Understanding Bitcoin Multi-Signature Hardware Wallet Performance: Insights from Jameson Lopp

The Challenge of Complexity in Bitcoin Transactions

Jameson Lopp, the co-founder and CTO of Casa, recently shared his findings on the performance of Bitcoin multi-signature hardware wallets in a blog post that’s sure to intrigue crypto enthusiasts. Lopp’s report, which surfaced on September 13, highlighted a crucial dilemma: while hardware wallets excel at handling simple and straightforward transactions, they struggle with more complex dealings. This may leave some users scratching their heads trying to understand why their seemingly savvy wallets hit a wall at times.

Test Setup: A Journey into the Technical Depths

To delve into this issue, Lopp conducted an exhaustive series of tests using the Electrum app on Debian Linux. He created diverse P2WSH (native segwit) multisig wallets, depending on a robust setup that allowed him to test the capabilities of various hardware wallets, such as Trezor, Ledger, Coinkite, Coldcard, and BitBox. Each wallet was outfitted with a deposit of 100 UTXOs to really put the hardware’s signing abilities to the test!

The Progress Indicator Pet Peeve

One issue that Lopp took particular umbrage with was the lack of progress indicators on some hardware devices. Spoiler alert: not knowing whether your transaction is being processed can lead to anxiety! Lopp expressed a preference for Coldcard and Trezor because they display clear loading and signing progress. On the flip side, devices like BitBox and Ledger left him feeling a tad more nervous, wishing for a reassuring “It’s working!” sign as he waited for transactions to process.

Strategies for Improvement

Based on his findings, Lopp made practical suggestions for hardware manufacturers to consider. He recommended splitting larger transactions into more manageable chunks to avoid processing delays. Imagine trying to shove a whole cake into your mouth at once—better to slice it! Moreover, he suggested that hardware wallets disable screen lock timeouts while they are engaged in a transaction to prevent unexpected freezes. These tweaks might just help users breathe easier when handling their crypto matters.

The Future of Hardware Wallets: A Call to Action

In the end, Lopp remains optimistic about the evolution of hardware wallets. He stresses the importance of manufacturers embracing their roles as platform providers, capable of fostering a rich ecosystem for various solutions. His vision involves hardware that seamlessly supports Partially Signed Bitcoin Transactions (PSBTs) and all valid multisig transactions. As he emphasized, “It’s high time for hardware manufacturers to step up to the plate!”