Sony Computer Science Laboratories, an arm of Sony Corporation, announced October 23, 2018, in a press release the development of a contactless IC card with the purpose of being used as a cryptocurrency hardware wallet.
As cryptocurrency becomes a more popular option for wealth accumulation and storing of funds, users are taking a second look at how exactly they are securing their coins.
While software wallets are typically safe enough for normal everyday use, those seeking extra security need to be careful. While the software wallets ensure users own the private key, which allows you to sign transactions to send tokens if the wallet is installed on an infected system, it’s very easy for hackers to steal your private keys and authorize transactions of their own.
Because of this, hardware wallets have seen a surge in popularity for both their convenience as well as extra security. Since the private keys are on a separate physical device isolated from the computer, the hardware wallet can be used safely even in infected environments.
The hardware wallets also act like cold storage when not connected, as the private keys remain offline unless plugged into a computer. This allows the user to combine the security advantages of a cold storage wallet with the connectivity and accessibility of a hot wallet.
While hardware wallets are an improvement from regular software wallets, their main disadvantage is that they need to be tethered to a computer.
While this is okay for desktop situations and for situations where funds are not immediately needed, hardware wallets are a poor choice for mobile payments, an area that cryptocurrency needs to compete against convenient solutions like credit cards and debit cards.
Sony fixes this by developing mutual authentication/encrypted communication technology within a single card, even making it possible to securely generate and store a private key within a tamper-proof module within the card.
Private keys for other information can be stored as well, allowing the card to also function in other ways users will be able to come up with.
The convenience of just tapping the card to pay is similar to the technology in Apple Pay, Google Pay, and new credit/debit cards which means the learning curve for adopting this is virtually nonexistent.