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3. Advanced Course

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  1. 1. What is Taproot?
  2. 2. Blockchain bridges – what are they?
  3. 3. What is Ethereum Plasma?
  4. 4. What is Ethereum Casper?
  5. 5. What is Zk-SNARK and Zk-STARK? 
  6. 6. What is Selfish Mining? 
  7. 7. What is spoofing in the cryptocurrency market? 
  8. 8. Schnorr signatures - what are they? 
  9. 9. MimbleWimble - what is it? 
  10. 10. What is digital property rights in NFT?
  11. 11. What are ETFs and what role do they play in the cryptocurrency market? 
  12. 12. How to verify a cryptocurrency project – cryptocurrency tokenomics 
  13. 13. What is the 51% attack on blockchain?
  14. 14. What is DAO, and how does it work?
  15. 15. Zero-knowledge proof – a protocol that respects privacy 
  16. 16. What is EOSREX?
  17. 17. What is Proof of Elapsed Time (PoET)?
  18. 18. Mirror Protocol – what it is? 
  19. 19. What are synthetic assets? 
  20. 20. How to create your own NFT? 
  21. 21. Definition of DeFi, and what are its liquidations?
  22. 22. New identity system - Polygon ID
  23. 23. Ethereum Foundation and the Scroll protocol - what is it?
  24. 24. What is Byzantine fault tolerance in blockchain technology?
  25. 25. Scalability of blockchain technology - what is it?
  26. 26. Interchain Security - new Cosmos (ATOM) protocol
  27. 27. Coin Mixing vs. Coin Join - definition, opportunities, and threats
  28. 28. What is Ethereum Virtual Machine (EVM) and how does it work?
  29. 29. Soulbound Tokens - what are they, and how do they work?
  30. 30. Definition of LIDO - what is it?
  31. 31. What are Threshold Signatures, and how do they work?
  32. 32. Blockchain technology and cyberattacks.
  33. 33. Bitcoin script - what it is, and what you should know about it.
  34. 34. What is zkEVM, and what are its basic features?
  35. 35. Do confidential transactions on blockchain exist? What is a Confidential Transaction?
  36. 36. Algorithmic stablecoins - everything you should know about them.
  37. 37. Polygon Zk Rollups ZKP - what should you know about it?
  38. 38. What is Web3 Infura?
  39. 39. Mantle - Ethereum L2 scalability - how does it work?
  40. 40. What is the NEAR Rainbow Bridge?
  41. 41. Liquid Staking Ethereum and LSD tokens. What do you need to know about it?
  42. 42. Top 10 blockchain oracles. How do they work? How do they differ?
  43. 43. What are Web3.js and Ether.js? What are the main differences between them?
  44. 44. What is StarkWare, and recursive validity proofs
  45. 45. Quant Network: scalability of the future
  46. 46. Polygon zkEVM - everything you need to know
  47. 47. What is Optimism (OP), and how do its roll-ups work?
  48. 48. What are RPC nodes, and how do they work?
  49. 49. SEI Network: everything you need to know about the Tier 1 solution for DeFi
  50. 50. Types of Proof-of-Stake Consensus Mechanisms: DPoS, LPoS and BPoS
  51. 51. Bedrock: the epileptic curve that ensures security!
  52. 52. What is Tendermint, and how does it work?
  53. 53. Pantos: how to solve the problem of token transfer between blockchains?
  54. 54. What is asymmetric encryption?
  55. 55. Base-58 Function in Cryptocurrencies
  56. 56. What Is the Nostr Protocol and How Does It Work?
  57. 57. What Is the XDAI Bridge and How Does It Work?
  58. 58. Solidity vs. Rust: What Are the Differences Between These Programming Languages?
  59. 59. What Is a Real-Time Operating System (RTOS)?
  60. 60. What Is the Ethereum Rinkeby Testnet and How Does It Work?
  61. 61. What Is Probabilistic Encryption?
  62. 62. What is a Pinata in Web 3? We explain!
  63. 63. What Is EIP-4337? Will Ethereum Account Abstraction Change Web3 Forever?
  64. 64. What are smart contract audits? Which companies are involved?
  65. 65. How does the AirGapped wallet work?
  66. 66. What is proto-danksharding (EIP-4844) on Ethereum?
  67. 67. What is decentralised storage and how does it work?
  68. 68. How to Recover Cryptocurrencies Sent to the Wrong Address or Network: A Practical Guide
  69. 69. MPC Wallet and Multilateral Computing: Innovative Technology for Privacy and Security
  70. 70. Threshold signature in cryptography: an advanced signing technique!
  71. 71. Vanity address in cryptocurrencies: what is it and what are its characteristics?
  72. 72. Reentrancy Attack on smart contracts: a threat to blockchain security!
  73. 73. Slither: a static analyser for smart contracts!
  74. 74. Sandwich Attack at DeFi: explanation and risks!
  75. 75. Blockchain RPC for Web3: A key technology in the world of decentralized finance!
  76. 76. Re-staking: the benefits of re-posting in staking!
  77. 77. Base: Evolving cryptocurrency transactions with a tier-2 solution from Coinbase
  78. 78. IPFS: A new era of decentralized data storage
  79. 79. Typical vulnerabilities and bridge security in blockchain technology
Lesson 65 of 79
In Progress

65. How does the AirGapped wallet work?

With the development of the popularity of cryptocurrencies, a number of proposals for cryptocurrency wallets have appeared on the market, with which we can safely store our digital assets. Currently, we have several providers on the market, and each of them is constantly trying to improve their devices.

We can use wallets that generate sets of keys for us, or we can opt for something more complicated, like having a device sign our transaction. This generates offline keys and is known as cold storage.

We can also choose AirGapped wallets, which are completely disconnected from the internet and all, wireless forms. They have no access to Internet connections, WiFi or even a USB drive. Their biggest advantage is that they completely eliminate hacking and virus attacks. Despite these advantages, AirGapped wallets are much less convenient than the others. Why? This question will be answered in our lesson today!

What is airgap?

Airgap is a security tool that automatically isolates a device from an untrusted network, such as the Internet, by removing all network interfaces. For example, airgap-enabled computers are used where we have security criticality.

In a very similar way, airGappedportfolios work. It is designed in such a way that there is no access to any form of wireless communication, i.e. internet, WiFi, NFC or even USB.

The term ‘air gap’ itself comes from the concept of having an ‘air gap’, between the wallet and wireless communications. It thus provides an additional layer of security against intrusions and exploits.

In theory, this type of wallet is supposed to be more secure, thanks to the physical connection between it and the computer.

How do AirGapped wallets work?

They are based on scannable QR codes or micro-SD cards. Transaction data can be stored on these small memory cards. The AirGappedwallet uses an application installed on your computer that supports PSBT (Partially Signed Bitcoin Transactions) for Bitcoin or another similar one for other cryptocurrencies. Let’s now walk through the process of transferring cryptocurrencies using this wallet:

  1. The user creates an unsigned transaction in the signing device application.
  2. The transaction is usually encoded in a QR code, which we scan with a hardware wallet.
  3. The transaction is recorded and stored as a file, which we read using a microSD card.
  4. The hardware wallet signs the transaction with its private keys and displays the signed transaction on the computer. It uses a QR code or microSD card for this.
  5. The computer application transmits the signed transaction to the network.

Types of AirGapped portfolios

This type of portfolio can come in various forms. However, we can most commonly encounter:

AirGapped hardware wallets. These are purpose-built wallets designed to store private keys offline. They facilitate transactions without exposing private keys. This type of device typically has digital screens to display transaction information and manual buttons to approve transactions.

AirGapped computers. You can also prepare an entire computer to serve you as this type of wallet. Such hardware is never connected to the Internet and is only used to store private keys and sign transactions.

On AirGapped computers, transactions are transmitted via a USB stick. Signed transactions are transmitted in exactly the same way. The approach is more complex and requires more technical skills.

AirGapped. Smartphones work similarly to computers with the same function. We restore the phones to factory settings and configure them without an Internet connection. We install the wallet software using an SD card.

Which wallet is best?

There is no clear answer to this question. However, you can always use several. You can store some of your funds in a classic wallet and some in AirGapped. Add to this additional security measures, such as multi-sig or key distribution. You have a ready-made solution and don’t need to deliberate which option is best for you.

Summary

Clearly, AirGapped wallets take security to new heights. This is very important especially for those who have their funds for a long time. AirGapped wallets provide high protection against threats by storing keys on a device that is never connected to the internet.

However, despite these features, you must know that this type of wallet is not reliable and is not for everyone. Those who perform many transactions a day will not be satisfied with this solution. The choice of wallet depends on its purpose and the user.

Complete today’s lesson!

  1. What are these cryptocurrencies? [BASIC LEVEL]
  2. Cryptocurrency wallets – what are they? [BASIC LEVEL].
  3. What does portfolio diversification mean? [BASELINE]