It’s always a pain to memorize a password. This is why we so often choose weak ones. A technique used for protecting bitcoin wallets (called a “brain wallet”) seemed to offer a workaround. You use a strong form of cryptography to convert a password that you only keep in your mind—thus reducing vulnerability to malware and other attacks—into something that resists brute force. Encrypted brain wallets could thus be stored in the clear in the bitcoin blockchain, making them always available to an owner without weaknesses that would expose their value to others.
Think again, brainiac! A group of researchers looked into many current brain-wallet implementations and found nothing but moths. Many brain wallets have been pilfered of their value, some within minutes of being added to the blockchain, due to a poor choice of the passwords used to seed more complicated ones.
The blockchain is a public record of all bitcoin transactions, and sites and systems increasingly use transactions to include other information. The blockchain can’t be tampered with after about an hour or so following a transaction being baked in, which makes it a perfect permanent repository. It’s also widely replicated around the globe.