Skip to main content

🔐 Security Overview

Enterprise-grade security for the BLGV Bitcoin-native ecosystem.

🎯 Security Philosophy​

Bitcoin-Native Security​

  • Proof-of-Reserves - Real-time, verifiable Bitcoin holdings
  • Multi-Signature Wallets - No single point of failure
  • Hardware Security Modules - Keys never touch hot storage
  • Zero-Trust Architecture - Every request verified

Defense in Depth​

🔑 Authentication & Authorization​

Multi-Factor Authentication​

interface AuthFactors {
  password: string;           // Something you know
  biometric: BiometricData;   // Something you are  
  walletSignature: string;    // Something you own (Bitcoin wallet)
  deviceToken: string;        // Trusted device
}

const authenticateUser = async (factors: AuthFactors) => {
  // Verify all factors before granting access
  const results = await Promise.all([
    verifyPassword(factors.password),
    verifyBiometric(factors.biometric),
    verifyWalletSignature(factors.walletSignature),
    verifyDevice(factors.deviceToken)
  ]);
  
  return results.every(result => result.valid);
};

Role-Based Access Control (RBAC)​

enum UserRole {
  VIEWER = 'viewer',
  TRADER = 'trader', 
  ADMIN = 'admin',
  TREASURY = 'treasury'
}

const permissions = {
  [UserRole.VIEWER]: ['read:dashboard', 'read:analytics'],
  [UserRole.TRADER]: ['read:markets', 'write:orders'],
  [UserRole.ADMIN]: ['read:*', 'write:users', 'write:settings'],
  [UserRole.TREASURY]: ['read:*', 'write:treasury', 'sign:transactions']
};

🛡️ API Security​

Rate Limiting​

const rateLimiter = rateLimit({
  windowMs: 15 * 60 * 1000, // 15 minutes
  max: 100, // Limit each IP to 100 requests per windowMs
  message: 'Too many requests from this IP',
  standardHeaders: true,
  legacyHeaders: false,
});

// Stricter limits for sensitive endpoints
const sensitiveRateLimit = rateLimit({
  windowMs: 60 * 1000, // 1 minute
  max: 5, // 5 requests per minute
  skipSuccessfulRequests: true,
});

Request Validation​

import { z } from 'zod';

const TransactionSchema = z.object({
  amount: z.number().positive().max(1000000), // Max 1M sats
  recipient: z.string().regex(/^[a-zA-Z0-9]{26,35}$/), // Bitcoin address
  memo: z.string().max(100).optional(),
});

const validateTransaction = (req: Request, res: Response, next: NextFunction) => {
  try {
    TransactionSchema.parse(req.body);
    next();
  } catch (error) {
    res.status(400).json({ error: 'Invalid transaction data' });
  }
};

HMAC Signature Verification​

const verifyHMAC = (req: Request, res: Response, next: NextFunction) => {
  const signature = req.headers['x-blgv-signature'] as string;
  const payload = JSON.stringify(req.body);
  const secret = process.env.HMAC_SECRET!;
  
  const expectedSignature = crypto
    .createHmac('sha256', secret)
    .update(payload)
    .digest('hex');
    
  if (!crypto.timingSafeEqual(
    Buffer.from(signature, 'hex'),
    Buffer.from(expectedSignature, 'hex')
  )) {
    return res.status(401).json({ error: 'Invalid signature' });
  }
  
  next();
};

💾 Data Protection​

Encryption at Rest​

// Database encryption
const encryptedFields = {
  privateKey: {
    type: DataTypes.TEXT,
    get() {
      const encrypted = this.getDataValue('privateKey');
      return encrypted ? decrypt(encrypted) : null;
    },
    set(value: string) {
      this.setDataValue('privateKey', encrypt(value));
    }
  }
};

// File encryption
const encryptFile = (data: Buffer, key: string): Buffer => {
  const cipher = crypto.createCipher('aes-256-gcm', key);
  return Buffer.concat([cipher.update(data), cipher.final()]);
};

Encryption in Transit​

// TLS 1.3 configuration
const tlsOptions = {
  minVersion: 'TLSv1.3',
  ciphers: [
    'TLS_AES_256_GCM_SHA384',
    'TLS_CHACHA20_POLY1305_SHA256',
    'TLS_AES_128_GCM_SHA256'
  ].join(':'),
  honorCipherOrder: true,
  secureProtocol: 'TLSv1_3_method'
};

₿ Bitcoin Security​

Multi-Signature Wallets​

interface MultiSigWallet {
  requiredSignatures: number; // e.g., 3
  totalSigners: number;       // e.g., 5
  signers: PublicKey[];
  policy: SigningPolicy;
}

const createMultiSigTransaction = async (
  wallet: MultiSigWallet,
  transaction: Transaction
) => {
  // Require multiple signatures for treasury transactions
  const signatures = await collectSignatures(wallet.signers, transaction);
  
  if (signatures.length < wallet.requiredSignatures) {
    throw new Error('Insufficient signatures');
  }
  
  return finalizeTransaction(transaction, signatures);
};

Hardware Security Modules (HSM)​

class HSMManager {
  private hsm: HSMClient;
  
  async signTransaction(transaction: Transaction): Promise<Signature> {
    // Keys never leave the HSM
    return await this.hsm.sign({
      data: transaction.hash(),
      keyId: 'treasury-signing-key',
      algorithm: 'ECDSA-SHA256'
    });
  }
  
  async generateKey(): Promise<string> {
    return await this.hsm.generateKey({
      algorithm: 'secp256k1',
      extractable: false // Key cannot be exported
    });
  }
}

🔍 Monitoring & Incident Response​

Security Event Logging​

enum SecurityEvent {
  LOGIN_ATTEMPT = 'login_attempt',
  LOGIN_SUCCESS = 'login_success', 
  LOGIN_FAILURE = 'login_failure',
  SUSPICIOUS_ACTIVITY = 'suspicious_activity',
  API_RATE_LIMIT = 'api_rate_limit',
  TRANSACTION_SIGNED = 'transaction_signed'
}

const logSecurityEvent = (event: SecurityEvent, data: any) => {
  const logEntry = {
    timestamp: new Date().toISOString(),
    event,
    data,
    userAgent: data.userAgent,
    ipAddress: data.ipAddress,
    userId: data.userId
  };
  
  // Send to security monitoring system
  securityLogger.warn(logEntry);
  
  // Alert on critical events
  if (event === SecurityEvent.SUSPICIOUS_ACTIVITY) {
    alertSecurityTeam(logEntry);
  }
};

Anomaly Detection​

const detectAnomalies = async (userId: string, action: string) => {
  const userBehavior = await getUserBehaviorProfile(userId);
  const currentBehavior = {
    timeOfDay: new Date().getHours(),
    location: await getLocationFromIP(),
    device: getDeviceFingerprint(),
    action
  };
  
  const riskScore = calculateRiskScore(userBehavior, currentBehavior);
  
  if (riskScore > RISK_THRESHOLD) {
    await triggerAdditionalVerification(userId);
    logSecurityEvent(SecurityEvent.SUSPICIOUS_ACTIVITY, {
      userId,
      riskScore,
      action
    });
  }
};

🚨 Incident Response​

Automated Response​

const incidentResponse = {
  [ThreatLevel.LOW]: {
    actions: ['log', 'monitor'],
    escalation: false
  },
  [ThreatLevel.MEDIUM]: {
    actions: ['log', 'rate_limit', 'notify_team'],
    escalation: true
  },
  [ThreatLevel.HIGH]: {
    actions: ['log', 'block_ip', 'lock_account', 'alert_security'],
    escalation: true
  },
  [ThreatLevel.CRITICAL]: {
    actions: ['emergency_lockdown', 'freeze_transactions', 'contact_authorities'],
    escalation: true
  }
};

Emergency Procedures​

class EmergencyLockdown {
  async initiate(reason: string, triggeredBy: string) {
    // 1. Stop all trading
    await tradingEngine.halt();
    
    // 2. Freeze withdrawals
    await walletService.freezeWithdrawals();
    
    // 3. Notify all users
    await notificationService.broadcastEmergency(
      'System temporarily unavailable for security reasons'
    );
    
    // 4. Alert security team
    await alertSecurityTeam({
      event: 'EMERGENCY_LOCKDOWN',
      reason,
      triggeredBy,
      timestamp: new Date().toISOString()
    });
  }
}

🔒 Security Best Practices​

Development Security​

  • Code Review - All code reviewed by security team
  • SAST/DAST - Static and dynamic security testing
  • Dependency Scanning - Monitor for vulnerable packages
  • Secrets Management - Never commit secrets to git

Infrastructure Security​

  • Zero-Trust Network - All network traffic encrypted and authenticated
  • Container Security - Minimal, hardened container images
  • Regular Updates - Automated security patches
  • Backup Encryption - All backups encrypted at rest

Operational Security​

  • Principle of Least Privilege - Minimum required access
  • Separation of Duties - No single person can execute high-risk actions
  • Regular Audits - Internal and external security audits
  • Security Training - Regular team security awareness training

📊 Security Metrics​

Key Performance Indicators​

  • Mean Time to Detection (MTTD) - < 5 minutes
  • Mean Time to Response (MTTR) - < 15 minutes
  • False Positive Rate - < 5%
  • Security Event Volume - Baseline established

Compliance Standards​

  • SOC 2 Type II - Security controls audit
  • ISO 27001 - Information security management
  • PCI DSS - Payment card industry compliance
  • GDPR - Data protection regulation compliance