Towards New Self-Custody Best Practices

The discussion regarding the implementation of multisig configurations and manual seed generation in cryptographic devices highlights several key points about enhancing security and user autonomy in managing cryptographic keys. Manual seed generation offers a secure alternative to reliance on pre-configured seeds from manufacturers by eliminating the dependency on potentially compromised software and hardware. Various methods for generating these seeds include using physical objects such as coins, dice, cards, or paper slips with seed words. These methods ensure that the generation process remains fully offline, thus significantly reducing the risk of exposure to malicious actors.

However, a critical aspect of manual seed generation involves the accurate calculation of checksums to validate the integrity of the seed. Tools like Seedsigner are crucial in this context as they help users compute the correct last word of the seed sequence, which acts as a checksum. This function is vital because it confirms that the seed phrase has been generated correctly without errors that could compromise wallet security. Furthermore, there is a suggestion for hardware devices to integrate functionalities that not only check but also correct checksums if necessary. This feature would allow devices to prompt users about an incorrect checksum and provide options either to discard the seed phrase or correct it under user acknowledgment of the risks involved.

The proposed enhancement for hardware wallets includes functionalities whereby upon entering a BIP39 seed phrase, the device should verify its checksum. If discrepancies are found, the device should inform the user and offer corrective actions while detailing the potential risks associated with manual seed generation errors. This approach ensures that users maintain control over their cryptographic keys while being supported by robust tools that safeguard against human error in manual seed creation processes. Such advancements could have significant positive impacts on the security standards within the industry, encouraging broader adoption of practices that bolster user trust and device reliability.