Bitcoin Offline Wallets Are Vulnerable To Attacks

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Security researcher from Humboldt University's Institute found that the BitCoin wallets in the cold storage could leak its private keys to an attacker. The vulnerability allows an attacker to reverse-engineer a compromised wallet's private keys from as little information as a single transaction issued by that wallet.

Stephan Verbücheln, the researcher who found this vulnerability said in his research paper that the cold-storage wallets are vulnerable to hacking attacks even if they were maintained on an air-gapped machine without an internet connection or even in space.

“The attacker only has to watch the blockchain until two compromised signatures appear ... the affected signatures are not detectable by anyone other than the attacker.”

Verbücheln's research paper titled - How Perfect Offline Wallets Can Still Leak Bitcoin Private Keys, explains the attack on  ECDSA or the Elliptic Curve Digital Signature Algorithm which is used in the bitcoin protocol to ensure funds can be only be spent by their rightful owners.

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