you "only" need 2048⁴ (2048x2048x2048×2048) trials to find the complete seed with whatever part you have. Because each word of the seed is in fact a number encoded on 11bits, belonging to the bip39 dictionary.

Every site you enable 2FA on should give you a code at the same time, which you should write down on paper and store securely, much like you do with your seed phrase. This is your back up in case you lose your 2FA device. In terms of accounts, you should be using an open source password manager such as KeePass or Bitwarden synced across multiple devices, so if one device goes down you still have access to everything (I can't recommend LastPass as they were recently bought over by private equity firms, and history tells us that when this happens, privacy is usually compromised for the sake of profits). Wallets should obviously be password protected (not biometrics - these are easily hacked) and backed up using seed phrases.

I have both a secondary hardware wallet with the same seed on it as back up, as well as obviously my seed phrases stored securely.

Off site back-ups are key. If you don't have anywhere you can trust to store your seed phrase off site, then consider splitting it as discussed below.

I talk about this frequently. Some people have very poor recovery processes in place, and some have very good recovery processes which are known only to them. Both are equally as useless to someone else. Even something as simple as a blow to the head can give you memory problems. Tell someone you trust how your back up works.

Although this site gives a good explanation of the theory behind secret sharing, the example it gives is poor at best. Splitting a 12 word phrase in to a 2-of-3 share simply by writing 8 words on each card means that if an attacker finds a single card, they only have to bruteforce 4 words to have access to your coins, which is doable with today's computers. There are other ways to split a secret where each part on its own reveals nothing, and only once combining the minimum required number of parts is the secret revealed. SLIP39, for example, describes splitting a master secret such as a seed number in to separate phrases. Ian Coleman has a tool for this here: https://iancoleman.io/slip39/. He also has other secret sharing tools, such as this one: https://iancoleman.io/shamir/. Be aware that if you are going to use such a tool, you should know how to recover the secret in such an event that the Ian Coleman site disappears, otherwise you have a single point of failure.

The technology that made you confused is the same one that provided you with solutions that enable you to reduce the risk of losing your coins.
You need to know how to improve the choice of those solutions and combine them to ensure that your currencies are not lost.
By splitting the seed into several parts, using these options will be safe.

You can still return to traditional systems and trust a third party to save your money, but you have only returned to the past.

So yes it is a catchy title 

Let me tell you my feedback on using my memory and using hardware (hardwallet, or mobile phone).

The keyword of my story is to have redundancy, why is that? because like everything in life one must always have a backup plan.

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Story 1 : Brain / memory
So, before xmas my wife and I went on a holiday. Because we have a dog we took the habit to get a house/dog sitter while we are away.
Pro : the dog stays home instead of a kennel, dogs goes to the same park and same walking tracks. House is not empty.
Cons: have to do interview, have to put all jewelry in the safe, have to have a camera in our bedroom to check no intrustion... 

Anyway, we found the perfect dog sitter.
I tuck all the pricey stuff on the safe, install a couple of camera in the room to check if someone opens the door and see what they may do.
I decided not to take my Ledger S with me on that holiday because we decided to go to 2 countries that are not super safe.
Just in case someone was going to break in, I decided to NOT put my ledger in the safe, but to HIDE it in my bedroom.
I hid it so well that 4 weeks later I am still looking for it (MASSIVE FACEPALM !!!!)

My memory failed me !! I Legit have looked everywhere, I can't find it.
No one has entered the room, it has to be in the room, I just don't remember where.

This is where the contingency plan goes into action.
It turns out I have the seed somewhere safe (bank deposit, not in the same city).
I just need to go fetch it and insert my 24 words in a new device.
The reason the seed is not at my house is due to the fear of a fire. Or in the event of a burglary, they might take it.
Conclusion : don't believe you will remeber everything, have a back up plan.

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Story 2 : hardwallet / hardware / mobile phone

This is another story, I'm roughly 33. I've had a mobile phone since I was 14 years old.
In almost 20 years i have NEVER broken or lost a phone!
Back in 2017, there was the GByteball airdrop. And it was very easy to do on a smartphone (easier than computer).
I did it while I was on holiday with my family.
Because it was just for 1 week, I didn't bother saving the seed on paper.
I told myself I would do it once I am back home and that everything will be fine.
Well, it didn't, I decided to take a photo of my family swimming. I had water to my knees and my phone fell in the water.
Instant death, lost 5 GBYTE lesson learned.
Never trust that your mobile phone will last forever.
Fortunately, I had 2 phones, and all my 2FA were on both phones.
Same as my password manager and all my photos and date.
Redundancy!

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So, in my first story, I haven't lost anything, in the second one I've lost free coins.

What I would like to tell to beginners and also to more experienced users is to have backup, contingency and always keep in mind that things can go unexpected.

I'll drop here a few questions to help you think about your own strategy.

1) what happens if you lose your phone? (2FA? emails access? wallets on the phone ?)
2) what happens if your ledger or trezor is broken/stolen / or reset by someone that uses 3 wrong pin
3) what happens if your house catch fire while you are away. Are you losing both your hardware and back up seed?  what about computer and USB back-up?
4) what happens if you have an accident and end up in a coma. Who can access your coins? How would they know where to look? Did you leave enough explanation so your next of kin can enjoy your coins? Life can end abruptly.

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Useful resources (no ref link) :
 Fireproof seed : cryptosteel or crypto key stack
How to share/save a seed 2 ou of 3 between family
Authy allows you to have 2Fa on multiple devices
Lastpass is a good password manager