This document outlines important security considerations when using the CLI Wallet application and provides best practices for cryptographic key management.

This application is designed for educational purposes only. It demonstrates cryptographic concepts and should not be used with real cryptocurrency or in production environments. The authors are not responsible for any loss of funds or security breaches.

The CLI Wallet uses industry-standard cryptographic algorithms:

• Elliptic Curve: secp256k1 (same curve used by Bitcoin and Ethereum)
• Hash Function: SHA-256 for message hashing and address generation
• Signature Scheme: ECDSA (Elliptic Curve Digital Signature Algorithm)
• Random Number Generation: Cryptographically secure random number generator

• Private Keys: 256-bit (32 bytes) random numbers
• Public Keys: Derived from private keys using elliptic curve point multiplication
• Signatures: ECDSA signatures providing authentication and non-repudiation
• Addresses: 160-bit (20 bytes) derived from SHA-256 hash of public key

1. Never Share Private Keys: Anyone with your private key can sign messages on your behalf
2. Generate Keys Securely: Always use cryptographically secure random number generation
3. Store Keys Safely: Use encrypted storage for private keys
4. Use Unique Keys: Generate separate key pairs for different purposes
5. Backup Securely: Create encrypted backups of important private keys

• Generate keys on secure, offline systems when possible
• Use hardware security modules (HSMs) for high-value keys
• Encrypt private keys before storing them
• Use strong, unique passwords for key encryption
• Create secure backups in multiple locations
• Test key recovery procedures regularly
• Use multi-signature schemes for shared control

• Store private keys in plain text
• Share private keys via email, chat, or other insecure channels
• Use predictable or weak random number sources
• Store keys on internet-connected systems unnecessarily
• Use the same private key for multiple purposes
• Screenshot or photograph private keys
• Store keys in cloud services without encryption

The CLI Wallet uses Rust's rand crate with the following security properties:

// Secure random number generation
use rand::rngs::OsRng;
use secp256k1::{Secp256k1, SecretKey};

let secp = Secp256k1::new();
let mut rng = OsRng;
let private_key = SecretKey::new(&mut rng);

Security Features:

• Uses operating system's cryptographically secure random number generator
• Provides sufficient entropy for cryptographic security
• Resistant to prediction and bias attacks
• Automatically seeded from system entropy sources

ECDSA signatures provide:

• Authentication: Proves the message was signed by the private key holder
• Non-repudiation: Signer cannot deny having signed the message
• Integrity: Any modification to the message invalidates the signature
• Uniqueness: Each signature is unique (due to random nonce generation)

• Hash messages before signing (automatically done by the application)
• Use deterministic nonces when possible (RFC 6979)
• Verify your own signatures after creating them
• Include timestamps or sequence numbers in signed messages
• Use message formats that prevent signature reuse attacks

• Sign empty or meaningless messages
• Reuse signatures across different contexts
• Sign messages you haven't read and understood
• Use predictable message formats that could be exploited
• Sign messages that could be interpreted differently in different contexts

When signing messages, consider:

# Good: Specific, contextual message
cli-wallet sign --message "Transfer 10 BTC to Alice on 2024-01-15 at 14:30 UTC"

# Bad: Generic message that could be misused
cli-wallet sign --message "I agree"

• Always verify signatures before trusting signed messages
• Check that the public key belongs to the expected signer
• Verify the message content matches your expectations
• Use secure channels to obtain public keys
• Implement proper error handling for verification failures

• Trust signatures without verification
• Assume a signature is valid just because it "looks right"
• Use public keys from untrusted sources
• Skip verification in automated systems
• Ignore verification errors or warnings

Public keys themselves need to be authenticated:

1. Certificate Authorities: Use PKI infrastructure when available
2. Web of Trust: Verify keys through trusted intermediaries
3. Out-of-Band Verification: Confirm keys through separate communication channels
4. Key Fingerprints: Use key fingerprints for manual verification
5. Blockchain Records: Use immutable ledgers for key publication

The CLI Wallet implements several memory security practices:

• No Persistent Storage: Private keys are only held in memory during operation
• Secure Cleanup: Sensitive data is cleared from memory when possible
• Stack Allocation: Uses stack allocation for temporary cryptographic data
• Rust Safety: Benefits from Rust's memory safety guarantees

All user inputs are validated:

// Example: Private key validation
pub fn validate_private_key_hex(hex_str: &str) -> Result<SecretKey, WalletError> {
    // Length validation
    if hex_str.len() != 64 {
        return Err(WalletError::invalid_input("Invalid key length"));
    }

    // Hex format validation
    let bytes = hex::decode(hex_str)?;

    // Cryptographic validation
    SecretKey::from_slice(&bytes)
        .map_err(|e| WalletError::key_generation(format!("Invalid key: {}", e)))
}

The application provides secure error handling:

• No Information Leakage: Error messages don't reveal sensitive information
• Consistent Timing: Avoids timing attacks through consistent error handling
• Clear Feedback: Provides helpful error messages without security risks
• Graceful Degradation: Fails securely when errors occur

The CLI Wallet is designed for offline use:

• No Network Connections: Never transmits keys or signatures over networks
• Air-Gapped Operation: Can be used on systems without network access
• Local Processing: All cryptographic operations happen locally
• No Telemetry: Doesn't collect or transmit usage data

When sharing public keys or signatures:

• Encrypted email with verified recipients
• Secure messaging apps with end-to-end encryption
• In-person exchange of key fingerprints
• Secure file sharing with access controls
• QR codes for short-distance sharing

• Unencrypted email or messaging
• Public forums or social media
• Unsecured file sharing services
• SMS or phone calls
• Unverified communication channels

The CLI Wallet protects against:

• Key Prediction: Uses cryptographically secure random generation
• Signature Forgery: ECDSA signatures cannot be forged without the private key
• Message Tampering: Signatures become invalid if messages are modified
• Replay Attacks: Each signature is unique and message-specific
• Implementation Attacks: Uses well-tested cryptographic libraries

The CLI Wallet does NOT protect against:

• Malware: Malicious software could steal keys from memory
• Physical Access: Attackers with physical access could extract keys
• Side-Channel Attacks: Timing or power analysis attacks
• Social Engineering: Tricking users into revealing keys
• Quantum Computers: Future quantum computers could break ECDSA
• Implementation Bugs: Potential vulnerabilities in dependencies

Low Risk Scenarios:

• Educational use with test keys
• Learning cryptographic concepts
• Demonstrating signature schemes
• Academic research projects

High Risk Scenarios:

• Managing real cryptocurrency keys
• Production financial applications
• High-value asset management
• Mission-critical authentication systems

1. Stop Using the Key: Immediately cease all operations with the compromised key
2. Generate New Keys: Create new key pairs using secure methods
3. Notify Stakeholders: Inform anyone who relies on the compromised public key
4. Revoke Certificates: If using PKI, revoke any certificates for the key
5. Audit Usage: Review all signatures created with the compromised key
6. Update Systems: Replace the compromised key in all systems

1. Verify Inputs: Double-check the message, signature, and public key
2. Check Key Authenticity: Ensure the public key is from the expected source
3. Investigate Tampering: Look for signs of message or signature modification
4. Contact Signer: Verify the signature directly with the claimed signer
5. Document Issues: Keep records of verification failures for analysis

• "Applied Cryptography" by Bruce Schneier: Comprehensive cryptography reference
• "Cryptography Engineering" by Ferguson, Schneier, and Kohno: Practical crypto implementation
• NIST Cryptographic Standards: Official US government crypto standards
• RFC 6979: Deterministic Usage of DSA and ECDSA
• SEC 2: Recommended Elliptic Curve Domain Parameters

• OWASP Cryptographic Storage Cheat Sheet: Web application crypto security
• NIST Cybersecurity Framework: Comprehensive security framework
• ISO 27001: Information security management standards
• Common Criteria: Security evaluation standards

• Rust Security Advisory Database: Known vulnerabilities in Rust crates
• RustSec: Security-focused Rust community
• Cargo Audit: Tool for checking dependencies for security issues

Security in cryptographic applications requires careful attention to:

1. Key Management: Secure generation, storage, and handling of private keys
2. Implementation Security: Using well-tested libraries and secure coding practices
3. Operational Security: Following best practices for key usage and verification
4. Threat Awareness: Understanding what the system can and cannot protect against

Remember: This application is for educational purposes only. For production use cases involving real cryptocurrency or sensitive data, consult with security professionals and use established, audited solutions.

Last Updated: January 2024
Version: 1.0
Contact: For security questions or concerns, please review the code and consult with qualified security professionals.