BitBox02: Optional passphrase

Table of contents

  1. How it works
    1. Attention: Any passphrase is valid
    2. Benefits of using a passphrase
    3. Risks of using a passphrase
  2. Using a passhrase
    1. Enable optional passphrase in device settings
    2. Pro tip: hiding that you are using a passphrase

How it works

Simplified: When you set up a BitBox02, it generates a “long random number” which is converted into a mnemonic seed, which is stored on the device and on the microSD card backup.

Subsequently, whenever the BitBox02 is used, it derives a cryptocurrency wallet via a (very simplified) formula: mnemonic seed + passphrase

If you don’t use a passphrase that is: mnemonic seed + “” (empty string)

If you use a passphrase that passphrase is appended to the mnemonic seed and your wallet is derived from that.

As a result to how that process works, any passphrase is valid. Valid in the sense that you won’t get an error message but if the passphrase is not identical to the one you used when you set up your wallet, you will derive a different wallet.

Example:

mnemonic seed + passphrase1 -> Wallet1

mnemonic seed + passphrase2 -> Wallet2

mnemonic seed + passphrase3 -> Wallet3

Attention: Any passphrase is valid

Mistyping the passphrase will generate a completely new wallet. There is no such thing as an “incorrect passphrase”, so whatever you provide as your input will be used in the process of deriving a wallet.

If you enter an empty passphrase (no passphrase at all), your BitBox02 will proceed exactly as if the passphrase feature had not been activated at all, and generate a wallet from your recovery seed stored on the device.

In order to restore a wallet that used a passphrase you will need your backup (stored on microSD card) AND the passphrase you used for that wallet.

Benefits of using a passphrase

  1. Because the passphrase is not stored anywhere on the device, it helps to protect against any attacks involving physical access to the device. Furthermore, if somebody compromised your physical copy of the recovery seed, they still would not be able to access your passphrase protected wallet unless they knew the passphrase.
  2. You can create as many passphrase-protected wallets as you like. This gives you a secondary advantage: hidden wallets = plausible deniability.

    Example: You might want to leave some pocket money in the basic “non-passphrase” wallet, then move a portion of your funds to one passphrase; and lastly, the most significant portion of your funds to another passphrase-protected wallet. The idea behind this is that if you ever find yourself in a situation where somebody is trying to extort a ransom from you or puts you under duress, you can safely give up the PIN.

Risks of using a passphrase

  1. Because the passphrase is not stored anywhere automatically, you need to take all necessary precautions in order to make sure that the passphrase stays safe and accessible e.g. by making a physical backup.
  2. If the passphrase is lost, it can only be found by guessing (brute-forcing) which is often technologically and economically infeasible (read impossible). The difficulty of guessing the passphrase varies depending on the strength (complexity) of the passphrase.

Using a passhrase

Enable optional passphrase in device settings

Go to “Device settings” and click “Enable optional passphrase”. alt text

You will then see the following warning alt text

Please make sure you understand how a passphrase works. If that is the case, confirm on your BitBox02 that you want to enable it.

Then you will see the following: alt text

From now on you will be asked for a passphrase after every device unlock.

  • If you want to use your “normal” wallet just confirm directly i.e. with no passphrase input / empty passphrase.

  • If you want to access a passphrase-protected wallet, type in the corresponding passphrase and then confirm.

Pro tip: hiding that you are using a passphrase

If you don’t want to be asked for your passphrase every time you unlock your BitBox02 you can click “Disable optional passphrase” at any time in the device settings. As no data about your passphrase is stored on the device (you need to backup your passphrase independently) nothing is deleted. If you want to use the passphrase-protected wallet again you can just “Enable optional passphrase” again and then use the same passphrase again to access that wallet.