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Figure 4-12. Extending a parent public key to create a child public key Hardened child key derivation The ability to derive a branch of public keys from an extended public key is very useful, but it comes with a potential risk. Access to an extended public key does not give access to child private keys. However, because the extended public key contains the chain code, if a child private key is known, or somehow leaked, it can be used with the chain code to derive all the other child private keys. A single leaked child private key, together with a parent chain code, reveals all the private keys of all the children. Worse, the child private key together with a parent chain code can be used to deduce the parent private key. To counter this risk, HD wallets use an alternative derivation function called hardened derivation, which “breaks” the relationship between parent public key and child chain code. The hardened derivation function uses the parent private key to derive the child chain code, instead of the parent public key. This creates a “firewall” in the parent/child sequence, with a chain code that cannot be used to compromise a parent or sibling private key. The hardened derivation function looks almost identical to the normal child private key derivation, except that the parent private key is used as input to the hash function, instead of the parent public key, as shown in the diagram below: 94 | Chapter 4: Keys, Addresses, WalletsPDF Image | Mastering Bitcoin
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