The Bitcoin Note is a Bitcoin bearer instrument which consists of currency-grade printed notes and secure NFC chips. Each Bitcoin Note stores information about Bitcoin keys that can be used to claim Bitcoin backing the note.
No. The Bitcoin is accessible through a multisig loaded by the first holder of the note. One key of the multisig, the “user key”, is generated by the first holder and stored in plaintext on the note. The second key, a “manufacturer key” is generated at the time of manufacture and stored, encrypted on the note.
The multisig requires both keys to access funds until the “Claim Before” date printed on the note at which point in time the multisig downgrades so that only the user key can claim the funds. Under no circumstance can the manufacturer key claim funds alone.
Bitcoin can be claimed off of the Bitcoin Note under two conditions: the first is by cutting a trace on the Bitcoin note indicated by the words “Cut to Claim” and reporting that information to us via the open source Bitcoin Note app. At that point in time we will return the decryption key for the manufacturer key stored on the note such that a transaction can be created to claim funds. The second method to claim funds is to wait until the date printed on the front of the note after which the plaintext user key stored on the note can be used to claim funds.
The claim before date indicates a point in time when the multisig changes from requiring both the user and manufacturer key to claim to just requiring the user key to claim. This ensures that even if we withhold the release of the decryption key required to use the manufacturer key that you can still claim Bitcoin off of the note in the future.
It also means that anyone who has encountered the note before that date could have saved the user key and there may be a race to claim, so we recommend claiming notes prior to that date or going through a re-key procedure with the note such that you are the only person with knowledge of the user key prior to placing it in cold storage. You should not accept a Bitcoin note in trade after that date.
No, the Bitcoin Notes are not shipped loaded as the first holder of the note supplies entropy which is used to generate the user key.
The Bitcoin Note is a great tool for teaching, gifting and holding Bitcoin. It does not replace individual wallets which hold dynamic amounts of Bitcoin or very large amounts of Bitcoin.
If we stop supporting the Bitcoin Note or refuse to release the decryption key for the manufacturer key, you can use the source code of the mobile applications to build the app and claim funds after the “claim before” date printed on the note.
A Bitcoin Note can be authenticated by scanning it via NFC. Our server will authenticate the note using keys embedded in the NFC chip.
Treat a Bitcoin Note like cash. If you lose it or destroy it you can’t access the funds.