Can I use my phone as a hardware wallet?

Hi frens,

We all have smartphones, secure and reliable. Why do we need a dedicated device, say Ledger or Trezor, for storing crypto?

How it stores private keys

Let’s focus on how it safeguards your crypto wallet, aka how it “stores” the private key (or mnemonic).

“Cold wallet” operates within “offline” environment. That’s why you’d see people turning an old phone into a cold wallet.

“Hardware wallet” uses dedicated hardware to store the key, usually in a secure chip. Similar to your bank card. We’re focusing on this.

Is there a secure chip in your phone? Definitely. On iPhone, everything stored in Keychain is protected by the Secure Enclave. Even with the iCloud Keychain syncing mechanism, every item is protected by another key on iCloud hardware security module (HSM).

Is the private key visible?

Most mobile apps of crypto wallets store private key in the Keychain. That sounds a lot better than browser extensions, right?

Some people have been complaining that “keeping mnemonic” is troublesome, especially fundamentalists always ask people to write it down on paper, or even on a metal plate!

So developers have been building crypto wallets that don’t require a mnemonic, ex. smart contract wallet, multi-party computation (MPC) wallet, etc.

Here’s the latest product as a great example: JoyID Wallet, which takes advantage of passkey. On iPhone, it’s safely stored in the Keychain and safely synced with iCloud Keychain. All you need is Face ID. Sounds promising, right?

But it’s relatively troublesome to manage passkeys on the iPhone. You can’t view or export the passkey. Probably for your “security”.

All passkeys are used for a specific website domain. If the website were shut down, everything would be gone. That’s because passkeys are designed for the authentication of existing web services, not for the ultimate trust of owning crypto assets.

Final words

Mnemonic is truly a single point of failure if leaked, but also the most powerful trust that you indeed own those crypto assets. Store mnemonic wherever you’d like, based on how valuable the crypto assets are inside it. Just like how you stored your real-world assets.

Choose your crypto wallet wisely. Trustless means being an informed user, not just a passive consumer.

Your friend,

Denken