A little over a week ago, we wrote an article about hierarchical deterministic multisignature wallets, and how they would be the next evolutionary step for Bitcoin security. The Bither team, who created an alternative Bitcoin client, were working on this for the time being, and they would release the HDM wallet in the next week or so. That release has now taken place, so let’s take a closer look at what we can expect from Bither’s hierarchical deterministic multisignature wallet implementation.
Bither’s Hot and Cold Modes
In our previous Bither article, we made a mention of the Hot and Cold Wallet system implemented by the developers. To quickly recap, users can “split up” their funds, by sending a portion of ready-to-be-spent Bitcoins to the Hot Wallet, while keeping the rest in cold storage (the Cold Wallet). This is a very interesting take on the “be your own bank” principle many people associate with Bitcoin.
However, if you want to use Bither’s hierarchical deterministic multisignature feature with the Hot and Cold wallet, you will need to have two mobile devices in your possession. Your “spare” device will be running in offline mode and serve as your Bither Cold Wallet, keeping your funds safely and securely in cold storage.
In its current implementation, Bither’s hierarchical deterministic multisignature feature does not support using HDM on one and the same device. In saying that, the developers leave the door open to possibly making that feature available on one device in a future client release. But to be honest, most of us have an old phone in a drawer somewhere which can serve as a Cold Wallet for your bitcoins.
The Bither developers were kind enough to send up a detailed instruction procedure on how to set up your second phone as a Cold Wallet. Most of the steps speak for themselves, and the whole process is pretty straightforward,a s it won’t even take that long to complete. After trying it myself, I managed to get the whole thing set up in under 5 minutes.
Setting Up your Second Phone as Cold Storage
1. Install Bither on the cold phone. Open it and swipe to the right page of settings. Press ’Switch to Bither Cold’.
2. Press ‘+’ on the bottom left. Swipe to HDM tab. Press the ‘Generate’ button. You will be asked for a password to encrypt the private keys. And you can see Bither collects ambience entropy to generate an XRandom HDM cold seed.
3. Install Bither on the hot phone. Open it and press the ‘+’ button on the bottom left. Swipe to the HDM tab. You will see the three parts of an HDM account.
4. Press each part of HDM account to finish the generation process. Bither will tell you where to press and which QR Code you will need to scan. Press the little QR Code button on Bither Cold will give the options to show each of the QR Codes.
5. When all of the three parts are highlighted. A triangle will form and an HDM account is generated.
The process may be a little difficult, but since Bither needs the three different HD seeds on three different devices -which will never leave the device they are generated on – there is no reason to compromise on security for the benefit of convenience. After the initial setup, users can enjoy both the convenience of HD (Hierarchical Deterministic) and the safety of Multisig. All of the benefit comes with only the need to backup one HDM Cold seed.
Additional Addresses For Your HDM Setup
Completing the initial hierarchical deterministic multisignature setup process is one thing, but what if you want to add another Bitcoin address to your existing “infrastructure”? This can easily be done , as all it takes iso ne click on the “+” button of the HDM Hot header. Users can add up as many addresses as they need.
Sending money from your your newly created HDM address while using the Bitcoin Hot device is achieved easily. Click on the three little dots in the top right corner of the screen (when you are in sending view), and you will be presented with several options. Users will be signing a transaction with HDM server by default, but there is also the option to sign with HDM Hot if you so prefer.
In the unfortunate event of Bither’s HDM server going down for any reason, users can still sign transactions with their Cold Wallet device. The “sign with HDM Cold” feature has been added to the client with that specific purpose in mind. In fact, users don’t even need the HDM server to spend their own Bitcoins, but it’s a nice option to have while still getting used to the HDM feature.
Bither’s HDM Server
Most Bitcoin enthusiasts will opt not to rely on Bither’s HDM server in order to spend their bitcoins, which is understandable. However, there are some things about Bither’s HDM server that might put your mind at ease. First of all, server authentication occurs via BitID and HDM Cold.
The reasoning behind this decision is that, even if you were to lose your daily usage phone, or simply replace it without considering your Bither installation, no damage is done. Simply install Bither on the new device, go into “Advanced Options view” and press “HDM Account Recovery”. A few QR codes will need to be scanned in order to add a HDM Recovery Account to your device.Once this HDM Recovery Account has been created, you can use HDM Server and HDM Cold to transfer the bitcoins you have stored on these HDM addresses to a brand new address.
All in all, Bither’s hierarchical deterministic multisignature implementation is pretty straightforward to set up, and takes roughly 5-10 minutes to set up. You will need a second device though that can install the Bither mobile application.
Website : http://bither.net/
Google Play Store : https://play.google.com/store/apps/details?id=net.bither
Apple App Store : https://itunes.apple.com/us/app/bither/id899478936
Source Code : https://github.com/bither
Twitter : https://twitter.com/bithernet