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Paper 2021/715

Hours of Horus: Keyless Cryptocurrency Wallets

Dionysis Zindros

Abstract

We put forth a keyless wallet, a cryptocurrency wallet in which money can be spent using a password alone, and no private keys are required. It requires a smart contract blockchain. We propose two schemes. In the first, the user sets a short wallet password and can spend their money at a prespecified maturity date using the password alone. Using this as a stepping stone, we propose a second scheme, in which the user uses an OTP authenticator seed to generate a long series of time-based OTP passwords for the foreseeable future. These are encrypted and organized in a Merkle tree whose root is stored in a smart contract. The user can spend funds at any time by simply visually providing the current OTP password from an air gapped device. These OTPs can be relatively short: Just $6$ alphanumeric characters suffice. Our OTP scheme can work in proof-of-stake as well as static and variable difficulty proof-of-work blockchains. The low-entropy in the passwords and OTPs in our scheme is protected from brute force attempts by requiring that an adversary accompany any brute force attempt by a transaction on the chain. This quickly incurs enormous economic costs for the adversary. Thus, we develop the first decentralized rate limiting scheme. We use Witness Encryption (WE) to construct a timelock encryption scheme in which passwords are encrypted from past into future blocks by leveraging the NP-language expressing proof-of-work or proof-of-stake performed as the witness. Witness Encryption is a currently impractical cryptographic primitive, but our scheme may become practical as these primitives are further developed.

Metadata
Available format(s)
PDF
Category
Applications
Publication info
Preprint. MINOR revision.
Keywords
cryptographic protocolsblockchainwallets
Contact author(s)
dionyziz @ gmail com
History
2022-02-10: last of 2 revisions
2021-05-31: received
See all versions
Short URL
https://ia.cr/2021/715
License
Creative Commons Attribution
CC BY
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