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Cryptnox BG1 Card

🔍 Last analysed 29th April 2022 . Bad Interface

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The Analysis 

Background

Cryptnox has partnered with the HTEC group to offer multiple products:

  1. Cryptnox FIDO2 - FIDO2 Certified Level 1 Smartcard

  2. Cryptnox BG-1 Card Dual Seed Generation
    • Two cards paired with a Mutual Authentication Security for Dual Generation
  3. Cryptnox BG-1 Card
    • Crypto hardware wallet smartcard with advanced functionalities
  4. Cryptnox B-NFT-1 Card
    • Specific card version with potential application to non-fungible token (NFT)

Product Description

NFC and Contact Optional Fido2 Enabled Functionality (Choose Option)

Genuine check with On-Card Dynamic Active Authentication with Manufacturer Certificate Chain

Backup Solutions:

  • CloudHSM based (FIPS 140-2) Key Mangement Service and Secret Manager from Amazon Web Services Standard 12/24 Words (BIP 39)
  • BIP32 & SLIP10 Key Derivation fully On-Card (no Parity Recovery needed) and Digital Signature

Export BIP32 XPUB Data

Digital Signatures : ECDSA “Koblitz Bitcoin” K1 and NIST P1 256 bits curves

Data Exchanges always fully protected within AES 256 bits Secure Tunnel, with MAC for integrity and authentication

Seed Generation from On-Card TRNG source

Card Authentication with:

  • Windows Hello Biometrics (TPM)
  • IOS with Biometrics (Secure Enclave)
  • Yubikey Products with Personal Identity Verification Functionality ((NIST 800-73-4))
  • Pin
  • File Encryption and Decryption (Encryption Key derived from Seed)

On-Card Transaction History and Counter Log

On-Card Blockchain Configuration Settings

Common Criteria EAL6+ Certified Chipset

Python3 CLI client for:

  • Windows
  • MacOS
  • Linux Ubuntu (including Ubuntu Core 20)
  • IOS Application: https://apps.apple.com/app/id1583011693

Documentation

Documentation has been provided by the project

Software

How it works

Cryptnox gave this brief on how the device works:

Our Client Cryptnox wanted to make this entire process even safer by allowing the user to use a hardware wallet without having to work with the mnemonic phrase. They came up with an idea to offer users two separate cards, hardware wallets, which can generate the same private key inside of them without ever exposing it to the outside world.

This would allow users to use one card when they are making transactions and if that card gets stolen, or lost, they will have the backup, the other card which they have previously placed in a safe or some other secure place. As the cards are identical, the user can transfer the assets to another account from the backup card. Cryptnox needed somebody to help them implement their ideas in an innovative way — they approached HTEC Group to help them develop applications with a user-friendly interface that could perform a variety of advanced functionalities and turn their idea into a reality.

Solution We developed a complete iOS companion application that allows users to do transactions on Blockchain networks. The solution supports Bitcoin and Ethereum, and the user can, in CLI, use more granular commands, including working with smart contracts and the EOS network. At its core, it is a modern crypto wallet that uses our client’s cards for transaction signing.

Analysis

The device noticeably has no display or means for the user to interact directly with the card. As mentioned above, the device needs the companion app:

“We developed a complete iOS companion application that allows users to do transactions on Blockchain networks”

Without a display, the user would not be able to approve transactions physically using the card. Transactions may be signed blindly.

(dg)

Verdict Explained

The design of the device does not allow to verify what is being signed!

As part of our Methodology, we ask:

Can the user verify and approve transactions on the device?

If the answer is "no", we mark it as "Bad Interface".

These are devices that might generate secure private key material, outside the reach of the provider but that do not have the means to let the user verify transactions on the device itself. This verdict includes screen-less smart cards or USB-dongles.

The wallet lacks either an output device such as a screen, an input device such as touch or physical buttons or both. In consequence, crucial elements of approving transactions is being delegated to other hardware such as a general purpose PC or phone which defeats the purpose of a hardware wallet.

Another consquence of a missing screen is that the user is faced with the dilemma of either not making a backup or having to pass the backup through an insecure device for display or storage.

The software of the device might be perfect but this device cannot be recommended due to this fundamental flaw.

The product cannot be independently verified. If the provider puts your funds at risk on purpose or by accident, you will probably not know about the issue before people start losing money. If the provider is more criminally inclined he might have collected all the backups of all the wallets, ready to be emptied at the press of a button. The product might have a formidable track record but out of distress or change in management turns out to be evil from some point on, with nobody outside ever knowing before it is too late.