qusal/salt/electrum

electrum

Electrum Bitcoin Wallet in Qubes OS.

Table of Contents

• Description
• Installation
• Usage
  • Connect your cold wallet to a trusted server
  • Connect your cold wallet to an untrusted server
  • Recommendations for cryptographic operations
  • Cold wallet terminology
• Credits

Description

Setup multiple lightweights Electrum Bitcoin Wallets, one offline qube named "electrum" and one online qube based on Whonix-Workstation named "electrum-hot".

You can use either wallet or both together depending on your setup. Use the "electrum" to sign transactions and the "electrum-hot" to broadcast them.

By default, the installation verify and fetch the tarball from upstream sources, avoiding using outdated distribution package versions that lack important security fixes. The fetching will occur over Tor and on a disposable qube "disp-electrum-builder", which will then upload the files to the template "tpl-electrum". The installation on a disposable helps separate the wallet usage from ever connecting to the internet.

Installation

• Top:

sudo qubesctl top.enable electrum
sudo qubesctl --targets=sys-bitcoin-gateway,tpl-electrum-builder,tpl-electrum,disp-electrum-builder,electrum,electrum-hot state.apply
sudo qubesctl top.disable electrum
sudo qubesctl state.apply electrum.appmenus

• State:

sudo qubesctl state.apply electrum.create
sudo qubesctl --skip-dom0 --targets=sys-bitcoin-gateway state.apply sys-bitcoin.configure-gateway
sudo qubesctl --skip-dom0 --targets=tpl-electrum-builder state.apply electrum.install-builder
sudo qubesctl --skip-dom0 --targets=tpl-electrum state.apply electrum.install
sudo qubesctl --skip-dom0 --targets=disp-electrum-builder state.apply electrum.configure-builder
sudo qubesctl --skip-dom0 --targets=electrum state.apply electrum.configure
sudo qubesctl --skip-dom0 --targets=electrum-hot state.apply electrum.configure-hot
sudo qubesctl state.apply electrum.appmenus

Usage

The qube electrum serves as a cold wallet, while the electrum-hot is networked via tor. Both wallets can be watching-only or signing wallet, depending on how you configure them.

Connect your cold wallet to a trusted server

If you are running an Electrum Server with our formulas, such as sys-electrs, sys-electrumx, the formula documentation instructs how to make the server available to the client and the rest of this section doesn't apply to you.

If you server doesn't run with our formulas, you must do some extra steps.

Choose a netvm that can reach your Electrum Server and bind the server port to the netvm localhost. Prefer the port that supports SSL, normally 50002. In the following example, our server is running on 192.168.2.10:50002 and our netvm qube is named sys-net.

In the qube dom0, allow electrum to connect to sys-net port 50002 via Qrexec Policy in the file /etc/qubes/policy.d/30-user.policy:

qubes.ConnectTCP +50002 electrum @default allow target=sys-net

In the qube sys-net, add the socat command to the file /rw/config/rc.local:

socat TCP4-LISTEN:50002,reuseaddr,fork,bind=127.0.0.1 TCP:192.168.2.10:50002 &

In the qube electrum, add the qvm-connect-tcp command to the file /rw/config/rc.local:

qvm-connect-tcp ::50002

In the qube electrum, run as the user user the electrum configuration commands:

electrum --offline setconfig auto_connect false
electrum --offline setconfig oneserver true
electrum --offline setconfig server 127.0.0.1:50002

If you used a plain-text port, no SSL:

electrum --offline setconfig server 127.0.0.1:50001:t

Connect your cold wallet to an untrusted server

You should not use an untrusted third-party Electrum Server with this method because it only connects to a single server and it poses a higher security risk as the SPV method can not work with this design. If you don't have your own server, you are better off using electrum-hot and connecting to multiple public servers, you loose privacy (over Tor) in favor of security (no loss of Bitcoins).

As the client can't connect to other services to subscribe to block header notifications, the wallet is solely trusting the information delivered by the third-party server, whether its is lagging, splitting or forking the chain. The SPV method can not be executed because it does not have a minimum number of servers to verify the information against each other.

Read more about potention SPV weaknessses.

Recommendations for cryptographic operations

If you plan to create private keys or sign transaction, it is recommended to pause or shutdown all qubes to reduce the side-channel attack surface.

Although there is a possibility that there is not enough entropy source to create a secure wallet in a virtualized environment, this property is not taken care by this formula, it trusts the Kernel and Electrum Wallet to provide enough entropy.

Cold wallet terminology

I can expect some comments complaining about the term cold wallet when using Qubes OS with an online system. We use this term to refer to an isolated environment (a qube) that has no internet connection and can optionally reach an Electrum Server.

As a general rule, private keys should be stored on cold (offline) storage, because it greatly diminishes the attack surface of internet facing malware.

Should you decide to store the private key on a cold virtualized storage such as the electrum non-networked qube while other qubes have internet access or on a physically isolated machine normally referred as an air gapped system, every method has drawbacks.

As you have both types of wallets, a networked electrum-hot and an offline one electrum, with the networked wallet you can broadcast transactions while with the offline one, you sign them. Sharing data between the qubes can be done with qvm-copy and the process of combining a watching-only and a cold wallet is explained in the Electrum wiki.

Apart from the fact that most people loose Bitcoin by losing their private keys, being phished, using modified or outdated Bitcoin Node versions, the difficult part of securing your private key on a separate domain compared to the domain that can broadcast the transaction, is the trust you must assign to the less trusted domain to be able to send information to the more trusted domain. Such things are much worse when using non-Qubes because the transfer method is often insecure.

You are free to use a non-Qubes physically air-gapped system if you prefer, you just have to remove the Audio stack (microphone, speakers), Video stack (camera), USB stack (external ports, Bluetooth), Network stack (network cards), External reference lights (blinking pattern). If you use a hardware wallet, you are dependent on a specific hardware vendor and you will need to choose at least an insecure transfer method, scanning QR code where you can expose the camera to the data being read, connecting via NFC/USB/SD card exposes to the USB stack, transfer via radio exposes all devices nearby to the signal being passed, guard against supply-chain attacks. In the end, your air-gapped system is not so secure as you thought it to be.

QubesOS provides secure tools to communicate data between domains, most common ones are inter-VM File Copy and inter-VM clipboard. When using those programs, there is no USB, nor camera, nor radio signal used in those qubes, therefore not dealing with a lot of complicated and code that could expose higher risks or normal systems, but isolated on Qubes by UsbVMs, that holds the backend of the USB PCI bus devices.

Yes, a Xen exploit that reaches Dom0 or a CPU exploit that can infer the memory contents of other running VMs or the contents of data from a different execution context on the same CPU core can compromise private private keys, so it is up to you, the user, to choose your strategy.

Another possibility is a fully offline Qubes OS with this formula installed, but then again, transferring the data safely to communicate with a networked device for the transactions to be broadcasted is still a hard thing to fix for physical air-gapped systems.

We recommend reading former QubesOS developer, Joanna Rutkowska's paper about Software compartmentalization vs physical separation.

There is no consensus on the best solution, choose the option that you can have more security, not the one you "fell" more secure.

Credits

• qubenix