[Bitcoin-development] New side channel attack that can recover Bitcoin keys

[Gregory Maxwell]

On Wed, Mar 5, 2014 at 12:32 PM, Peter Todd <pete at petertodd.org> wrote:
> That's nice, but I wrote my advice to show people how even if they don't
> know any crypto beyond what the "black boxes" do - the absolute minimum
> you need to know to write any Bitcoin software - you can still defend
> yourself against that attack and many others.

But it's still incomplete.

Say you have an address— used only once!— with a txout with a lot of value.

Someone starts paying you small amounts to that address over and over
again. You haven't asked them to, they're just doing it.

Do you ignore the funds?— maybe tell some customer that was ignorantly
paying you over and over again to a single address "sorry, those are
my rules: I only acknowledge the first payment, those funds are
lost!".

No, of course not.  You spend the darn coins and if you're on a shared
host perhaps you disclose a private key.

The probability of an attack actually going on is low enough compared
to the cost of spending the coins in that case that even someone with
good knoweldge of the risks will choose to do so.

So absolutely, not reusing addresses massively increases your safety
and limits losses when there is theft. But it isn't enough alone. (Nor
is smarter signing, considering complex software like this has bugs
and its hard to be confident that something is side channel free— esp
when you allow attacker interference).