Hardware wallets in case of sudden death: are you prepared?
1266 sats \ 16 comments \ @south_korea_ln 31 May bitcoin
What are your backup strategies in case you suddenly die in a car crash, for instance?
Say you own a Ledger/Trezor/Coldcard... you have the hardware wallet and the 20 words or so as a backup.
In case you die:
  • a trusted friend/partner/etc knows the location of your hardware wallet and the password: you're good, he can recover it
  • a trusted friend/partner/etc knows the 20 words, you're good, he can recover it
What if your friend or partner dies at the same time as you? This could happen more often than not, say a car accident with your partner.
Now, let's go to more "user-friendly" hardware wallets like Bitkey.
The setup the way I understand it makes it quite easy to recover in case you lose your phone, or your hardware wallet, but you don't have the 20 words and the way to interact with the hardware is with a fingerprint.
However, if you die, it suddenly becomes much more complicated. The only way to access your hardware wallet is with your fingerprint. You've been incinerated, that's gone.
What now?
Seems like the trusted contact still needs to have access to your phone (including password) and their phone to initiate the recovery process without your input. And even then, they would also need to have access to your google account to initiate the next step of the recovery process to get access to the hardware key.
Or am I missing something?
In any event, seems like death is the weak spot in all of these hardware wallets...
What are your best practices?
Are you prepared for this eventuality?
I am prepared. My BTC won't be lost.50.0%
I am not prepared. My BTC will be lost.50.0%
4 votes \ poll ended
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424 sats \ 1 reply \ @DarthCoin 31 May
Why people are obessed with leaving their sats to somebody else in case they die? This is not fiat. This is bitcoin, damn it. If the family wasn't clever enough to take my btc while I am alive, that means they do not deserve it.
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0 sats \ 0 replies \ @megaptera 31 May
You would not care when you die today and your children (say 4 & 6 year old) will have no access to your coins.
Of course, your dead and cannot care anymore.
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1010 sats \ 9 replies \ @megaptera 31 May
I think you should think seedphrases not hardware wallet.
You could give half of your recovery words to one trusted party and the other half to another and then tell a third trusted party who has the keys. Of course there is the case that all three can rug you. You can add one party more by using a passphrase.
As an additional safety you can also setup a dead mens switch: #326762
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0 sats \ 8 replies \ @south_korea_ln OP 31 May
Yeah... to be fair, what prompted this is my looking into the Bitkey wallet. Because you don't have the seedphrases, you cannot set up a new wallet outside of the Bitkey environment. Forgetting about the lack of screen on the wallet (weak point of their design), I kinda like the fact that they make it easier to recover things (in case you are still alive, that is) as to me the weakest point in the traditional hardware setting is the fact that human nature will make it so that at some point I will lose the recovery words or my trusted parties will.
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0 sats \ 7 replies \ @megaptera 31 May
Bitkey does not have seedphrases?
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0 sats \ 6 replies \ @south_korea_ln OP 31 May
Not that I know of.
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0 sats \ 5 replies \ @megaptera 31 May
yeah I see.
Bitkey is a 2-of-3 multi-signature wallet. That means there are three private keys protecting your money. One's on your phone, one in your hardware device, and one held for you on the Bitkey server.
You always need two out of three keys to sign a transaction, giving you extra protection. And because Bitkey only holds one key for you, and you hold two, Bitkey can’t move your money without you.
What happens if Bitkey disappears? Of course you can sign with your phone and hardware wallet but if you loose those as well your screwed. Should be possible to do a proper backup without relaying on Bitkey, a phone or the bitkey hardware wallet. Maybe you can, I don't know.
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0 sats \ 4 replies \ @megaptera 31 May
btw: Be aware that they know your xpub and thus all your transactions:
Transaction Data (i.e. details of the transfer of bitcoin) Purpose: Bitkey maintains one of your three keys in order to provide recovery tools if you lose access to your wallet, and to co-sign mobile transactions if you choose to use this feature. Because we maintain this key, we’re able to identify transaction data on the blockchain related to your Bitkey. This information may be used for troubleshooting and to improve our Services. How: This information is collected from you when you transfer bitcoin to or from your Bitkey.
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0 sats \ 3 replies \ @south_korea_ln OP 31 May
Yeah, I am well aware of the limitations.
It's just that interacting with the non-technical people that I need to rely on in case I am not there, I realize that user-friendliness takes precedence over hardcore Bitcoin principles...
So I would potentially be open to compromise on this lack of privacy if required...
The weakest link in any setting remains the imperfection of humans.
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10 sats \ 1 reply \ @south_korea_ln OP 31 May
Thanks for your comments, very useful, in any event. Have some sats.
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0 sats \ 0 replies \ @megaptera 31 May
If you have a trusted bitcoiner you could point your non-technical people who have access to your funds to connect to the trusted bitcoiner who can help them setup everything securely if you pass away.
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555 sats \ 2 replies \ @BTCExecutor 31 May
Best practice: hold your BTC in some type of multi-factor wallet
Larger stack: consider a collaborative custody multisig with casa, unchained, nunchuk, liana, etc. All have pros and cons, but all greatly reduce risk of total loss upon death. Don't try DIY multsig, most ppl with mess it up
Smaller stack: poor man's multisig (singlesig + passphrase). Share seed phrase with heirs, passphrase with executor (someone not an heir). Again, pros and cons, but pretty simple so reduces risk of catestrophic loss.
Don't rely on treasure maps, letters of instruction, those fail WAY more often than you think.
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0 sats \ 1 reply \ @Signal312 1 Jun
Passphrase ONLY with the executor, no backup? It seems like a single point of failure.
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0 sats \ 0 replies \ @BTCExecutor 2 Jun
With the executor, and all successor (backup) executors
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0 sats \ 0 replies \ @south_korea_ln OP 31 May
From Bitkeys customer service, asked about this in case I'd decided to go with Bitkey.
You don't have a seed phrase. We're actively working on an inheritance feature but in the meantime, you'll soon be able to enable multiple fingerprints on you Bitkey hardware which can allow a family member to access the funds if the owner unexpectedly dies.
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