Breaking the Compromise Between Security and Convenience in Cryptocurrency

Henry Vogel
Jun 18 · 7 min read

I’m Henry Vogel, co-founder and investor in Keevo. I want to introduce you to some of the amazing people on the Keevo team and explain a few things about our project including why we’re building Keevo and why we think Keevo is a significant step forward in cryptocurrency security and convenience.

The Keevo team is over 20 engineers, co-founders, contributors and co-investors. We’re a group of experienced entrepreneurs, blockchain developers, security experts, designers and crypto investors and enthusiasts.

You can see some of the team on our About page or chat with us on Telegram or Twitter.

Together, the Keevo team has over 200 years of cumulative experience working for companies like Google, Amazon, AWS, Cisco, Texas Instruments, Nike, FitBit, Boston Scientific, eBay, Yahoo, AltaVista, Apptera and more.

Some of us started mining Bitcoin and other cryptocurrencies as early as 2014. Others have been advising and investing in various startups in the blockchain space. Many of our developers, industrial and product designers, product managers, operations and business teams have known each other and worked together for years on various endeavors including a new enterprise blockchain platform for a large technology company, several DApps and other ventures.


Why we got into blockchain… and why we believe it’s the inevitable future

We’re passionate about the disruptive power of blockchain technology that enables users to securely own cryptocurrencies and easily transfer their self-sovereign digital stores of value anonymously and without the need for any 3rd party intermediary like a bank or central government. In doing so, this will unleash a new economic foundation that is going to have far reaching impact on global economies, governments, wealth distribution and the balance of power. And while it’s been a bit of a “crypto winter” with the value of Bitcoin, Ether and other altcoins coming down over 75% off their peaks since December 2017, we’ve seen a nice recovery in the past few weeks and months and still believe the blockchain revolution is just getting started.

And, beyond this financial revolution, we believe cryptocurrency is just the first use-case for blockchain technology. We see tremendous potential in applying the ability to securely digitize and provide incentives to validate transactions for many other B2C and B2B applications, industries and aspects of life.

But to reach this full potential and to truly decentralize digital identity and virtual asset management, we need to fundamentally break the compromise users are currently forced to make between security and convenience.


Breaking the compromise between security and convenience

While all actions on the blockchain are immutable and visible to all participants, much of the other data — in particular users’ private or master keys — must be kept secure. Investors, developers, miners or just regular users face many challenges when looking for a safe AND easy-to-use solution to manage their private keys which they use to own and transfer their cryptocurrencies today.

On the one hand, online exchanges and software wallets are very convenient because users can access them from almost anywhere and any device with an internet connection.

But in order to gain that ease of use, users have to give up their privacy and entrust a third party intermediary to keep their private keys and account information secure. In doing so, it’s really no different than almost any other centralized solution today like a bank or brokerage firm that holds fiat currencies, stocks and other assets in user accounts.

Unfortunately — and all-too frequently — these centralized “honey pots” have been subject to hacks and attacks. Whether it’s Mount Gox back in 2014, Coincheck last year or the attempt just recently on one of the largest exchanges, Binance, it seems no online exchange or software wallets are safe.

Moreover, your online account access stored on your laptop or mobile smartphone is equally at risk. As Kate Rooney recently reported in CNBC

Over $1.1 billion in cryptocurrency has been stolen [in the first half of 2018] and it was apparently easy to do.

Below is an analysis completed by Autonomous Research and the Wall Street Journal highlighting the growth in stolen cryptocurrencies from 2013 through the first half of 2018

Take for example, the spear phishing attacks favored by the infamous North Korean “Lazurus” hacker outfit and which are the most common type of attack on online exchanges and software wallet services. In these attacks, “fraudsters deliver malware under the cover of CV spam [with an attachment] that has a malware embedded in the document … After the local network is successfully compromised, the hackers browse the local network to find workstations and servers used working with private cryptocurrency wallets.”

Put simply, we’re all susceptible of getting hacked on exchanges and with software wallets; having an online wallet or account with an online exchange sitting on any connected computer — no matter the type of device (laptop, smart phone or pad) or security protocols in place — is constantly at risk of being infected and breached. No doubt it’s a ‘cat and mouse’ game with attack vectors and security patches, but accessing your virtual assets with a connected device is inherently compromising your security and putting your assets in jeopardy of being stolen.

Given the risk of infection to individual user’s computers, several software wallet solutions have introduced multi-sig authentication as a possible solution to thwart hackers. But, the notion of needing many on-device wallets to approve and execute transactions is very difficult to make work from a usability and security perspective. Transactions requiring multi-signature (multi-sig) and escrow can be complex to execute in various public and private blockchains. As applications scale, uncertainty around response times and availability make design and architecture difficult.

On the other hand, hardware wallets which are air-gapped, less frequently connected to the internet and which control their own operating systems with the sole purpose of protecting the encrypted data on them offer users a more secure solution. But, they’re traditionally much less convenient.

And, are the hardware wallets on the market today really safer? Based on all the wallets we’ve used, we don’t think so.


The problem with existing hardware wallets

First, almost every hardware wallet comes with the risk of failure or loss.

In most cases, those are single points of failure that are unrecoverable. As a result, almost every hardware wallet on the market suggests that its users write down and store a seed phrase, 12–24 random words in a particular order, on a piece of paper. In fact, most ship their device with a recovery seed card or booklet so you can write down and store multiple copies. This is not only inconvenient, but it’s also incredibly insecure.

In fact, we think it’s absolutely ridiculous! Just think about it. You spend all this money on a hardware technology that’s supposed to keep your private keys safe and secure, but then, you have to rely upon a piece of paper as a backup.

Really?! A piece of paper? Keeping that secure isn’t only inconvenient, it’s incredibly insecure.

Some hodlers have resorted to storing their seed phrases in metal cases like Billfodl, ColdTi, Cryptosteel and Crypto Key Stack. Some have developed detailed manuals that espouse the safety of paper while encouraging users to follow elaborate instructions for how to keep paper recovery seed phrases safe. These include storing multiple paper copies in tamper-proof, fire-resistant bags or splitting seed phrases into several different parts and securing the parts in traditional bank safety deposit boxes and home safes.

It all seems quite cumbersome and complex.

And at the end of the day, if only one person knows the password or way to piece together the recovery seed phrases and that person dies — like apparently was the case with the founder of Quadriga who died with sole access to cryptocurrency for his 115,000 account holders that was valued at hundreds of millions of dollars — then you’re out of luck.

So … how do you pass along your cryptocurrency when you die?

Turns out, with current hardware wallets, if you want to transfer your cryptocurrency to a beneficiary without sharing your private keys, seed phrases or account information with them — before you die — you can’t. It’s impossible.

Fortune recently investigated and reported on the death of one bitcoin owner whose heirs discovered his hardware wallet and knew he had made a small fortune. But, they were entirely unable to access that inheritance since he hadn’t entrusted them or anyone else with his password or seed phrase.

Many methods have cropped up to try and address this issue via third party commercial services or by using estate planners with keys to safety deposit boxes holding passwords and such, but all of these solutions require owners to entrust their executors or the beneficiaries themselves with their private information. This is incredibly inconvenient, susceptible to various points of failure and fundamentally insecure.

As crypto hodlers ourselves, we thought: there has to be a better way!

After years of development, Keevo was born to solve our own problems and hopefully yours as well.


Stay tuned for Part II in the coming days on our solution, Keevo’s Premium Plus service, technical specifications, production and delivery roadmap, partnerships, pricing, launch plan and more.

Learn more and pre-order your Keevo HERE

Invitations and product updates are being released to people who sign-up. Pre-order invitations will start going out later this month (June, 2019).

Keevowallet

The cryptocurrency hardware wallet

Henry Vogel

Written by

Keevowallet

The cryptocurrency hardware wallet

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch
Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore
Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade