Air Gapping: Everything to Know
By Beluga Research August 22, 2023
- Cryptocurrency air gapping is the practice of isolating digital wallets or devices from internet connectivity to enhance security and protect against hacking
- It is the practice of physically disconnecting computers or networks from external connections, and has been used for decades to protect classified information
- In the realm of cryptocurrencies air gapping is employed to secure offline wallets, enable cold storage, facilitate transaction signing and ensure secure key generation
- It can be inconvenient, limit functionality, introduce the potential for human error and pose physical security risks
Cryptocurrency air gapping is the practice of isolating digital wallets or devices from internet connectivity to enhance security and protect against hacking. As cryptocurrencies gained popularity and value, security became a paramount concern. One of the fundamental security risks in the crypto world is the potential compromise of private keys, which grant access to digital assets. Air gapping emerged as a powerful defense mechanism to mitigate this risk. By physically isolating sensitive systems from the internet, air gapping creates an additional layer of protection against cyber threats.
A Brief History
The concept of air gapping predates cryptocurrencies and has been employed in various industries for decades. Initially, it was primarily used in military and government sectors to safeguard classified information. Air gapping involved physically disconnecting computers or networks from any external connections, ensuring that sensitive data remained inaccessible to unauthorized individuals.
With the advent of cryptocurrencies, air gapping found a new application in the realm of digital asset security. Cryptocurrencies rely on cryptographic keys to secure transactions and provide ownership of funds. These keys, particularly the private keys, need to be stored securely to prevent theft or unauthorized use. Air gapping became a popular technique to protect private keys from online threats such as malware, phishing attacks and hacking attempts.
Air Gapping: Everything to Know
Air gapping involves creating a physical barrier between a device or network and the internet or other potentially vulnerable networks. This isolation ensures that sensitive information remains inaccessible to online threats. Here are the key aspects of air gapping in more detail:
- Offline Wallets: Air gapping is commonly used to secure offline wallets, which are wallets that store private keys on devices disconnected from the internet. By keeping private keys offline, the risk of unauthorized access or theft is significantly reduced. Offline wallets can take the form of hardware wallets or paper wallets, both of which provide a high level of security through air gapping.
- Cold Storage: This refers to the practice of storing cryptocurrencies in devices or systems that are not connected to the internet. By employing air gapping, cold storage solutions ensure that private keys are kept offline, minimizing the risk of cyber attacks. Cold storage can be implemented through hardware wallets, paper wallet or dedicated offline computers.
- Transaction Signing: Air gapping is crucial when signing cryptocurrency transactions, particularly those involving significant amounts of funds. By utilizing an air-gapped device, the private key used for signing remains isolated from potential online threats, providing an added layer of security. This practice is often employed in multi-signature wallets and high-security environments.
- Secure Key Generation: Air gapping is also essential during the generation of cryptographic keys. By performing key generation on an offline device, the risk of key compromise due to online vulnerabilities is mitigated. Air-gapped systems ensure that the keys are created in a secure environment, reducing the chances of key leakage or manipulation.
To understand how air gapping works in the context of cryptocurrencies, let's start with the basics. Cryptocurrencies rely on cryptographic keys, specifically public and private keys, to secure transactions and provide ownership of digital assets. The private key, in particular, is a critical piece of information that must be kept secure at all times.
When it comes to air gapping, the first step is to generate a private key on a device that is completely offline and never connected to the internet. This offline device is often referred to as a "cold wallet" or "hardware wallet." By generating the private key offline, it ensures that the key is not exposed to potential online threats or malware that could compromise its security.
Once the private key is generated offline, it needs to be securely stored. This is typically done by writing down the key on a piece of paper or engraving it on a metal plate. These physical copies are often referred to as "paper wallets" or "metal wallets." The advantage of using physical copies is that they are immune to online attacks, such as hacking or malware.
- Offline Transaction Signing. With air gapped wallets, transactions are prepared on an online device, but the actual signing of the transaction occurs on the offline device. This ensures that the private key used for signing never touches an online device, reducing the risk of key exposure.
- Protection against Malware. Air gapped wallets significantly mitigate the risk of malware compromising private keys. Since the offline device is not connected to the internet, it is not susceptible to malware attacks that could potentially steal or manipulate private keys.
- Physical Security. Air gapped wallets rely on physical copies of private keys, such as paper or metal wallets. These physical copies can be stored in secure locations, such as safes or safety deposit boxes, adding an extra layer of protection against theft or unauthorized access.
- Enhanced Privacy. By keeping private keys offline, air gapped wallets offer increased privacy. Online devices are prone to surveillance and data breaches, but with air gapping, the risk of private key exposure to prying eyes is significantly reduced.
- Enhanced Security. Air gapping provides an additional layer of security by creating a physical barrier between the sensitive data and potential online threats. Since the offline device is not connected to the internet, it significantly reduces the risk of remote attacks, such as hacking attempts or malware infections.
- Protection Against Online Vulnerabilities. By isolating the private keys or wallets from online networks, air gapping mitigates the risks associated with vulnerabilities in software or operating systems. This approach helps to prevent unauthorized access or exploitation of security loopholes that may exist in the online environment.
- Offline Storage. Air gapping allows for the offline storage of private keys or wallets, ensuring that they are not constantly exposed to potential online risks. This reduces the likelihood of unauthorized access or theft of sensitive information, as attackers would need physical access to the offline device to compromise the security.
- Resilience to Network Attacks. Air gapping provides protection against various network-based attacks, such as distributed denial-of-service (DDoS) attacks or man-in-the-middle attacks. Since the offline device remains disconnected from the network, it is not susceptible to these types of attacks, enhancing the overall security of the stored assets.
- Control Over Data Transfer. With air gapping, users have full control over when and how data is transferred between the offline and online devices. This control allows for a more deliberate and cautious approach, reducing the chances of accidental data leakage or unauthorized transfers.
- Inconvenience. Air gapping can introduce inconvenience, as it requires physical transfer of data between offline and online devices. This process may involve using removable media, such as USB drives, to transfer the necessary information, which can be time-consuming and cumbersome.
- Limited Functionality. Since the offline device is not connected to the internet, its functionality is restricted. Users cannot directly access online services, such as real-time market data or blockchain explorers, while the device is air gapped. This limitation may pose challenges for users who require frequent online interactions related to their cryptocurrency holdings.
- Potential for Human Error. Air gapping relies on manual processes for data transfer, which introduces the possibility of human error. Users must ensure that the data is transferred accurately and securely, without any mistakes or accidental exposure. Failure to follow proper procedures may result in the compromise of sensitive information.
- Physical Security Risks. While air gapping protects against remote attacks, it introduces physical security risks. The offline device and any physical media used for data transfer must be securely stored to prevent theft, loss, or damage. Adequate precautions, such as secure storage locations and backups, should be taken to mitigate these risks.
- Updates and Maintenance. Keeping the offline device up to date with software updates and security patches can be challenging with air gapping. Since the device is not connected to the internet, the user must find alternative methods to apply necessary updates, which may require additional technical expertise or resources.