Block, founded by Jack Dorsey, announced today, April 27, the launch of its second generation Bitkey, the first hardware wallet for Bitcoin to incorporate an OLED touchscreen.
The absence of a screen was the most specific security limitation of the previous generation, which launched in December 2023. Without a screen, users I relied on my phone to confirm what I was signing.is risky because a fake or compromised app could display one address on your phone and send funds to another address. Bitkey’s new hardware wallet screen solves that problem by showing transaction details directly from the hardware, without going through your phone.
According to the announcement, this screen is not limited to confirming transactions. Also, Confirm security settings changes– Spending limits, recovery contacts, inheritance settings and notifications. Each of these settings is an important security decision that could not be verified directly on the device in previous generations.
The device costs about $250, measures 66 x 60 x 13.6 mm, weighs 79 grams, and has a Corian exterior, the same material used for industrial kitchen surfaces known for its durability. It connects to your phone via NFC (Near Field Communication, a short-range technology that doesn’t require cables) and charges via USB-C. The battery will last up to a year on a single charge, Block said.
Other features of the previous model remain unchanged. According to the statement, Bitkey uses a 2-of-3 multisig (multisignature) scheme, where three keys control the wallet, but only two are needed to approve a transaction. One key resides on the hardware and one resides on the user’s phone And a third is on Block’s servers. A fingerprint is required to access the hardware, but the key never leaves the device.
Debate over models without recovery phrases
The most contentious aspects of Bitkey’s design remain, according to user responses to the company’s posts about X No recovery phrase (seed phrase)which is a series of words that in most wallets allows users to rebuild their keys if they lose their device.
Block answers this question with three arguments in a technical document published alongside the announcement.
- First, recovery phrases are the main vector of social aggression in self-custody. This is a plaintext secret that cannot be protected by hardware once it exists, so removing it eliminates the target for the most common types of attacks. Phishing.
- Second, users can exit at any time without relying on blocks via an emergency escape kit. It is a mechanism that allows transactions to be constructed and signed using only two of the user’s keys: a hardware key and a phone key, without the intervention of a company’s servers. The code is public and there is a separate app on GitHub to run it.
- Third, Block cannot see your balance or history. Thanks to a technology called chain code delegation proposed by the Bitkey team as an open standard (BIP-89), Block servers do not have the ability to reconstruct the complete history of a wallet and only access the minimal information of each transaction that it co-signs.
Block’s own whitepaper acknowledges that the no-recovery-phrase model includes the following problems: trade off. Users cannot reconstruct wallets from a single word sequence. Instead, recovery relies on three alternative mechanisms depending on the scenario.
- If the user loses their mobile phone, Application keys can be recovered from the following locations: backup encryption It is stored in the cloud and can only be decrypted by hardware.
- If you lose your hardware, Blocks can co-sign transactions that move funds to a new wallet After a waiting period, a notification will be sent to the user.
- If you lose both devices, you can rely on a pre-designated recovery contact, someone you trust who has the decryption key but cannot access your funds.
Finally, Block recognizes that none of these mechanisms is as simple as writing down 12 words, and their effectiveness depends on users getting them right the first time.
