A Peek Under Bitcoin's Hood
Bitcoin is really cool. Sure, there's arguments to be made about whether it's a useful technology, whether we're currently in a cryptocurrency bubble or if the governance problems that it's currently facing will ever be resolved.. But on a purely technical level, the mystical Satoshi Nakamoto created an impressive technology. Unfortunately, while there's a lot of resources out there that give high level explanations of how Bitcoin works (one such resource I'd highly recommend is Anders Brownworth's fantastic blockchain visual 101 video), there isn't a whole heap of information at a lower level and, in my opinion, there's only so much you can properly grok if you're looking at the 10000 ft view. As someone relatively new to the space, I found myself hungry to understand the mechanics of how Bitcoin works. Luckily, because Bitcoin is decentralised and peer to peer by its nature, anyone is able to develop a client that conforms to the protocol. In order to get a greater appreciation of how Bitcoin works, I decided to write my own small toy Bitcoin client that was able to publish a transaction to the Bitcoin blockchain. This post walks through the process of creating a minimally viable Bitcoin client that can create a transaction and submit it to the Bitcoin peer to peer network so that it is included in the Blockchain. If you'd rather just read the raw code, feel free to check out my Github repo . In order to be part of the Bitcoin network, it's necessary to have an address from which you can send and receive funds. Bitcoin uses public key cryptography and an address is basically a hashed version of a public key that has been derived from a secret private key. Surprisingly, and unlike most public key cryptography, the public key is also kept secret until funds are sent frContinue reading >>
Github - Blockstack/pybitcoin: A Bitcoin Python Library For Private + Public Keys, Addresses, Transactions, & Rpc
In this section, we will start with generating the private key, look at the elliptic curve math that is used to turn that into a public key, and finally, generate a bitcoin address from the public key. The relationship between private key, public key, and bitcoin address is shown in Figure 4-1. How to Generate Private Key from a Bitcoin watch only address 2020We help you generate bitcoin private key for non spendable funds. Online bitcoin private ke.
A Bitcoin python library for private + public keys, addresses, transactions, & RPC Python library with tools for Bitcoin and other cryptocurrencies. >>> from pybitcoin import BitcoinPrivateKey>>> private_key = BitcoinPrivateKey()>>> private_key.to_hex()'91149ee24f1ee9a6f42c3dd64c2287781c8c57a6e8e929c80976e586d5322a3d'>>> private_key.to_wif()'5JvBUBPzU42Y7BHD7thTnySXQXMk8XEJGGQGcyBw7CCkw8RAH7m'>>> private_key_2 = BitcoinPrivateKey('91149ee24f1ee9a6f42c3dd64c2287781c8c57a6e8e929c80976e586d5322a3d')>>> print private_key.to_wif() private_key_2.to_wif()True >>> public_key = private_key.public_key()>>> public_key.to_hex()'042c6b7e6da7633c8f226891cc7fa8e5ec84f8eacc792a46786efc869a408d29539a5e6f8de3f71c0014e8ea71691c7b41f45c083a074fef7ab5c321753ba2b3fe'>>> public_key_2 = BitcoinPublicKey(public_key.to_hex())>>> print public_key.to_hex() public_key_2.to_hex()True >>> public_key.address()'13mtgVARiB1HiRyCHnKTi6rEwyje5TYKBW'>>> public_key.hash160()'1e6db1e09b5e307847e5734864a79ea0113d0083' >>> private_key = BitcoinPrivateKey.from_passphrase()>>> private_key.passphrase()'shepherd mais pack rate enamel horace diva filesize maximum really roar mall'>>> private_key.to_hex()'91149ee24f1ee9a6f42c3dd64c2287781c8c57a6e8e929c80976e586d5322a3d'>>> priv2 = BitcoinPrivateKey.from_passphrase(priv2.passphrase())>>> print private_key.to_hex() priv2.to_hex()True >>> from pybitcoin import BlockcypherClient>>> recipient_address = '1EEwLZVZMc2EhMf3LXDARbp4mA3qAwhBxu'>>> blockchain_client = BlockcypherClient(BLOCKCYPHER_API_KEY)>>> send_to_address(recipient_address, 10000, private_key.to_hex(), blockchain_client) >>> from pybitcoin import make_op_return_tx>>> data = '00' * 80>>> tx = make_op_return_tx(data, private_key.to_hex(), blockchain_client, fee=10000, format='bin')>>> broadcast_transContinue reading >>
Coineva - Cryptocurrency Code Factory - Bitcoinlib
Bitcoin and other Crypto currencies Library for Python Read the full documentation at: The bitcoinlibrary contains a wallet implementation using sqlalchemy and sqllite3 to import, create and managekeys in a Hierarchical Deterministic Way. Example: Create wallet and generate new key to receive bitcoins >>> from bitcoinlib.wallets import HDWallet>>> w = HDWallet.create('Wallet1')>>> w
Lets Enhance! How We Found @rogerkvers $1,000 Wallet Obfuscated Privatekey
Lets Enhance! How we found @rogerkvers $1,000 wallet obfuscated privatekey Part of the documentary where Roger Ver gives the details of the Bitcoin wallet. Before we even start: We do not know the journalists who recorded the interview and we do not know Roger Ver. Anyone who had access to this video could have retrieved the private key. We could have simply named this post How great QR code are and how we recovered one from almost nothing. But its much more interesting when the QR code is the key to a $1000 Bitcoin Cash wallet. Bitcoin, Ethereum, Litecoin, Dash, Neo Cryptocurrencies are all over and are moving fast. I have been following Bitcoin since 2013 (following doesnt mean buying), had to read Mastering Bitcoin 3 times to understand how each part of it really works and be able to explain it to someone else. Still, I cant keep up with the market, new cryptocurrencies, new forks, new ICOs everywhere, every day. Its easy to start using cryptocurrencies by following a tutorial online. Download a random wallet app, generate a random pair of keys and buy some crypto on a random exchange but the cryptocurrencies learning curve is difficult. If you dont fully understand how all parts of this work you should avoid cryptocurrencies. If you dont, you risk losing your money by falling in one of the many pitfalls. One of them, keeping your private key secure, is the subject of this post. The first rule of Crypto Club is: You do not share your privatekey. The most precious thing you have when you own cryptocurrencies is your private key. If you lose your private key, you lose your money. If someone gets access to your private key, you lose your money. Simple. With this real-world example will show you step by step how we recovered the private key of the $1000 Bitcoin wallet cContinue reading >>
Bitcoin Address Generator In Obfuscated Python
Bitcoin Address Generator in Obfuscated Python Recently, I became interested in the inner workings of Bitcoin specifically, the way it uses elliptic curve cryptography to generate Bitcoin addresses such as 1PreshX6QrHmsWbSs8pHpz6kLRcj9kdPy6. It inspired me to write another obfuscated Python script. The following is valid Python code: _ =r''A(W/2,*M(3*G *G*V(2*J%P),G,J,G)+((M((J-T )*V((G-S)%P),S,T,G)if([email protected](G,J))if( W%[email protected](S,T)))if([email protected](S,T);H=2**256;import&h ashlib&as&h,os,re,bi nascii&as&k;J$:int( k.b2a_hex(W),16);C$:C (W/ 58)+[W%58]if([email protected] [];X=h.new('rip em d160');Y$:h.sha25 6(W).digest();I$ d=32:I(W/256,d-1)+ chr(W%256)if(d>[email protected]'; U$:J(k.a2b_base 64(W));f=J(os.urando m(64)) %(H-U('AUVRIxlQt1/EQC2hcy/JvsA='))+ 1;M$Q,R,G :((W*W-Q-G)%P,(W*(G+2*Q-W*W)-R)%P) ;P=H-2** 32-977;V$Q=P,L=1,O=0:V(Q%W,W,O-Q/W* L,L)if([email protected]%P;S,T=A(f,U('eb5mfvncu6 xVoGKVzocLBwKb/NstzijZWfKBWxb4F5g='), U('SDra dyajxGVdpPv8DhEIqP0XtEimhVQZnEfQj/ sQ1Lg='), 0,0);F$:'1'+F(W [1:])if(W[:1 ]'0'@' .join(map(B,C( J(W))));K$: F(W +Y(Y(W))[:4]); X.update(Y('4'+ I(S)+I(T)));B$ :re.sub('[0OIl _]| [^w]',','.jo in(map(chr,ra nge (123))))[W];print'Addre ss:',K('0'+X.dig est())+'nPrivkey:',K( 'x80'+I(f))'';exec(reduce(lambda W,X: W.replace(*X),zip(' [email protected]',[',', ' ','=lambda W,',')else ']) ,'A$G,J,S,T:'+_)) Python 2.5 2.7 is required. Each time you run this script, it generates a Bitcoin address with a matching private key. So, whats going on here? Basically, this little script gives you the ability to throw some money around. Obviously, I dont recommend doing so. I just think its cool that such a thing is even possible. Allow me to demonstrate. Sending Bitcoins to One of These Addresses To show that the above Python script generates working Bitcoin addresses, Ill go ahead and send 0.2 BTC thats currently ov Continue reading >>
How Do I Create Private Keys And Public Keys For The Bitpay Api?
A URI can be added to pair with the test server. The BitPay server requires a public and private key which are used for all client interaction with the server. The public key is used to derive the client identity and to securely sign all API requests from the client. Storing your private key is necessary. Depending on your circumstances, there are two methods to create a private key, internally or externally (and inject the key into the SDK). Store the private key, as it is necessary, and inject it into the SDK: Create the Private Key outside of the SDK: To create a SIN using PHP, you must first create your keypair - or your private and public key. You will then use your keypair to derive your SIN. When creating your keypair and SIN, you must be sure to save your private key. //Include autoload, as its a necessary component //Create your private_key and public_key objects $private_key = new BitpayPrivateKey(./api.key'); // Assign a value to the private_key object // Associate private_key with public_key, and then assign a $public_key->setPrivateKey($private_key); $manager = new BitpayKeyManager(new BitpayStorage Run the following to get the SIN from the pem file: sin = Bitpay::KeyUtils.generate_sin_from_pem(pem) Pairing a client in Ruby can be done using the PEM, OpenSSL, and the irb(interactive Ruby) tool. Open the irb tool and import the bitpay_sdk: Create your client: (Negate the api_uri parameter to create a client on our live server. Note that for this example, we are pairing to BitPay's Test server.) client = BitPay::SDK::Client.new(api_uri: 'pem: File.read('pem.pem'), insecure: true) => {'data'=>[{'policies'=>[{'policy'=>'id', 'method'=> 'inactive', 'params'=>['Tf49SFeiUAtytFEW2EUqZgWj32nP51PK73M']}], 'token'=>'BKQyVdaGQZAArdkkSuvtZN5gcN2355c8vXLj5eFPkfuKContinue reading >>
Brainwallets: From The Password To The Address
Brainwallets: from the password to the address Brainwallets are Bitcoin wallets generated uniquely from a passphrase that the users keeps in his mind so that it is required and sufficient to move the funds. But what is actually the process that takes a password and spits a Bitcoin wallet address? Lets dissect it. So, we have a password, but we need a fixed-size (256-bit) secret value to make our private key. This step can be done in a number of ways as it boils down to hashing the password but is crucial to the strength of the resulting brainwallet. Lets have a look at how popular Brainwallet generators do it. (As of 20131204) A lot of them just take the unsalted SHA256 hash of the password. This is wrong. Because SHA256 is fast and that means that an attacker can pregenerate huge tables of all possible brainwallets to monitor and empty them (Spoiler: they do). This kind of thing turning a human supplied password into a public hash is exactly what password stretching are for, and not using them here is an oversight as bad as not using them to store website user passwords, if not worse since here the hashes (the addresses) are public by default. (Hint: use WarpWallet . Its built by people who know what they are doing, and employs a proper KDF, making attacking your wallet really difficult.) 2. From the secret value to a private key This is step is trivial. Actually, the output of the hashing above taken as a 256-bit unsigned number is already the private key, what is commonly called the secret exponent. But we are used to see those pretty private keys beginning with a 5, so lets see how it is encoded. That format is called WIF, Wallet import format , and it is pretty handy as it has checksumming built in and employs a charset without confusing characters ( Base58Check )Continue reading >>
Generate Public Key From Private Key Online Bitcoin Wallet
Generate A Bitcoin Address And Private Key
Generate a bitcoin address and private key I need your help. I dont found a Bitcoin address generator written in autoit, and i really can not write it. I am a beginner, but i learning continously. I found a graphical generator, looks nice, but i think is impossible to do it I found the code on many languages, C, python, etc, but i dont understand, i really dont know how to.... Can anybody make me a script what generate a BTC address & its private key? I would be happy if somebody can help me and make it in autoit. So let me try to get this clear: you want us to reinvent the wheel for you? I just ask for help... Maybe it is a very easy task for somebody, or maybe somebody have a finished script. If you dont want or can not help, You can skip this topic. Did you have a look at the C code you posted the link to? Do you think it is a simple task to translate to AutoIt? Another question: Why does it have to be written in AutoIt? You have already found code in other languages. PowerPoint (2015-06-06 - Version 0.0.5.0) - Download - General Help & Support noo, i dont think that it is an easy task.. For me looks like a nightmare. But found two short python code, so ithink there is a shorter/easier way to do it. I need it in autoit, because i can use only this language. And i want to mod/upgrade it. But i can not do that on another language. My second idea is implement or convert python to autoit. But maybe it is a bad idea. Well, When you say you are only able to do it in AutoIt3 then I am sure you have started the coding and have something to show ...right? I need your help. I dont found a Bitcoin address generator written in autoit, and i really can not write it. I am a beginner, but i learning continously. ssl = ctypes.cdll.LoadLibrary (ctypes.util.find_library ('ssl') or 'lContinue reading >>
Mini Private Key Format
Comparison of QR codes of the same private key, encoded in mini private key format (left) and wallet import format (right). Both codes have the same dot density and error correction level, but the mini key is 57% of the full code's size. File:Redeemed Denarium physical bitcoin.jpg A minikey in a small space on a physical bitcoin The mini private key format is a method of encoding a Bitcoin private key in as few as 30 characters for the purpose of being embedded in a small space. A private key encoded in this format is called a minikey. This private key format was designed for and first used in Casascius physical bitcoins , and is also favorable for use in QR codes. The fewer characters encoded in a QR code, the lower dot density can be used, as well as more dots allocated to error correction in the same space, significantly improving readability and resistance to damage. The mini private key format offers its own built-in check code as a small margin of protection against typos. Casascius Series 1 holograms use a 22-character variant of the minikey format, instead of 30 characters. Everything is the same other than the length. To properly implement minikey redemption, services and clients must support the 30-character format, but may optionally support the 22-character format as well to allow redemption of old Casascius coins. Use of the 22-character format for future applications is discouraged due to security considerations; the standard 30-character format should be used instead. An example key using this encoding is S6c56bnXQiBjk9mqSYE7ykVQ7NzrRy. Minikeys are used extensively on physical bitcoins, because their small size allows them to be printed and read easily even on tiny surfaces inside the coins. Typically, a small paper or plastic disc is placed behind a ta Continue reading >>
Generating A Bitcoin Private Key And Address | Show Me The Code! - By Davanum Srinivas
Generating a Bitcoin Private Key andAddress Filed under: bitcoin Davanum Srinivas @ 11:30 am Ken Shirriffs blog post here has an excellent introduction to Bitcoin. One of his code snippets shows a sample python code to generate a private key in WIF format and an address. I tweaked it just a bit to replace usage of pythons random module with os.urandom and stripped it down to just whats needed to show the exponent, private key and address. Heres the effort in a gist: Fill in your details below or click an icon to log in: Email (required) (Address never made public) You are commenting using your WordPress.com account. ( LogOut / Change ) You are commenting using your Google+ account. ( LogOut / Change ) You are commenting using your Twitter account. ( LogOut / Change ) You are commenting using your Facebook account. ( LogOut / Change ) assertNotEqual('Davanum Srinivas' , 'Huawei'); RT @ knelson92 : There are so many amazing people in our community and there so many that move mountains for us without getting the recogniti 3hoursago RT @ ArneWiebalck : We have now more than 1'000 nodes managed with #OpenStack #Ironic in the #CERN cloud! 3hoursago Great news on debian packages for the Queens OpenStack ... 'The new stuff is ... the full switch Python 3!' twitter.com/i/web/status/9 12hoursago RT @ bdelacretaz : Its @ TheASF s 19th birthday! Blog post at blogs.apache.org/foundation/ent with impressive numbers and quotes from a number of pe 13hoursago RT @ OpenStack : Want more #Kubernetes ? Get 60+ #K8s workshops and talks at the Vancouver Summit, May 21-24. Early bird pricing--full week fo 1dayagoContinue reading >>
Messing With Bitcoin Keys And Addresses
The bu tool is obsolete, which makes this post not-so-useful. Look at this file instead. The command line utility bu (for Bitcoin utilities) is included with my Python-based pycoin library. This utility makes it easy to deal with Bitcoin private keys and addresses in their native and various intermediate formats. Lets go through some examples. The most basic form of a Bitcoin private key is simply an integer between 1 and 115792089237316195423570985008687907852837564279074904382605163141518161494336 1.15e77 (inclusive). Thats it! This integer is a secret exponent, because generating the public key involves exponentiation, and there is no known way to go from the public key to the secret exponent. Lets take a look at the very first private key, also known as 1. $ bu 1secret exponent: 1 hex: 1WIF: KwDiBf89QgGbjEhKnhXJuH7LrciVrZi3qYjgd9M7rFU73sVHnoWn uncompressed: 5HpHagT65TZzG1PH3CSu63k8DbpvD8s5ip4nEB3kEsreAnchuDfpublic pair x: 55066263022277343669578718895168534326250603453777594175500187360389116729240public pair y: 32670510020758816978083085130507043184471273380659243275938904335757337482424 x as hex: 79be667ef9dcbbac55a06295ce870b07029bfcdb2dce28d959f2815b16f81798 y as hex: 483ada7726a3c4655da4fbfc0e1108a8fd17b448a68554199c47d08ffb10d4b8y parity: evenkey pair as sec: 0279be667ef9dcbbac55a06295ce870b07029bfcdb2dce28d959f2815b16f81798 uncompressed: 0479be667ef9dcbbac55a06295ce870b07029bfcdb2dce28d959f2815b16f81798 483ada7726a3c4655da4fbfc0e1108a8fd17b448a68554199c47d08ffb10d4b8hash160: 751e76e8199196d454941c45d1b3a323f1433bd6 uncompressed: 91b24bf9f5288532960ac687abb035127b1d28a5Bitcoin address: 1BgGZ9tcN4rm9KBzDn7KprQz87SZ26SAMH uncompressed: 1EHNa6Q4Jz2uvNExL497mE43ikXhwF6kZm You can see from blockchain.info that the addresses corresponding to this private key ( 1BgContinue reading >>
Generating Bitcoin Key Pair In Python 3.6 From Public Key To Public Address
I have a question about a script I am trying to write that generates a key pair for Bitcoin adreses. I came as far as generating a random private key and generate a public key. I know (or think really much?) that my first part of code is correct. When I go to bitaddress.org and check my generated private keys for details, I always get the correct generated public key. import osimport ecdsaimport binasciiprivate_key = binascii.hexlify(os.urandom(32)).decode()print('private key = ' + private_key)Private_key = bytes.fromhex(private_key)signing_key = ecdsa.SigningKey.from_string(Private_key, curve = ecdsa.SECP256k1)verifying_key = signing_key.get_verifying_key()public_key = bytes.fromhex('04') + verifying_key.to_string()print ('public key = ' + public_key.hex()) The problem is that for now Im getting the 130 characters public key and I want to transform this to a bitcoin address. I don't understand how to do this. I need to do some encoding/decoding but can't wrap my head around it.This is the explanation from the internet I found but fail to understand: Excuse me for asking; I forgot to add the code I have so far to the question but updated it. I am a novice 'developer' and am doing my utterly best to learn about it. I was under the impression that my question was specific. If it is not specific enough please specify. jimmymcgill Nov 16 '17 at 0:54 which ecdsa module are you using? James K Polk Nov 16 '17 at 1:23 Thank you for your reply! I am using ecdsa 0.13 (full name says: ecdsa-0.13+26.gc877639-py3.6.egg). jimmymcgill Nov 16 '17 at 6:49 Ok, so there are 5-10 steps in the procedure outlined. Which one are you stuck at and why? James K Polk Nov 16 '17 at 12:41 Sorry for my stupid questions. I just want to tell you I really really appreciate the fact that you are takingContinue reading >>
Mini Private Key Format
Comparison of QR codes of the same private key, encoded in mini private key format (left) and wallet import format (right). Both codes have the same dot density and error correction level, but the mini key is 57% of the full code's size. A minikey in a small space on a physical bitcoin This page contains sample addresses and/or private keys. Do not send bitcoins to or import any sample keys; you will lose your money. The mini private key format is a method of encoding a Bitcoin private key in as few as 30 characters for the purpose of being embedded in a small space. A private key encoded in this format is called a minikey. This private key format was designed for and first used in Casascius physical bitcoins , and is also favorable for use in QR codes. The fewer characters encoded in a QR code, the lower dot density can be used, as well as more dots allocated to error correction in the same space, significantly improving readability and resistance to damage. The mini private key format offers its own built-in check code as a small margin of protection against typos. Casascius Series 1 holograms use a 22-character variant of the minikey format, instead of 30 characters. Everything is the same other than the length. To properly implement minikey redemption, services and clients must support the 30-character format, but may optionally support the 22-character format as well to allow redemption of old Casascius coins. Use of the 22-character format for future applications is discouraged due to security considerations; the standard 30-character format should be used instead. An example key using this encoding is S6c56bnXQiBjk9m_SAMPLE_PRIVATE_KEY_DO_NOT_IMPORT_qSYE7ykVQ7NzrRy. Paper disc inserts for Casascius coins with minikeys on the obverse (top) and corresponding addreContinue reading >>
Using Pythons Bitcoin Libraries In Elixir | Floor And Varnish
Using Python's Bitcoin libraries in Elixir Note: This post contains affiliate links. See my disclosure about affiliate links here . Im currently attempting to learn about the technical details of Bitcoin andblockchains by reading Mastering Bitcoin: Programming the Open Blockchain . All the code examples in the book are in C++ and Python , but I wanted tosee if I could port them over to Elixir . There are Bitcoin libraries inElixir, like bitcoin-elixir , but I could not seem to find equivalents to theones used in the book. So, I thought that I would try to port as much of thecode as possible into Elixir, and then see if I could make API-style callouts tocode that I could not. I have not been able to find a way to get Elixir to talk to C++ librarieslike Libbitcoin , which are used in the book (if you have a good method,please let me know in the comments! [Update 14 Dec 2017: I figured it out. See Using C++ Bitcoin Libraries in Elixir ]), so this post will focus ongetting Elixir to talk to Pythons Pybitcointools library, within thecontext of the Implementing Keys and Addresses section in Chapter 4 of thebook, using the code in Example 4-5 . The Python example uses the Pybitcointools library to generate a private key , and then encode it into different formatslike Wallet Import Format (WIF), and Bitcoin Address (which representsa destination for a Bitcoin payment). The full example code from the book is asfollows, so see if you can draw some mental lines around what code can comeover to Elixir, and what potentially needs to stay in Python: # key-to-address-ecc-example.pyfrom __future__ import print_functionimport bitcoin# Generate a random private keyvalid_private_key = Falsewhile not valid_private_key: private_key = bitcoin.random_key() decoded_private_key = bitcoin.decodContinue reading >>
Learn Bitcoin-python #1 - Installation Guide, Basic Commands
Step-1: Install the Python directly via Anaconda Step-2: Now, pip library is installed. If not, use conda install pip in your command prompt (for Windows). Step-3: Use the command pip install bitcoin to install bitcoin in your system. In my case, the Bitcoin is already installed. NOTE: The best part in this installation is that we can fetch the Bitcoin related data w/o being a full node i.e. downloading the entire Bitcoin-blockchain (approx. 150 GB size till date). Please find here for recent size. This Py-bitcoin fetches the data from 'Blockchain.info' API. Here, Python coding can be done in 2 ways: - Now, the notebook opens in the browser as follows: # import bitcoin from bitcoin import*# Generate private keymy_private_key = random_key()print('My private key: ' + my_private_key)# Generate public keymy_public_key = privtopub(my_private_key)print('My public key: ' + my_public_key) Here, are a few basic commands to use Bitcoin protocol. First, we need to import the bitcoin library like this - my_private_key = random_key()print('My private key: ' + my_private_key) my_public_key = privtopub(my_private_key)print('My public key: ' + my_public_key) Create a bitcoin wallet address. Unlike Email id - Each time bitcoin address can be generated for each transaction. my_address = pubtoaddr(my_public_key)print('My address: ' + my_address) This require multiple private-public keys. Application: In organizations, suppose there is a account accessed by multiple members. Suppose, someone wants to make any transaction using that wallet address. In this case, we can use multi-signature wallet in order to unanimously decide on transactions happening from the company's wallet address. Hence, it would requrie the signature of each member. Therefore, account security is enhanced. # Create pContinue reading >>
A Bitcoin wallet can refer to either a wallet program or a wallet file.
Introductions¶
Wallet programs create public keys to receive satoshis and use the corresponding private keys to spend those satoshis. Wallet files store private keys and (optionally) other information related to transactions for the wallet program.
Wallet programs and wallet files are addressed below in separate subsections, and this document attempts to always make it clear whether we’re talking about wallet programs or wallet files.
Wallet Programs¶
Permitting receiving and spending of satoshis is the only essential feature of wallet software—but a particular wallet program doesn’t need to do both things. Two wallet programs can work together, one program distributing public keys in order to receive satoshis and another program signing transactions spending those satoshis.
Wallet programs also need to interact with the peer-to-peer network to get information from the block chain and to broadcast new transactions. However, the programs which distribute public keys or sign transactions don’t need to interact with the peer-to-peer network themselves.
This leaves us with three necessary, but separable, parts of a wallet system: a public key distribution program, a signing program, and a networked program. In the subsections below, we will describe common combinations of these parts.
Note: we speak about distributing public keys generically. In many cases, P2PKH or P2SH hashes will be distributed instead of public keys, with the actual public keys only being distributed when the outputs they control are spent.
Full-Service Wallets¶
The simplest wallet is a program which performs all three functions: it generates private keys, derives the corresponding public keys, helps distribute those public keys as necessary, monitors for outputs spent to those public keys, creates and signs transactions spending those outputs, and broadcasts the signed transactions.
As of this writing, almost all popular wallets can be used as full-service wallets.
The main advantage of full-service wallets is that they are easy to use. A single program does everything the user needs to receive and spend satoshis.
The main disadvantage of full-service wallets is that they store the private keys on a device connected to the Internet. The compromise of such devices is a common occurrence, and an Internet connection makes it easy to transmit private keys from a compromised device to an attacker.
To help protect against theft, many wallet programs offer users the option of encrypting the wallet files which contain the private keys. This protects the private keys when they aren’t being used, but it cannot protect against an attack designed to capture the encryption key or to read the decrypted keys from memory.
Signing-Only Wallets¶
To increase security, private keys can be generated and stored by a separate wallet program operating in a more secure environment. These signing-only wallets work in conjunction with a networked wallet which interacts with the peer-to-peer network.
Signing-only wallets programs typically use deterministic key creation (described in a later subsection) to create parent private and public keys which can create child private and public keys.
When first run, the signing-only wallet creates a parent private key and transfers the corresponding parent public key to the networked wallet.
The networked wallet uses the parent public key to derive child public keys, optionally helps distribute them, monitors for outputs spent to those public keys, creates unsigned transactions spending those outputs, and transfers the unsigned transactions to the signing-only wallet.
Often, users are given a chance to review the unsigned transactions’ details (particularly the output details) using the signing-only wallet.
After the optional review step, the signing-only wallet uses the parent private key to derive the appropriate child private keys and signs the transactions, giving the signed transactions back to the networked wallet.
The networked wallet then broadcasts the signed transactions to the peer-to-peer network.
The following subsections describe the two most common variants of signing-only wallets: offline wallets and hardware wallets.
Offline Wallets¶
Several full-service wallets programs will also operate as two separate wallets: one program instance acting as a signing-only wallet (often called an “offline wallet”) and the other program instance acting as the networked wallet (often called an “online wallet” or “watching-only wallet”).
The offline wallet is so named because it is intended to be run on a device which does not connect to any network, greatly reducing the number of attack vectors. If this is the case, it is usually up to the user to handle all data transfer using removable media such as USB drives. The user’s workflow is something like:
(Offline) Disable all network connections on a device and install the wallet software. Start the wallet software in offline mode to create the parent private and public keys. Copy the parent public key to removable media.
(Online) Install the wallet software on another device, this one connected to the Internet, and import the parent public key from the removable media. As you would with a full-service wallet, distribute public keys to receive payment. When ready to spend satoshis, fill in the output details and save the unsigned transaction generated by the wallet to removable media.
(Offline) Open the unsigned transaction in the offline instance, review the output details to make sure they spend the correct amount to the correct address. This prevents malware on the online wallet from tricking the user into signing a transaction which pays an attacker. After review, sign the transaction and save it to removable media.
(Online) Open the signed transaction in the online instance so it can broadcast it to the peer-to-peer network.
The primary advantage of offline wallets is their possibility for greatly improved security over full-service wallets. As long as the offline wallet is not compromised (or flawed) and the user reviews all outgoing transactions before signing, the user’s satoshis are safe even if the online wallet is compromised.
The primary disadvantage of offline wallets is hassle. For maximum security, they require the user dedicate a device to only offline tasks. The offline device must be booted up whenever funds are to be spent, and the user must physically copy data from the online device to the offline device and back.
Hardware Wallets¶
Hardware wallets are devices dedicated to running a signing-only wallet. Their dedication lets them eliminate many of the vulnerabilities present in operating systems designed for general use, allowing them to safely communicate directly with other devices so users don’t need to transfer data manually. The user’s workflow is something like:
(Hardware) Create parent private and public keys. Connect hardware wallet to a networked device so it can get the parent public key.
(Networked) As you would with a full-service wallet, distribute public keys to receive payment. When ready to spend satoshis, fill in the transaction details, connect the hardware wallet, and click Spend. The networked wallet will automatically send the transaction details to the hardware wallet.
(Hardware) Review the transaction details on the hardware wallet’s screen. Some hardware wallets may prompt for a passphrase or PIN number. The hardware wallet signs the transaction and uploads it to the networked wallet.
(Networked) The networked wallet receives the signed transaction from the hardware wallet and broadcasts it to the network.
The primary advantage of hardware wallets is their possibility for greatly improved security over full-service wallets with much less hassle than offline wallets.
The primary disadvantage of hardware wallets is their hassle. Even though the hassle is less than that of offline wallets, the user must still purchase a hardware wallet device and carry it with them whenever they need to make a transaction using the signing-only wallet.
An additional (hopefully temporary) disadvantage is that, as of this writing, very few popular wallet programs support hardware wallets—although almost all popular wallet programs have announced their intention to support at least one model of hardware wallet.
Distributing-Only Wallets¶
Wallet programs which run in difficult-to-secure environments, such as webservers, can be designed to distribute public keys (including P2PKH or P2SH addresses) and nothing more. There are two common ways to design these minimalist wallets:
Pre-populate a database with a number of public keys or addresses, and then distribute on request a pubkey script or address using one of the database entries. To avoid key reuse, webservers should keep track of used keys and never run out of public keys. This can be made easier by using parent public keys as suggested in the next method.
Use a parent public key to create child public keys. To avoid key reuse, a method must be used to ensure the same public key isn’t distributed twice. This can be a database entry for each key distributed or an incrementing pointer to the key index number.
Neither method adds a significant amount of overhead, especially if a database is used anyway to associate each incoming payment with a separate public key for payment tracking. See the Payment Processing section for details.
Wallet Files¶
Bitcoin wallets at their core are a collection of private keys. These collections are stored digitally in a file, or can even be physically stored on pieces of paper.
Private Key Formats¶
Private keys are what are used to unlock satoshis from a particular address. In Bitcoin, a private key in standard format is simply a 256-bit number, between the values:
0x01 and 0xFFFF FFFF FFFF FFFF FFFF FFFF FFFF FFFE BAAE DCE6 AF48 A03B BFD2 5E8C D036 4140, representing nearly the entire range of 2256-1 values. The range is governed by the secp256k1ECDSA encryption standard used by Bitcoin.
Wallet Import Format (WIF)¶
In order to make copying of private keys less prone to error, Wallet Import Format may be utilized. WIF uses base58Check encoding on a private key, greatly decreasing the chance of copying error, much like standard Bitcoin addresses.
Take a private key.
Add a 0x80 byte in front of it for mainnet addresses or 0xef for testnet addresses.
Append a 0x01 byte after it if it should be used with compressed public keys (described in a later subsection). Nothing is appended if it is used with uncompressed public keys.
Perform a SHA-256 hash on the extended key.
Perform a SHA-256 hash on result of SHA-256 hash.
Take the first four bytes of the second SHA-256 hash; this is the checksum.
Add the four checksum bytes from point 5 at the end of the extended key from point 2.
Convert the result from a byte string into a Base58 string using Base58Check encoding.
The process is easily reversible, using the Base58 decoding function, and removing the padding.
Mini Private Key Format¶
Mini private key format is a method for encoding a private key in under 30 characters, enabling keys to be embedded in a small physical space, such as physical bitcoin tokens, and more damage-resistant QR codes.
The first character of mini keys is ‘S’.
In order to determine if a mini private key is well-formatted, a question mark is added to the private key.
The SHA256 hash is calculated. If the first byte produced is a `00’, it is well-formatted. This key restriction acts as a typo-checking mechanism. A user brute forces the process using random numbers until a well-formatted mini private key is produced.
In order to derive the full private key, the user simply takes a single SHA256 hash of the original mini private key. This process is one-way: it is intractable to compute the mini private key format from the derived key.
Many implementations disallow the character ‘1’ in the mini private key due to its visual similarity to ‘l’.
Resource: A common tool to create and redeem these keys is the Casascius Bitcoin Address Utility.
Public Key Formats¶
Bitcoin ECDSA public keys represent a point on a particular Elliptic Curve (EC) defined in secp256k1. In their traditional uncompressed form, public keys contain an identification byte, a 32-byte X coordinate, and a 32-byte Y coordinate. The extremely simplified illustration below shows such a point on the elliptic curve used by Bitcoin, y2 = x3 + 7, over a field of contiguous numbers.
(Secp256k1 actually modulos coordinates by a large prime, which produces a field of non-contiguous integers and a significantly less clear plot, although the principles are the same.)
An almost 50% reduction in public key size can be realized without changing any fundamentals by dropping the Y coordinate. This is possible because only two points along the curve share any particular X coordinate, so the 32-byte Y coordinate can be replaced with a single bit indicating whether the point is on what appears in the illustration as the “top” side or the “bottom” side.
No data is lost by creating these compressed public keys—only a small amount of CPU is necessary to reconstruct the Y coordinate and access the uncompressed public key. Both uncompressed and compressed public keys are described in official secp256k1 documentation and supported by default in the widely-used OpenSSL library.
Because they’re easy to use, and because they reduce almost by half the block chain space used to store public keys for every spent output, compressed public keys are the default in Bitcoin Core and are the recommended default for all Bitcoin software.
However, Bitcoin Core prior to 0.6 used uncompressed keys. This creates a few complications, as the hashed form of an uncompressed key is different than the hashed form of a compressed key, so the same key works with two different P2PKH addresses. This also means that the key must be submitted in the correct format in the signature script so it matches the hash in the previous output’s pubkey script.
For this reason, Bitcoin Core uses several different identifier bytes to help programs identify how keys should be used:
Private keys meant to be used with compressed public keys have 0x01 appended to them before being Base-58 encoded. (See the private key encoding section above.)
Uncompressed public keys start with 0x04; compressed public keys begin with 0x03 or 0x02 depending on whether they’re greater or less than the midpoint of the curve. These prefix bytes are all used in official secp256k1 documentation.
Hierarchical Deterministic Key Creation¶
The hierarchical deterministic key creation and transfer protocol (HD protocol) greatly simplifies wallet backups, eliminates the need for repeated communication between multiple programs using the same wallet, permits creation of child accounts which can operate independently, gives each parent account the ability to monitor or control its children even if the child account is compromised, and divides each account into full-access and restricted-access parts so untrusted users or programs can be allowed to receive or monitor payments without being able to spend them.
The HD protocol takes advantage of the ECDSA public key creation function, “point()”, which takes a large integer (the private key) and turns it into a graph point (the public key):
Because of the way “point()” works, it’s possible to create a child public key by combining an existing (parent) public key with another public key created from any integer (i) value. This child public key is the same public key which would be created by the “point()” function if you added the i value to the original (parent) private key and then found the remainder of that sum divided by a global constant used by all Bitcoin software (p):
This means that two or more independent programs which agree on a sequence of integers can create a series of unique child key pairs from a single parent key pair without any further communication. Moreover, the program which distributes new public keys for receiving payment can do so without any access to the private keys, allowing the public key distribution program to run on a possibly-insecure platform such as a public web server.
Child public keys can also create their own child public keys (grandchild public keys) by repeating the child key derivation operations:
Whether creating child public keys or further-descended public keys, a predictable sequence of integer values would be no better than using a single public key for all transactions, as anyone who knew one child public key could find all of the other child public keys created from the same parent public key. Instead, a random seed can be used to deterministically generate the sequence of integer values so that the relationship between the child public keys is invisible to anyone without that seed.
The HD protocol uses a single root seed to create a hierarchy of child, grandchild, and other descended keys with unlinkable deterministically-generated integer values. Each child key also gets a deterministically-generated seed from its parent, called a chain code, so the compromising of one chain code doesn’t necessarily compromise the integer sequence for the whole hierarchy, allowing the master chain code to continue being useful even if, for example, a web-based public key distribution program gets hacked.
Overview Of Hierarchical Deterministic Key Derivation¶
As illustrated above, HD key derivation takes four inputs:
The parent private key and parent public key are regular uncompressed 256-bit ECDSA keys.
The parent chain code is 256 bits of seemingly-random data.
The index number is a 32-bit integer specified by the program.
In the normal form shown in the above illustration, the parent chain code, the parent public key, and the index number are fed into a one-way cryptographic hash (HMAC-SHA512) to produce 512 bits of deterministically-generated-but-seemingly-random data. The seemingly-random 256 bits on the righthand side of the hash output are used as a new child chain code. The seemingly-random 256 bits on the lefthand side of the hash output are used as the integer value to be combined with either the parent private key or parent public key to, respectively, create either a child private key or child public key:
Specifying different index numbers will create different unlinkable child keys from the same parent keys. Repeating the procedure for the child keys using the child chain code will create unlinkable grandchild keys.
Because creating child keys requires both a key and a chain code, the key and chain code together are called the extended key. An extended private key and its corresponding extended public key have the same chain code. The (top-level parent) master private key and master chain code are derived from random data, as illustrated below.
Creating A Root Extended Key Pair¶
A root seed is created from either 128 bits, 256 bits, or 512 bits of random data. This root seed of as little as 128 bits is the only data the user needs to backup in order to derive every key created by a particular wallet program using particular settings.
Warning: As of this writing, HD wallet programs are not expected to be fully compatible, so users must only use the same HD wallet program with the same HD-related settings for a particular root seed.
The root seed is hashed to create 512 bits of seemingly-random data, from which the master private key and master chain code are created (together, the master extended private key). The master public key is derived from the master private key using “point()”, which, together with the master chain code, is the master extended public key. The master extended keys are functionally equivalent to other extended keys; it is only their location at the top of the hierarchy which makes them special.
Hardened Keys¶
Hardened extended keys fix a potential problem with normal extended keys. If an attacker gets a normal parent chain code and parent public key, he can brute-force all chain codes deriving from it. If the attacker also obtains a child, grandchild, or further-descended private key, he can use the chain code to generate all of the extended private keys descending from that private key, as shown in the grandchild and great-grandchild generations of the illustration below.
Perhaps worse, the attacker can reverse the normal child private key derivation formula and subtract a parent chain code from a child private key to recover the parent private key, as shown in the child and parent generations of the illustration above. This means an attacker who acquires an extended public key and any private key descended from it can recover that public key’s private key and all keys descended from it.
For this reason, the chain code part of an extended public key should be better secured than standard public keys and users should be advised against exporting even non-extended private keys to possibly-untrustworthy environments.
This can be fixed, with some tradeoffs, by replacing the normal key derivation formula with a hardened key derivation formula.
The normal key derivation formula, described in the section above, combines together the index number, the parent chain code, and the parent public key to create the child chain code and the integer value which is combined with the parent private key to create the child private key.
Creating Child Public Keys From An Extended Private Key¶
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The hardened formula, illustrated above, combines together the index number, the parent chain code, and the parent private key to create the data used to generate the child chain code and child private key. This formula makes it impossible to create child public keys without knowing the parent private key. In other words, parent extended public keys can’t create hardened child public keys.
Because of that, a hardened extended private key is much less useful than a normal extended private key—however, hardened extended private keys create a firewall through which multi-level key derivation compromises cannot happen. Because hardened child extended public keys cannot generate grandchild chain codes on their own, the compromise of a parent extended public key cannot be combined with the compromise of a grandchild private key to create great-grandchild extended private keys.
The HD protocol uses different index numbers to indicate whether a normal or hardened key should be generated. Index numbers from 0x00 to 0x7fffffff (0 to 231-1) will generate a normal key; index numbers from 0x80000000 to 0xffffffff will generate a hardened key. To make descriptions easy, many developers use the prime symbol to indicate hardened keys, so the first normal key (0x00) is 0 and the first hardened key (0x80000000) is 0´.
(Bitcoin developers typically use the ASCII apostrophe rather than the unicode prime symbol, a convention we will henceforth follow.)
This compact description is further combined with slashes prefixed by m or M to indicate hierarchy and key type, with m being a private key and M being a public key. For example, m/0’/0/122’ refers to the 123rd hardened private child (by index number) of the first normal child (by index) of the first hardened child (by index) of the master private key. The following hierarchy illustrates prime notation and hardened key firewalls.
Wallets following the BIP32 HD protocol only create hardened children of the master private key (m) to prevent a compromised child key from compromising the master key. As there are no normal children for the master keys, the master public key is not used in HD wallets. All other keys can have normal children, so the corresponding extended public keys may be used instead.
The HD protocol also describes a serialization format for extended public keys and extended private keys. For details, please see the wallet section in the developer reference or BIP32 for the full HD protocol specification.
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Storing Root Seeds¶
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Root seeds in the HD protocol are 128, 256, or 512 bits of random data which must be backed up precisely. To make it more convenient to use non-digital backup methods, such as memorization or hand-copying, BIP39 defines a method for creating a 512-bit root seed from a pseudo-sentence (mnemonic) of common natural-language words which was itself created from 128 to 256 bits of entropy and optionally protected by a password.
The number of words generated correlates to the amount of entropy used:
Entropy Bits | Words |
|---|---|
128 | 12 |
160 | 15 |
192 | 18 |
224 | 21 |
256 | 24 |
The passphrase can be of any length. It is simply appended to the mnemonic pseudo-sentence, and then both the mnemonic and password are hashed 2,048 times using HMAC-SHA512, resulting in a seemingly-random 512-bit seed. Because any input to the hash function creates a seemingly-random 512-bit seed, there is no fundamental way to prove the user entered the correct password, possibly allowing the user to protect a seed even when under duress.
For implementation details, please see BIP39.
Loose-Key Wallets¶
Loose-Key wallets, also called “Just a Bunch Of Keys (JBOK)”, are a deprecated form of wallet that originated from the Bitcoin Core client wallet. The Bitcoin Core client wallet would create 100 private key/public key pairs automatically via a Pseudo-Random-Number Generator (PRNG) for later use.
These unused private keys are stored in a virtual “key pool”, with new keys being generated whenever a previously-generated key was used, ensuring the pool maintained 100 unused keys. (If the wallet is encrypted, new keys are only generated while the wallet is unlocked.)
This created considerable difficulty in backing up one’s keys, considering backups have to be run manually to save the newly-generated private keys. If a new key pair set is generated, used, and then lost prior to a backup, the stored satoshis are likely lost forever. Many older-style mobile wallets followed a similar format, but only generated a new private key upon user demand.
This wallet type is being actively phased out and discouraged from being used due to the backup hassle.