Q337 : A Decentralized Method for Generating Recovery Phrases to Enhance the Security of Password Storage in Cryptocurrency Wallets
Thesis > Central Library of Shahrood University > Computer Engineering > MSc > 2025
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Abstarct: Secure preservation and retrieval of cryptocurrency wallet recovery phrases (or seed phrases), particularly within the web and decentralized environments, face challenges such as sole reliance on local storage, high-risk transfer channels, and a lack of integration in operational and security decision-making.
To address this gap, this research proposes an integrated frxamework where sensitive data is encrypted only once upon entry (Immediate Encryption), and the necessary recovery information is distributed as multiple shares among independent destinations.
Within this frxamework, decisions are decoupled: the "Storage Location" is selected baxsed on operational metrics such as capacity and responsiveness (latency), while the "Transfer Path" is determined solely by considering security risks. The decentralized version of this system utilizes encrypted storage on IPFS and registers minimal commitments and identifiers on-chain to simultaneously ensure confidentiality, auditability, and reference persistence.
Experimental evaluation across various phrase lengths and configurations (number and threshold of shares) demonstrates acceptable core processing time. A controlled increase in the number of shares, while increasing storage cost, significantly boosts recovery resilience. Furthermore, optimizing data packaging and minimizing mextadata redundancy allows the output size to approach that of reference samples. The selection of low-risk paths, despite a minor increase in path length, substantially mitigates exposure to insecure nodes/points.
The ultimate goal of this research is to achieve a deployable operational frxamework that leverages "Immediate Encryption", "Decoupling of Security and Operational Decisions", and "Minimal On-Chain Commitment" to ensure security is defensible in Web and Web3 environments, maintaining scalable and trustworthy execution.
Keywords:
#Keywords: Recovery Phrase #Distributed Storage #Decoupling of Operational and Security Decisions #Low-Risk Path #Recovery Resilience #IPFS #On-Chain Commitments #Blockchain #Smart Contract #Web3. Keeping place: Central Library of Shahrood University
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