Canadian crypto hardware manufacturer Coinkite has designed a bitcoin hardware wallet reminiscent of an old-school BlackBerry phone straight out of the 2000s.
But the company says its new design reflects forward thinking on the tightest possible security measures and user-friendly features gleaned from customer feedback.
The soon-to-be-released device, dubbed Coldcard Q1, became available for pre-ordering on Feb. 9 and comes with a full keyboard, an LCD screen and an LED-illuminated QR code scanner.
The waffle-phone-style QWERTY keyboard gives off strong 2002 BlackBerry vibes and is supposed to cut down on so-called fat-finger errors when entering sensitive passwords, PINs and passphrases.
Coinkite added a battery compartment on the Q1’s rear side that fits three AAA batteries, so there’s no need for a tethered power supply, although a USB-C port is available for customers who prefer using a power cord.
It’s the company’s fifth iteration of a bitcoin hardware wallet, following the introduction of the MK line starting in 2018. The most-recent model, the Coldcard MK4, was released in February 2022.
The company aims to crack into the market-leadership ranks of hardware wallet makers, currently dominated by big names including Trezor and Ledger. But the overall market may be growing as more crypto investors seek out hardware wallets as an alternative to simply leaving coins on exchanges.
Outsiders may scoff at the Q1’s bulky, throwback user interface or UX, but Coinkite says it intentionally came up with that anachronistic design after consultations with users of its smaller, slimmer MK4.
The exact size, weight and price of the Q1 will be confirmed in the near future, but eager users can already reserve the device with a $199 deposit. The retail price is not expected to be much higher than the deposit amount.
“The Q1 was built mainly to help less advanced users,” Celia Cherif, a Coinkite business development representative, told CoinDesk in an interview. “We gathered their feedback from the MK4 and made everything more UX friendly for them in the Q1.”
Growing market for hardware wallets
Coinkite’s roots in the Bitcoin space go all the way back to 2011, when co-founders Rodolfo
Novak and Peter Gray stumbled across the Bitcoin white paper and later built a rudimentary bitcoin hardware wallet. The pair eventually incorporated as Coinkite, and the firm now produces and sells a suite of hardware and software Bitcoin products, including the MK4, which Cherif says is Coinkite’s best-selling product.
“Coldcard sales have been higher than expected,” Novak wrote in a tweet. Coinkite declined to provide CoinDesk with official sales data.
Last year’s implosion of Sam Bankman-Fried’s FTX crypto exchange triggered an exodus of customers from centralized exchanges to self-custody devices.
One crypto publication reported that two of the largest players in the hardware wallet space – Trezor and Ledger – captured a significant share of those spooked customers in November. According to the publication, Trezor reported a 300% increase in week-over-week sales while Ledger saw a six-fold increase in account creations for Ledger Live, the firm’s wallet management software.
Coinkite also saw an uptick in sales, although it’s not clear by how much. “Bitcoiners are so resolute on bitcoin and so many are getting off exchanges,” Novak tweeted. “In all my years, I’ve never seen so much activity.”
Convenience and ‘air-gapping’
The Q1’s design revolves around convenience and security, especially “air-gapping,” which means isolating the device from potentially unsecured networks like Wi-Fi or Bluetooth.
Cherif says that some less-tech-savvy customers reported difficulties using the MK4. Many customers were fumbling to enter sensitive passphrases, struggling to scan bitcoin address QR codes, dealing with the hassle of connecting power cords and switching back and forth between microSD cards.
With that backdrop, Coinkite designed the Q1 to include two microSD slots for saving wallet seed phrases – a series of 12 to 24 random words used to “recover” or regain private keys in the case of accidental loss. The double microSD slots offer more secure data transfer than traditional USB-A connections (more commonly referred to as simply “USB”), which Cherif says are vulnerable to all sorts of sophisticated cyberattacks.
“There’s a lot of vulnerabilities with USB data connectivity,” Cherif explained. “There’s a website created just to monitor all the known vulnerabilities. The list is never-ending. These are vulnerabilities that are being actively exploited by malicious actors.”
The firm’s engineers included both AAA batteries and the USB-C port as power sources for the Q1. Cherif also emphasized that the Q1’s USB-C port is strictly reserved for power transmission and not data transfer.
“If you choose to plug the USB-C cable into an Internet-connected device, it remains a much safer option than a USB cable because it doesn’t have any data lines connected, only power,” Cherif said.
Coinkite added a flashlight to the Q1 so users can easily scan Bitcoin QR codes (encoded Bitcoin addresses) in dim lighting.
The wallet has an LED QR code scanner instead of a video camera-based version. Coinkite says the choice was deliberate because cameras, being more technologically complex, are more prone to malicious hacks.
“The thing is, the camera is an attack vector,” Cherif explained.
A few Twitter users perusing details of the new device wondered out loud if the Q1’s large color LCD screen is able to display Ordinals, a new type of on-chain Bitcoin non-fungible token (NFT).
For now, the answer is “no,” although Coinkite is collaborating with Ordinals creator Casey Rodarmor on a project that uses a different Coinkite product – the Satschip – for Ordinals provenance (using a Bitcoin private key to prove ownership of an Ordinals NFT).