You shouldn’t trust anyone with your bitcoins, and Case is well aware of that. Over the past few years, Mt.Gox, Bitstamp and countless other centralized services have suffered serious security breaches. But Case is about to put an end to all this, as this startup has built one of the most secure hardware bitcoin wallets in the world. The startup is launching onstage today at Disrupt NY.
“There’s no easy and secure way to use bitcoin. You’re either getting security, or you’re getting ease of use,” co-founder and CEO Melanie Shapiro told me. Case wants to provide both — security and ease of use.
Case is a small credit card-shaped device with a tiny screen, a fingerprint sensor, a camera, a built-in GSM chip and a few buttons. Any time you want to make a bitcoin transaction, you press the bitcoin button, scan the QR code with the camera, swipe your finger and you’re done. Everything happens on the device; you don’t have to log in with a complicated password or use a smartphone app. You can even buy and sell bitcoins from this device.
Behind the scenes, Case provides a highly secured multi-signature wallet. You need two signatures to make a transaction. When you first start your Case device, you generate a private key on the device itself, and this key will stay on your device forever. “We don’t generate that private key — the device doesn’t come pre-populated with a private key,” Shapiro said.
Case also stores a key in its encrypted online database. Transactions are only signed by the server if the fingerprint scan matches your biometric data. The small device communicates with these servers using its built-in GSM chip. Case works like the Kindle with 3G connectivity, meaning that you can use the device in more than a hundred countries around the world without having to pay for a subscription.
But what if you lose your Case wallet? As you need two signatures to send bitcoins using Case, you won’t be able to recover your bitcoins. But fortunately the startup has a backup plan. It also stores a third key in an offline vault. You can retrieve this key after proving your identity to the company.
Case will cost $199 and will ship this summer after more than a year of hard work. The company is only starting to take pre-orders now. “We’ve seen a lot of hardware flops,” Shapiro said. “We wanted to be able to build the entire thing — the software, the firmware, the hardware. We are at that point now where we feel confident accepting pre-orders.”
Questions & Answers
Noah Lichtenstein: How much does it cost?
Answer: It costs $199.
Heidi Messer: Isn’t the pricing of the hardware going to make it impossible for emerging markets to get its benefit?
Answer: Right now we’re selling to consumers and most of the interest we can get is in the U.S. But also we are targeting institutional partnerships as well. The price point for a security device is accurate right now. However, the reason I got into bitcoin in the first place is the social impact.
Jessica Livingston: I’d love to hear more about the genesis of the idea. How did you think this is what I want to do?
Answer: I was a victim of bitcoin hacking. And I first heard about bitcoin when I was doing my PhD in consumer behavior. A lot of the conversations I was having were centered around this thing called bitcoin. I wanted to build something that wouldn’t scare of customers. What if you built a device that looks like a credit card? I made my credit card my design model. It should look like a credit card, it should be as easy to use as a credit card. So that’s where we began.
Shana Fisher: What do you think of the better funded further ahead wallets the talk about cold storage disconnected from the Internet?
Answer: The benefit of our device over traditional web wallets is security. Our devices are embedded. Everything that we wrote lives on the firmware. You don’t have to trust any app. It’s a multi-signature wallet and there are three keys. Being in possession one of the keys is a lot, you own it, you feel it. That is very empowering.
Jason Kincaid: Can you break into the firmware and get the physical token?
Answer: In the events that your device is compromised and for some reason your key is extracted from the device, that’s just one of three keys and you can’t spend anything.
Jason Kincaid: You built this firmware yourself. How do I know that this is most secure than other solutions. Why do I trust you?
Answer: We are building it for the ground up and you can trust us. We’re also open sourcing the software closer to the date of the shipment. We’re finishing the auditing process.
Heidi Messer: Will you support other currencies?
Answer: That’s definitely something we’re looking into.