The usability imperative for securing digital asset devices

When Tony Fadell started working on the iPod, usability often trumped security. The result was an iterative process. Every time someone would find a security weakness or a way to hack the device, the development group would iterate to add measures and fix the issues. Yet, flaws would frequently be found, and the secure design of the product became a moving target.

But when it came to designing a device specifically for security purposes, there could be no iterative process after rolling it out: Security had to be the number one priority. 

“As you develop these things, you’re a victim of your own development speed,” says Fadell, who developed Ledger Stax, a signing device for securing digital assets, and is now a board member at digital asset security firm Ledger. “If you introduced these features and functions without the proper review, and now customers are demanding security, you’ll realize that you should have designed it differently from the start, and it’s very hard to undo what you’ve already done.”

A critical aspect of designing secure technology, however, must be ease of use too. Without it, it is all too simple for users to make a mistake or use an unsafe workaround that undermines device protections. Think a post-it stuck to a monitor or some variation of “123456” or “admin” for passwords.

With digital asset security devices like signers—more commonly called “wallets”—such errors could lead to seriously detrimental outcomes. If, for example, a user’s private key falls into the wrong hands, bad actors can use it to steal their digital assets. Estimates suggest that around 20% of all Bitcoin—worth around $355 billion—are inaccessible to owners. One of the reasons for this is likely because they lost their private keys.

In the past, crypto devices have been notoriously difficult to use. As cryptocurrency becomes ever more popular, valuable, and mainstream—attracting greater attention from criminals as the stakes rise—designers and engineers are prioritizing both security and usability when developing digital asset devices, drawing on in-depth research to iterate.

The three components of security

Strong security models for devices like signers, which are used to secure blockchain transactions,  require three major components. First, a secure operating system. Second, a secure element to bind the software to the hardware. And third, a secure user interface. Each of which need to be frequently tested by researchers and white hat hackers to simulate real-world attacks and improve product resilience and usability.

The first two elements focus on securing the device software and hardware. Secure software has always been a problem, but one that has improved over the last decade, as security architectures and processes have been refined. Meanwhile, hardware security components have become widely available—from trusted platform modules on computers to secure enclaves in smartphones—allowing digital information to essentially be locked to a device.

For crypto signers, hardware must provide encryption capabilities. And the security of the software must be frequently tested. Ledger, for example, has a secure OS and a Secure Element that handles encryption primitives, and a secure display that prevents device takeover.

Security and usability working hand in hand

Asset recovery is a major consideration when designing signers. If recovery options are not easy to use, an owner could lose access. But if recovery processes are not secure enough, attackers could exploit the system. With SIM swapping attacks, for example, attackers can tap into a mobile communications channel used for account recovery and “recover” a victim’s password to steal their assets.

In the digital-asset ecosystem, the creation of the seed phrase, a sequence of 12 to 24 words that could act as a passphrase for wallets is an example of improving usability and security. Known more formally as Bitcoin Improvement Proposal 39 (BIP-39), the approach gives users a master password to unlock their hierarchical deterministic (HD) wallets. 

There is a lot of creative tension between the security team and the UX team that happens to achieve the proper balance between convenience and safety, Fadell says, referring to Ledger’s security research team, the Donjon. “We mock things up, we prototype things from a UX UI perspective, we walk through it, then we walk the Donjon team through it,” Fadell explains. “We push back and forth to find the absolute optimal solution to balance the two.” 

Through the research the Donjon team has conducted, Ledger designed its Recovery Key—an NFC-based physical card to back up your 24 words—to be both user-friendly and secure. “What we did, as a first in the industry, was include an NFC card,” says Fadell. “Instead of only writing it down, you can also have an NFC card called a Recovery Key. You can have multiple Recovery Keys and store them in a lockbox, a safety deposit box, or give them to someone you trust for safekeeping.”

A number of government initiatives are working to regulate this balance between security and usability. This includes the US Cybersecurity and Infrastructure Security Agency’s Secure by Design, which aims to build cybersecurity into the design and manufacture of technology products. And the UK’s National Cyber Security Centre’s Software Security Code of Practice, which outlines security principles expected of all organizations that develop or sell software. 

Enterprise security presents distinct challenges

Embedding usability and security into devices for companies adds further complexity as businesses need features such as multi-signature capabilities to protect against single points of failure, whether from external attacks or internal bad actors. 

Security design can take these requirements into account, with secure governance using multiple signatures (multisig), hardware security modules (HSMs) for key storage, trusted display systems, and other usable security capabilities.

These technologies are critically important for companies who have roles in the blockchain ecosystem. Failure to establish robust security measures can have dire consequences. In 2024, for example, unknown cybercriminals made off with more than $300 million worth of assets from DMM Bitcoin, leading the Japanese cryptocurrency platform to close six months later. Japan’s Financial Services Agency discovered severe risk management issues, including inadequate oversight, lack of independent audits, and poor security practices.

For companies, allowing a multi-stage process that involves a required number of stakeholders is critical, says Fadell. “It’s making sure that the attack vector is not just one person, and so you need to support multiple people with multiple factors on all of their devices as well,” he says. “It gets to be a real combinatoric problem.”

R&D to stay one step ahead 

To keep up with requirements and offer strong security with improved visibility, crypto firms need to invest in research and development, Fadell says. Attack labs, such as Ledger Donjon, can conduct real-world testing on specific enterprise security requirements and create scenarios to educate both management and workers of the potential threats. 

Such research and development can support device designers and engineers in their never-ending mission to balance security measures with usability so that digital asset devices can support users to safeguard their digital assets in a constantly evolving crypto and cyber landscape.

Learn more about how to secure digital assets in the Ledger Academy.

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