SLIP-0039, within the context of cryptocurrency and blockchain technology, refers to a specific standard proposed in the “Standard for Layered Implementations Proposal” (SLIP) series. This standard introduces a method known as Shamir Backup, a cryptographic algorithm developed by Adi Shamir, to enhance the security of recovery seeds, particularly in the context of hardware wallets like Trezor.
Key Features: Shamir Backup: SLIP-0039 introduces the Shamir Backup method, which involves the use of Shamir’s Secret Sharing Scheme. This cryptographic technique allows users to split a master secret, such as a cryptographic seed in the case of blockchain wallets, into multiple unique parts known as recovery shares.
Threshold Configuration: Users employing Shamir Backup can configure a predetermined threshold specifying the minimum number of recovery shares required to reconstruct the original master secret. This threshold can be customized based on security preferences, providing flexibility in recovery mechanisms.
Recovery Shares: Recovery shares are sequences of 20 or 33 English words, each representing a part of the cryptographic secret. These shares, when combined up to the specified threshold, enable the recovery of the wallet. The shares can be distributed among trusted friends or secure locations, mitigating the risks associated with theft or loss of a single backup.
Implementation: SLIP-0039 is implemented in the Trezor Model T, making it the first hardware wallet to adopt the fully functional Shamir Backup security standard. The standard enhances the security of recovery seeds, addressing common risks such as theft and loss.
Benefits: The use of SLIP-0039 and Shamir Backup offers enhanced security for cryptocurrency holders by providing a robust method for securing recovery seeds. It introduces redundancy and flexibility in the recovery process, reducing the susceptibility to complete loss in case of seed theft or loss.
Considerations: Users should be aware of the importance of managing and safeguarding their recovery shares, as failure to meet the configured threshold may render the wallet unrecoverable. Additionally, SLIP-0039 is specifically implemented on the Trezor Model T as of the last available information.
Related Terminology: BIP-39 – Mentioned in the context of SLIP-0039, BIP-39 refers to Bitcoin Improvement Proposal 39, which outlines standards for mnemonic codes used in the generation of deterministic wallets.