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Backup-Recovery-Best-Practices.md

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Backups & Recovery - Best Practices

  • Use a dummy 12 word signer as your iCloud encryption password and save it offline.
  • Test your backup by actually deleting and recovering data!
  • Use iCloud backups as your primary method of storing backups.
  • Use wallet files for backing up wallet meta data such as transaction labels, memos and capital gains info.
  • Always store signers offline in plain text in a safe, preferably in multiple secure locations.

TEST YOUR BACKUPS

iCloud

Since v0.2.24 Fully Noded allows users to create an encrypted iCloud backup.

iCloud backups currently encompass the following entities:

  • Wallets
  • Nodes
  • Signers
  • Tor V3 Auth Keys

⚠️ Transaction labels, memos and capital gains info are not currently included in iCloud backups ⚠️

You can view the following video demos for utilizing iCloud backups and recovery:

How to use iCloud

  • Creating a backup: Settings > Create/update iCloud backup
    • At that point you will be prompted to enter in an encryption password and confirm it.
  • Recover your nodes, signers, wallets and Tor auth keys: Setting > Recover from iCloud
    • At that point you will be prompted to enter the same encryption password you used to create the backup.
  • Deleting a backup: Settings > Delete iCloud backup
    • No password is required to delete the backup, that is incase you forgot the original password.

How it works under the hood

Fully Noded will take the encryption password you provide and sha256 hash it. The resulting hash is then used to encrypt your data before being stored. Fully Noded will never remember this hash, it immediately forgets it. What it does remember is the double sha256 hash of your encryption key so that when the user goes to recover and decrypt data we can compare the double sha256 hash to what was used when the original backup was created. Otherwise it would be too easy for users to accidentally brick a backup or create one backup with multiple encryption keys. If the original encryption password is lost just delete the backup and create a new one.

Wallet files

Wallet backup files do not contain private keys

Users may navigate to Settings > Wallet backup to create a plain text wallet export file which stores your xpubs, transactions, utxos, labels, memos and capital gains meta data. It is recommended to use GPG or a similar tool to encrypt these files otherwise an attacker will gain intimate knowledge of your holdings, transaction history, utxos etc...

You can test that the wallet backup file works by creating a backup file, deleting a memo on a random transaction and then recovering that file. If the recovery worked the label or memo you just deleted will reappear after loading the wallet that is associated with that txid. Or simply delete the app, add a node and import the recovery file and all wallet data should return instantly.

Wallet QR codes

Wallet backup QR codes do not hold private keys

The simplest and quickest recovery method is scanning a wallet backup QR code. This recovers one wallet at a time and does not include meta data about transactions or utxos. This is ideal for people who worry about losing xpubs for their multi-sig wallets.

Signers

Signers must be backed up offline on a piece of paper or metal

To make a wallet spendable you can either recover via iCloud, QR code or wallet file and then simply add the appropriate signer to the app by navigating to Signers > + and inputting the words one at a time or pasting all of them in one go. Of course you must pay special attention to whether you added a passphrase to that seed in order for the wallet to actually sign transactions.