April 2, 2015
Bitcoin still has yet to gain mainstream adoption in the payments industry. A factor that may be slowing down Bitcoin’s mainstream adoption could be the skepticism around security, as cases do exist where there have been losses due to cybersecurity issues. An ideal way to make Bitcoin reachable to more consumers would be through mobile wallets, since they should ensure the highest level of security to gain consumers’ confidence. Bitcoin players are aware of this synergy and some companies have already come up secure bitcoin mobile wallet solutions. Here are some prominent ones:
Aegis is an open source bitcoin wallet for Android that was created by the founder of the Bitcoin Security Project. The mobile wallet not only supports multiple currencies, but allows users to track their transactions on the bitcoin blockchain. The digital currency wallet has been developed by leveraging the highest standards in cryptography and information security, utilizing security algorithms and secure protocols. Users can encrypt their wallet either using a password or an NFC tag. Aegis wallet is available on the Android Wear platform as well.
BitGo’s multi-signature architecture delivers a significant level of security. However, BitGo has also developed a comprehensive insurance solution that offers BitGo and their customers another layer of protection. BitGo has secured first-of-its-kind insurance coverage for bitcoin theft from the XL Group of insurance companies. The policy issued to BitGo is the first comprehensive coverage issued by a major, global, A-rated underwriter to a bitcoin company. All of BitGo’s paying customers are eligible for protection under the XL policy for up to $250,000 in covered theft claims, just by signing up for BitGo services. BitGo customers can increase the amount of protection available to them for a 1 percent annual fee.
The bitcoin wallet works in sync with hardware that brings with it a high level of security. BitStash offers three tiers of secure storage for the user. Besides the mobile wallet, the bluetooth connected hardware acts as device wallet, and the third component involves a true cold storage wallet on a LUKS encrypted USB drive for offline storage. The mobile wallet effectively fights against mobile malware through global 2 factor authentication and Color Captcha solutions.
This Bitcoin mobile wallet comes from the popular bitcoin processor, BitPay. Copay’s transaction process requires multi-signature authentication, a system which was originally created for use at BitPay. Correct implementations of bitcoin multi-signature technology require multiple signatures on a bitcoin transaction. Bitcoin miners will reject a multi-signature transaction if it does not have the required number of signatures. Each party can independently sign a transaction on a different physical device without the private keys ever needing to be co-resident on any single device. Those private keys don’t even need to be under the control of a single person.
A high level security Bitcoin wallet for Android smartphones, the mobile wallet enables users to send and receive secure transactions. Regarding the security and privacy aspects, all stored and exchanged data is encrypted. EasBit offers secured backup facilities via its cold storage functionality. The main principle involved here is decentralization. EasBit does not store any Bitcoin related data on its server. Rather, the Bitcoins are stored locally on the user’s end in an encrypted format. This ensures that the user is always in charge of the virtual currency stored.
HyprKey utilizes its self-developed HYPR-3 three-factor authentication protocol to protect digital currency users from fraud. This involves creating a biometric authentication bridge between the user and the mobile wallet. The bridge auto-converts bitcoin in real-time, extracting payment information through a linked debit card. The security add-on to the bitcoin mobile wallet involves a HYPR-3 token. This token is basically a sticker which can be attached to your phone synced via bluetooth and includes a fingerprint scanner. The biometric TOTP (time-based one-time password algorithm) token generator provides the real security cover required.
Wiper was originally a social messaging app, but has now incorporated bitcoin wallet right into the app. Wiper is known for letting users delete entire records of conversations, something similar to SnapChat. The fully featured bitcoin wallet uses its own unique security feature and does not employ two factor authentication or multisignature support. Wiper anonymizes the bitcoin transactions and the anonymity disappears when the transaction info is submitted to the blockchain. This basically means that the records of a transaction will disappear from the recipient’s and receiver’s phones and from the Wiper server as well. The only record left will be on the blockchain.
Xapo tries to bring the combined power of a bitcoin vault and a bitcoin wallet together, the vault being the the required security aspect. The vault actually employs cold storage methodologies where users’ bitcoins are segmented and stored offline in a number of cold storage vaults. The vault works in sync with the mobile wallet which can be used to initiate the transactions. The vault implements advanced encryption based on a highly secure procedure to move the bitcoins offline in a cold storage process.