Topic: How it looks like to use a passphrase? (Read 137 times)

We can always go in circles and create more doubt. People buy and sell things. The same goes for bitcoin. It's perfectly reasonable to assume you owned some coins for months and then you decided to sell them for whatever reason. Many people do that. Of course, if you bragged about your stash on Instagram just 3 days before the robbery, you are in for a world of pain. I think that still beats the I only have $10 in this €130 HW. The way you did it is obviously better than either of the two suggestions. 

Which poses the next question: "How to get the attacker to believe you didn't just send those coins to a different wallet you also control?"

I prefer the approach of using multiple passphrases. Base wallet, small amount of coins I can hand over to an attacker. Passphrase 1, larger amount of coins which could reasonably be my entire stash, which I could hand over if very much coerced to do so. Passphrase 2, my actual stash, with no evidence of its existence and no blockchain links to any of my other wallets.

And even in this scenario, I could hand over Passphrase 2 if absolutely necessary, since I don't keep all my funds on one hardware wallet anyway, and my various other cold storage and paper wallets would still be safe.

I guess it depends on the thief and how smart and patient they are. Someone who thinks, might say why would this person own a €130 hardware wallet and store only $10 in it? What is he not telling me? Let me break his index finger real quick and see if he thinks of something else.

It might be better if that hidden wallet had some transaction history. Perhaps at one time in the future, it used to hold $1000 worth of BTC, but you sold it all and all you have left now are those sats worth $10. A transaction coming it and going out to prove that will be visible. So just before you get that punch to the guts for trying to give the thief only $10, you can show him that history and explain you no longer hold those coins.     

Thank you so much guys!
Your replies explain everything about using a passphrase!

In my opinion, that wallets call this feature a "hidden wallet" is both misleading and incorrect because, in essence, every wallet out there needs to be hidden from the prying eyes of others, not just one with an added passphrase. This may confuse inexperienced users since that gives them a false impression that their wallet is somehow encrypted with an additional layer of protection. No, the keys generated from seed words are no different in terms of security from those generated from seed words combined with a passphrase. The only difference is that your hardware wallet doesn't keep your passphrase in its memory, which means you have to insert it manually every time you're trying to regain access to your funds. In terms of user experience, passphrases are terrible because this system assumes you know what you are doing when inserting certain symbols; it's like CLI which will allow you to destroy your operating system without any warning. When you feed your wallet with a "wrong" passphrase, it will show you a "wrong"  empty wallet because your hardware wallet doesn't care much about what to display. That's how it works.

You might find this page helpful regarding how to use as passphrase on the BitBox: https://shiftcrypto.support/help/en-us/21-optional-passphrase

If you enable the optional passphrase option, then every time you unlock your device you will be asked to enter a passphrase. If you want to access the base wallet with no passphrase, you can just leave this prompt empty. If you want to access a passphrased wallet, then enter the passphrase.

There is no such thing as an "incorrect" passphrase. Every single passphrase you enter will lead to a different (but reproducible) wallet. You will never get a warning about an "incorrect passphrase" for this reason, as the BitBox does not know what passphrase you meant to enter and stores no data about the passphrases you do enter. You can create as many different passphrased wallets using as many different passphrases as you like.

Everything hosseinimr93 said is correct.

Regarding this question:
The device always asks you for a password which you enter on the device itself, as normal.
In the software, you will be prompted to enter the passphrase after you set it up. However, you can 'disable' the passphrase feature again, effectively making that wallet hidden in the sense that there is no prompt unless you activate this option again.

Basically, every passphrase is valid and opens a different wallet. That's what some companies call a 'hidden wallet' or maybe also 'plausible deniability' feature.
Someone can pressure you into giving them your passphrase, if they notice that the main wallet (without passphrase) is empty. You could give them any random word, which just unlocks an empty, unused wallet, but to make it more plausible you could deposit some funds in there.

For instance, unlock your BitBox02 with the passphrase 'gorilla', deposit $10 of BTC and use that passphrase if you're in such a situation. They can see 'ok, that's all he got', take the money and leave you alone.

Exactly; because there is no 'right or wrong passphrase'; all of them are 'correct', just that almost all wallets that are 'behind' those passphrases, are empty. But they're all valid! Hope it makes sense.

One more thing: do remember to backup your passphrase! As soon as you start using passphrases, your seed isn't a sufficient backup anymore.

I don't have any information about the hardware wallet you are talking about and I don't know how it works. But generally speaking, if you add a passphrase to your seed phrase, you will have completely different addresses.


Yes, you can have two different wallets. One with passphrase and one without passphrase. The wallets will have completely different addresses.


As I already said, I don't have any information about the hardware wallet in question, but it shouldn't be like that.
It should ask you the password and not the passphrase.
Passphrase acts like the 13th word of your seed phrase. (I am assuming you have a seed phrase including 12 words).
Take note that you will need the passphrase whenever you want to recover your wallet using your seed phrase.


With a wrong passphrase, you will have a different wallet and completely different addresses.
 

With 100 different passphrases, you will have 100 different wallets.

Hi,

I purchased my first hardware wallet.
It is BitBox02, and in order to use passphrase one needs first to activate this option.
I have got some questions about using passphrase. I avoid activating option "passphrase" and using passphrase until I understand how it looks like using it.

Can you please explain me some things that I don't understand properly.
My questions relate to using passphrase with any hardware wallet in general, not just mine.


1. If you initially set up and start using a hardware wallet without passphrase, can you add a passphrade later and get thus 2 wallets, one without passphrase and another one with passphrase? And funds can be transferred from the initial wallet (without passphrase) to the second wallet (which has passphrase)?

2.
Will device ask for passphrase every time immediately after you have entered pin/password (to unlock device)?
Or does it work that way that device is not asking for passphrase, it just open wallet without passphrase, and then you click somewhere and enter the passphrase?

I am askimg this because I don't understand how it works with "hidden wallet".
If device is asking for passphrase then no "hidden wallet" is possible because the fact of asking passphrase itself reveals that "hidden wallet" exists, and thus the wallet is not "hidden".

3. If a typo in passphrase is opening a different wallet, does it mean that hardware wallet doesn't say "wrong passphrase", but is just opening a different wallet?
Does it mean that if you enter  1000 wrong passphrases, then the wallet will not be reset or wiped, it will just open 1000 different wallets?
So making a typo (I don't mean forgetting or loosing passphrase) is not dangerous itself no matter how many times you made a typo?

Thank you!