Announcing Penlock v1: Paper-Based Secret Splitting for BIP39 Seed Phrases

Penlock is a novel tool designed to facilitate the mechanical splitting of a 12-word seed phrase into a 2-of-3 backup format. This innovative paper calculator is an open-source creation that employs robust cryptography methods, ensuring simplicity and reliability throughout its operation. It offers users the ability to complete the entire process of learning, printing, assembling, executing, and storing shares in under two hours, provided they have access to a printer, scissors, a craft knife, and a pin.

Penlock's latest version introduces several improvements aimed at enhancing user experience and operational efficiency. One of the key upgrades is the optimization for producing 2-of-3 backups using a paper-optimized splitting algorithm. This focus on 2-of-3 backups represents a shift from the previous versions that supported K-of-M splitting with Shamir Secret Sharing, which was more complex and less streamlined. The developers believe this optimization will cover nearly all use cases effectively.

Furthermore, Penlock introduces a generic backup strategy template intended to aid users in setting up offsite recovery and trust-minimized inheritance solutions. This strategy involves assigning each share to a different storage category: Digital, Social, and optionally Legal. This diversified approach to share distribution makes it significantly challenging for potential attackers to compromise the system, as they would need to execute multiple types of attacks to gain unauthorized access.

Another notable enhancement in Penlock v1 is the introduction of an on-paper error correction algorithm. This innovation allows for the unambiguous correction of single errors per BIP39 word and the detection of up to two errors, with the possibility of correcting double errors given some patience. This feature is particularly groundbreaking as it is purported to be the first of its kind implemented on paper.

Penlock also simplifies the process of generating BIP39 seed phrases, making it one of the easiest methods available for manual generation. This improvement, along with others, stems from a two-year journey of refining the concept inspired by Codex32 from Andrew Poelstra and Russell O'Connor, with a focus on improving user experience without compromising security. The iterative design process ultimately resulted in significant changes that necessitated breaking compatibility with earlier versions, leading to the decision to wait until a stable and final design was achieved before announcing the public release.

The feedback on Penlock has been overwhelmingly positive, indicating a strong interest in secure, user-friendly tools for managing digital assets. For more information and to explore Penlock's features, visit https://v1.penlock.io/en/. This release not only showcases a significant advancement in cryptographic tools but also presents an intriguing challenge to the community, inviting users to reverse-engineer Penlock's secret splitting algorithm by examining its wheel—a testament to the tool's intricate design and cryptographic puzzle.