SECURITY

US man stopped by police, wallet revealed mnemonic phrase recorded and exposed by authorities

share
US man stopped by police, wallet revealed mnemonic phrase recorded and exposed by authorities

This incident has raised concerns in the crypto community about how to securely store mnemonic phrases. Besides storing mnemonic phrases offline on paper, what other methods can be used to enhance security effectively?

Jameson Lopp, a Bitcoin ecosystem developer and co-founder of self-custody solution Casa, shared a video on Twitter.

In Nevada, a man was stopped by the police, handcuffed, and confined to the back seat of a car. During a search of his bag, the police unexpectedly found a paper containing mnemonic phrases. The police officers who unfolded the paper were not clear about its function, and this scene was recorded by a camera for some time.

Advertisement - Continue scrolling for more

As the mnemonic phrases were exposed in front of the camera, the police officer even muttered several words from the phrases while answering a call. The mnemonic phrases continued to be exposed in front of the camera until the armed personnel beside him finally pointed out:

Uh... this paper is... this is that crypto shit, Crypto... mnemonic phrases.

Although the video shows that the incident occurred as early as April this year, it is still sparking widespread discussions.

Click here for the full video

Jameson Lopp wants to emphasize the potential risks of transcribing mnemonic phrases on paper, although he may also be promoting the solution to private key custody issues offered by his own company.

CZ: Different Custody Methods Come with Different Risks

Binance founder Zhao Changpeng, CZ, took notice of this news and retweeted the video, stating that he supports holding cryptocurrencies in any way, but one must be aware of the corresponding risks.

Some suggest memorizing all the mnemonic phrases directly, but CZ believes that this does not solve the inheritance issue.

Independent security researcher CIA Officer released several articles on security issues related to this incident, providing security advice to the crypto community, which includes:

1. Do Not Copy Mnemonic Phrases, Copy Private Keys Instead

He mentioned that private keys grant access to a single address, while mnemonic phrases can provide access to the entire wallet, covering multiple addresses and private keys.

2. Use Steganography Techniques

Hide information within texts, images, audio, video, or spam files.

3. Beware of Physical Theft and Attacks

The article documents known cases of crypto ATM, OTC, and industry-related robberies over the years.

4. Mobile Security Guidelines

Covering 25 internet security guidelines.