Brainwallet: The Ultimate in Mobile Money

[Eugen Leitl]

(this is actually easier than you think! it works, try it out)

http://www.forbes.com/sites/jonmatonis/2012/03/12/brainwallet-the-ultimate-in-mobile-money/

Brainwallet: The Ultimate in Mobile Money

For as much as I am fascinated by the societal and political implications of
bitcoin, I must admit that I am equally fascinated by the implications of
Brainwallet. Quite simply, a brainwallet, or thoughtcoin, refers to the
concept of storing bitcoin in onebs own mind by memorization of a special and
unpredictable phrase. No, you are not actually storing the bitcoin in your
mind but you are storing the access mechanism, or seed, to your stashbs
private key.

For example, the phrase must be sufficiently long (12 words or more) to
prevent a brute force guessing attack, such as bI went seeking freedom, but
all the worldbs islands were already taken.b It is further suggested not to
use a simple phrase or a phrase taken from existing literature because it is
more likely to be hacked by a computer that systematically attempts all
phrases, similar to a dictionary attack. You want a high level of word
entropy. Seemingly random modifications of the phrase would aid in
strengthening brainwallet, such as bI went seeking freeeedom, but all the
worldbs issslands were alreaDy taken.b These simple changes make the entire
phrase very difficult to predict.

Next, the phrase itself without the quotation marks is turned into a 256-bit
private key with a hashing or key derivation algorithm. Completing this
process turns my secret phrase into the 64-character hexadecimal key shown
below (this should be kept secret also):

8E66837DDD412A72007571BF05977C7005324B285B918AB0DBC9A2BA9B86F849

You are basically creating your own public Bitcoin address by personally
determining the private key and that single instance is sufficient for our
brainwallet. With larger deterministic wallets, multiple public/private key
pairs are generated using a broot keyb derived from a starting seed and a
bchaincodeb, thus allowing a continual creation of different key pairs based
on the same root node. So the final step in our process is to use this
hexadecimal key to compute a standard bitcoin address with a utility such as
one provided by Casascius or Electrum. Additionally, you can perform this
function on bitaddress, a JavaScript client-side bitcoin wallet generator,
and even run a stored version locally on an offline computer for security.
The testing-only site is Bitcoin Tools. I add the serious disclaimers that
hashing/address generation should not be performed online and, although
possible, the importation of private keys is not yet standard functionality
on most bitcoin clients. Given that, my hexadecimal key computes into the
following base58 Bitcoin address:

1BgciYijPjVWvnpChmBNwB3isZUFKCJSox

Now, you are ready to receive bitcoin from anywhere in the world and have the
peace of mind that the corresponding private key to unlock, access, and
transfer those bitcoin resides solely in your brain. If you forget the phrase
or if you die suddenly, the bitcoin is lost and unrecoverable just like if
you had burned cash. You can even memorize multiple phrases for multiple
accounts, like casual spending and nest egg savings. Why is this so profound?

For starters, it represents the ultimate in mobile money. You have complete
financial privacy and asset protection combined with the ability to have
those assets fully accessible from anywhere in the world provided there is
Internet connectivity or a telephone. You are also protected from theft or
confiscation unless a legal jurisdiction can force you to reveal your bitcoin
private key that isnbt even known to exist. Possible applications include
revealing the secret phrase to a loved one for inheritance reasons or even
splitting the phrase into segments with each family member possessing a
portion of the total phrase. Off-grid transactions are also possible by
simply conveying the phrase via voice or encrypted email. It would also be
possible to send bitcoin immediately to someone without an existing address
because one could easily be created based on a selected phrase.

It may be awhile before this practice is commonplace since most people do not
use bitcoin on a regular basis and most of those do not generate
deterministic keys holding $1 million. But, it sure beats lugging around 17
kilos of gold bullion.