S4 E7: Peter Todd on Hardware Wallets, Security & Proofmarshall

Intellectually speaking, Peter Todd has been a bitcoiner before Satoshi Nakamoto even emerged on the cypherpunk mailing list. As a cryptography and computer science enthusiast, he would try to solve the double-spending problem with Hal Finney and Adam Back when he was just fifteen. His work and credentials definitely qualify him as a cypherpunk, but it’s his relentless critical spirit and adversarial thinking that make him stand apart.

As a true iconoclast, Peter Todd is not afraid to ask the questions that defy canons and would definitely call out the emperor for his nakedness in spite of authoritarian pressures to recognize the existence of clothes.

For these reasons, Todd is the perfect critic of hardware wallets, and the right kind of person to explain how ideal security setups should function. Though he avoids giving specific advice, Peter Todd does promote the development of a critical thinking mechanism which adapts to threats and preemptively phases out possibly disastrous scenarios.

The inclusion of Todd in season 4 of the Bitcoin Takeover Podcast marks a significant shift in tone, as for the first time during the series the guest has absolutely no involvement in the hardware wallet or cold storage business. By having no skin in the game, he can be brutally honest.

Throughout this two-hour interview, the cypherpunk is candid and merciless when it comes to criticizing the lack of transparency that certain manufacturers show.

And when he doesn’t explain why hardware wallets are terrible and how cold storage is best maintained, Peter Todd also talks about his latest project: Proofmarshall. If you’re able to help build the project (also described during the podcast at 1:17:00) or would like to audit it, feel free to contribute on the public GitHub repository.

The episode is available on iTunes & Spotify.

If you’re not on iTunes or Spotify, use this YouTube video. No registration is required.

Time Stamps:

4:02 – Intro

5:24 – Hardware wallet physical security

6:10 – Buying hardware wallets on eBay?

7:04 – Toothbrush analogy

7:26 – Supply chain attacks

7:40 – Fake seed cards 

8:20 – Does Peter Todd use any hardware wallets?

9:10 – Hardware wallets as part of the Bitcoin lifestyle 

9:30 – Dealing with Bitcoin in the early days

10:40 – Peter Todd running Qubes and multiple virtual machines

11:29 – Advice for newbies

13:00 – The economics of hardware wallets

13:50 – Markets for Bitcoin transaction data 

15:00 – Are Electrum servers ran by Chainalysis?

16:30 – Chainalysis and Bitcoin exchanges

17:00 – Shapeshift’s KeepKey

18:31 – Does Peter Todd use a Coldcard?

20:22 – The issue of hardware wallet screens and checking addresses

21:55 – Packaging to discourage supply chain attacks

23:00 – Coldcard and PSBT

25:25 – Auditing trusted setups

26:10 – Which hardware wallet does Peter Todd recommend?

29:15 – Is the YubiKey better than a hardware wallet?

31:57 – Setting up a watch-only wallet for cold storage

32:58 – Is just using Bitcoin Core secure enough?

35:14 – The psychology of having a piece of hardware that makes you feel safe

36:36 – Ballet Crypto and trusted printing

37:45 – BitAddress dot org

39:00 – Generating randomness with a dice 

40:10 – Security is hard and complex

41:00 – Security theatre 

42:47 – Cryptography vs Applied Cryptography 

44:30 – How can Trezor and Ledger steal funds from hardware wallet owners?

46:41 – Liability for theft

49:40 – Can hardware wallet manufacturers steal $1 from each user?

51:00 – The perfect theft that hardware wallet manufacturers can coordinate

52:10 – Bluetooth on hardware wallets?

53:10 – RS 232 

55:20 – Faraday cages

57:20 – Practical advice for bitcoiners 

59:00 – Tiger rocks, locks, and lock pickers 

1:00:20 – Is multisig a good idea?

1:01:23 – Is memorizing your private key a good idea?

1:01:56 – Security from yourself

1:03:30 – Physical vs digital data security

1:05:20 – Does Peter Todd like weed?

1:06:16 – Bitcoin and drug sales

1:07:41 – Peter Todd’s prediction for Bitcoin’s success

1:09:50 – One day, Bitcoin will go to 0

1:10:00 – The US dollar will fail before Bitcoin

1:12:50 – David Gerard and stories that exist just because they have an audience

1:16:22 – Peter Todd’s Proofmarshall project 

1:17:10 – Practical applications of Open Timestamps and Proofmarshall

1:23:30 – Why Peter Todd thinks Bitcoin should have inflation

1:24:51 – Replace By Fee (RBF) according to Peter Todd’s initial design

1:27:00 – Why it’s profitable but disingenuous to sell tokens

1:28:00 – Ethereum’s marketing was a scam

1:30:20 – We can’t replicate Bitcoin

1:31:30 – Post-profitability Bitcoin mining

1:37:40 – Does Peter Todd think Bitcoin will be around in 40-50 years?

1:39:40 – Why is Peter Todd not Satoshi?

1:40:30 – Does Peter Todd have anti-Bitcoin ideas?

1:41:30 – Gold is inflationary

1:46:25 – Does Peter Todd like the HTC Exodus 1s full node phone?

1:48:30 – Android is messed up

1:48:15 – Are iPhones more secure?

1:50:00 – Is Tails OS really safe?

1:50:40 – Why it’s good to have dedicated devices

1:52:30 – The mobile operating system choices we have are terrible

1:54:00 – Tor on Blockstream Green iOS

1:55:10 – VPN, Tor, or both?

1:57:30 – Should we run Tor exit nodes?

1:58:30 – Closing notes

Special thanks to LXMI and Phemex for sponsoring this episode!


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Please keep in mind that this is just an ad for a sponsor of this show. It’s not meant to serve as financial advice, and you’re responsible to do your own research before buying anything and act according to your own decisions. Embrace your financial sovereignty with agency and precaution.

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Please keep in mind that this is just an ad for a sponsor of this show. It’s not meant to serve as financial advice, and you’re responsible to do your own research before buying anything and act according to your own decisions. Embrace your financial sovereignty with agency and precaution.”

Written by Vlad
I like Bitcoin and I'm doing this podcast. Message me on Twitter if you'd like to be a guest.