Thursday, September 15, 2016

Bitcoin Hardware Wallet Review: Ledger May Have Caught Up to Trezor With Nano S

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Since hardware wallet devices first came to pass in the Bitcoin ecosystem, the Trezor has been the one wallet to rule them all. Added security measures, such as the ability to visually confirm the correct receiving address on the device’s display, were always the key selling point of the Trezor, but Ledger may have now caught up to its rival with the Nano S.


While the Nano S does include a screen for verifying the receiving address before sending a transaction, that’s only part of the reason why it is a compelling alternative to the Trezor. The Nano S also has a lower price point ($ 65 compared to the $ 99 Trezor), and Ledger’s open SDK may lead to the development of a large number of new, dynamic applications for the hardware wallet.


While there are plenty of people who have no reason to switch to the Nano S from the Trezor, bitcoin holders purchasing new hardware wallets may find it hard to pass up the latest offering from Ledger.


The Use of a Secure Element


The level of security provided by the original Ledger Nano was viewed as inferior when compared with the Trezor, but the Nano S appears to have completely flipped the script. The Secure Element included in the Nano S has some members of the Bitcoin community, such as Bitcoin Core contributor Btcdrak and Opendime founder Rodolfo Novak, claiming the Nano S is a more attractive option than the Trezor.


“Application isolation and runtime security,” responded Ledger CTO Nicolas Bacca when asked about the advantages of the Secure Element in the Nano S. “Our design is based on a microkernel on top of which applications run. Applications are isolated from each other and from the kernel, which means that, for example, a bug in the Ethereum app cannot compromise Bitcoin-derived keys.”


According to Bacca, the Secure Element also protects against interdiction attacks (when packages are intercepted en route by third parties like the NSA). “This allows end users to be sure that they are interacting with a genuine device,” he said. “It is pretty much impossible to do that with a generic [microcontroller] unless you build the device yourself.”


In the past, Yubikey manufacturer Yubico has shared similar criticisms of the use of standard microcontrollers in secure hardware devices.


According to Bacca, a Secure Element can also protect against situations where an attacker has physical control over a hardware wallet with some bitcoin on it. Whether a nefarious actor listens to the behavior of the chip in an attempt to deduce information or physically targets specific aspects of the chip to derail running code, a Secure Element has added protections to limit the effectiveness of an attack.


“In a complex active attack — where an attacker tries, for example, to dump the memory by extracting it from the chip — a Secure Element protects against those by encrypting everything in place (flash, RAM, memory buses) and features a…


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Bitcoin Hardware Wallet Review: Ledger May Have Caught Up to Trezor With Nano S

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