Saleem Rashid reports key-theft and pairing flaws in the Digital BitBox (BitBox01)
Who is affected
Digital BitBox (BitBox01) owners on old firmware were exposed to key theft by malware if they used the hidden wallet, and to transaction tampering during app pairing; the reset flaw required opening the device. Shift states it found no evidence of exploitation; the BitBox01 has since been discontinued.
What happened
On 26 November 2018 researcher Saleem Rashid published “Breaking into the (digital) BitBox”, describing several security issues in Shift Crypto’s first-generation hardware wallet, the Digital BitBox (later BitBox01). Rashid notes that he had reviewed only a small part of the firmware and hardware. Shift Crypto answered with a technical disclosure document dated 6 December 2018.
The most serious finding concerned the . According to Shift, the hidden wallet’s master xpub mistakenly used the standard wallet’s master private key as its chain code, so malware on a computer where both wallets had been opened could query both master xpubs and recombine them into the master private keys of both wallets. Rashid also showed that the LED “blink code” used to pair the device with the mobile verification app carried so little entropy that it could be brute-forced, letting malware on the computer sit between the BitBox and the app. With physical access and invasive probes on the line to the secure chip, the device could be reset without erasing the wallet secrets; Rashid adds that the brute-force counter for passphrase attempts could be bypassed the same way. A fourth issue was unauthenticated AES-CBC encryption of USB messages, which Shift says no one had shown how to exploit.
Shift states it fixed the hidden-wallet flaw in firmware v3.0.0 (12 March 2018, after finding it in February 2018), the pairing issue in v4.0.0 and the secure-chip issue in a patch released the same day (31 July 2018), and added a message authentication code to USB traffic in v5.0.0 (4 December 2018). Rashid writes that he did not review several of these fixes and that a first fix for the reset issue was ineffective before Shift changed it again. He describes the bug bounty he received as modest for the number of issues.
What Shift Crypto advises:
- Users who opened both the standard and the hidden wallet on the same computer before the v3.0.0 patch should move their funds to a new wallet, since a stolen master key cannot be ruled out.
- Redo the mobile verification app pairing on the latest firmware.
Cryptocurrency is a digital or virtual currency secured by cryptography, operating on decentralized blockchain networks to enable secure, peer-to-peer transactions.
Firmware is the software that runs on a hardware wallet itself: it generates keys, shows transaction details on the screen and signs.
Read full definitionXPUB is an extended public key (xpub) in hierarchical deterministic (HD) wallets. It derives child public keys and addresses from a master public key without exposing private keys.
Read full definitionA private key is the secret number that proves ownership of a crypto address and signs its transactions. Whoever has it controls the funds.
Malware is malicious software that steals or redirects crypto, for example by logging keystrokes, swapping copied addresses or reading wallet files.
Read full definitionEntropy is the randomness used to generate secure cryptographic keys or seeds in blockchain and cryptocurrency systems.
Read full definitionA secure element is a tamper-resistant chip built to store secrets and resist physical attacks such as side-channel analysis and fault injection.
Read full definitionA passphrase is an additional security layer for cryptocurrency wallets, acting as a 25th word in the BIP39 seed phrase, protecting access to hidden wallets.
Read full definitionSources
Independent reporting and research this entry was checked against.
Learn more
Guides on protecting yourself against this type of incident (Firmware vulnerability) and the glossary terms that describe it.
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Read GuideFirmware
Firmware is the software that runs on a hardware wallet itself: it generates keys, shows transaction details on the screen and signs.
Bootloader
A bootloader is a small program that initializes hardware and loads the main operating system or firmware on a device, often used in blockchain hardware wallets for secure startup.
Firmware Update
Firmware Update installs new low-level software on a hardware wallet to fix bugs, enhance security, or add features in cryptocurrency devices.
Cite this entry
WalletInsights. “Saleem Rashid reports key-theft and pairing flaws in the Digital BitBox (BitBox01)”. Hardware wallet security incident tracker. Last verified November 4, 2026. https://walletinsights.io/en/security-incidents/saleem-rashid-digital-bitbox-vulnerabilities-2018/
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