Update: CoinSafe has been shut down!
- We beta tested Coinsafe Crypto wallet’s recovery method.
- A key feature to recover a lost wallet involves an approval from 2/3 or 3/5 ‘trusted devices’.
- Developed by Arnav Vohra and Tarun Gupta with a tag line “Never Lose Your Bitcoins”
- Coinsafe allows setting up a recovery of the wallet in app itself.
Back in 2017-2018 I watched a bunch of videos on a youtube channel called Inchained. The creator Arnav Vohra interviewed some of the most influential people in the Crypto space, published tutorials and explanatory videos and some casual conversations as well.
So when he told me they had created a Bitcoin wallet which has a different kind of security than what is available in the market, I was intrigued. Due to lack of time, it took several weeks of back and forth on the app, understanding the full vision and until I finally was able to secure four phones to test it out.
Since a bunch of additional features like an exchange are yet “under development”, I decided to test out the only important thing – Recovery of a lost wallet.
What is CoinSafe?
We will try to break down the process into more layperson terms than the technical work flow that Coinsafe described aptly on their medium post.
In essence, Coinsafe is a cryptocurrency mobile wallet supporting several crypto assets such as Bitcoin, Ethereum, Monero and so on. The problem with mobile wallets is that there is just one or two ways of recovering a lost wallet – Enter the 12/15/24 word seed phrase.
In comes CoinSafe. With email verification and a very distinctive recovery process involved 2-3 other phones of people you trust which we will discuss further. Theoretically I am dumbing it out, because there are also other ways to back up the wallet like exporting the private key, but the one price of flock is the trusted devices based recovery.
Create it before losing it
You get two options on the home screen – Create and Recover. Let us choose create because the sub heading of this section is about creating a wallet.
The third option is for those who do not want to use the services of the wallet but just make their phones a trusted device for a friend or family’s wallet.
After choosing to create a wallet, enter a username of your choice, setup the pin, backup the seed phrase to create the wallet. Choose the crypto assets you want to create the wallets for.
Setting up the Recovery
The exchange on the app is currently under development. The wallet supports only Bitcoin and Ethereum at the moment and it is still in Beta. So my personal advise is to play with smaller amounts for now.
But since we are here to test the recovery. I am going to set it up. You will need to enter an email address and verify it with the code you receive on email.
The second step is to add the trusted devices. You can either add 3 or 5 devices. For recovery you will need either 2/3 or 3/5 devices to approve. All usernames of trusted devices are case sensitive. I setup three trusted devices – installed the app in three other phones and setup usernames.
Testing the Recovery
Alright, now is the moment of truth. On my phone I have logged out of the app. So I am back at the home page and choosing “Recover” this time.
Once chosen, coinsafe asks to enter email address for verification. A code is sent to the email address that must be entered in app to verify the account. You can also recover the wallet by entering the seed phrase.
Following email verification, I had to enter all three device names I set up for recovery. I did. And then there was a pending status against each device.
I picked up “Naimish2” device and opened Coinsafe. On the recovery tab, I saw the request for approval and clicked “Approve”. The same was updated on my phone.
I then approved the the request from the second phone “naimish3” and voila, my coinsafe wallet was recovered. You also get the option to recover and backup your seed phrase/mnemonic again.
How it Works?
It is not as simple as Arnav made it sound to me. Coinsafe uses a cryptography algorithm called Shamir’s secret sharing, developed by Adi Shamir. It is a form of secret sharing, where a secret is divided into parts, giving each participant its own unique part.
To recover the secret a minimum number of parts is required. In the threshold scheme this number is less than the total number of parts.
In case of Coinsafe, the algorithm divides the Seed phrase into parts across trusted devices. So if 2 out of 3 devices are able to approve the request, the mnemonic is regenerated and wallet is recovered. If the user chooses 5 trusted devices then a minimum of 3 of those devices must approve the recovery request.
Coinsafe plans to put the code on github and make it open source once the beta testing phase is over according to their website FAQ. The website also details the Secret Sharing algorithm break down.
I do find this concept really intriguing. Reminds me of old time movies where a safe’s lock would only open if 4 keys are used and each key is given to one of the members of the committee so no single person can steal the money. An email verification is an additional security step which I like. The encryption ensures that no one from coinsafe or otherwise can send recovery requests to trusted devices.
There are a lot of things still “coming soon” on the app so we have time until we can fully review the wallet services. Until then you can play around with the Wallet recovery and leave feedback to Coinsafe team.
What do you think of Coinsafe? Let me know in the comments below.