VU#701544: mpc-lib Hardened Derivation Fails to Protect Ancestor Isolation

Overview Fireblocks' mpc-lib library contains a cryptographic fail-open vulnerability in its BIP32 hardened derivation implementation in the case of a missing private parent key. This breaks the ancestor isolation property of hardened derivation, allowing an attacker with a compromised lower-level signer share to recover the higher-level share it was derived from. Description Fireblocks is a digital-asset custody and wallet platform that secures the private keys behind cryptocurrency wallets for institutions and exchanges, using multi-party computation (MPC) so that no single machine ever holds a complete key. Fireblocks’ key security pipeline contains two layers: MPC, which splits a single key into shares, and hardened derivation, which mathematically isolates each share from its key hierarchy. Normally, the derivation delta between parent and child keys is formed by hashing the private parent key, a derivation index, and associated metadata. CVE-2026-90975 A fail-open vulnerability was identified within the BIP32 hardened derivation implementation which fails to reject operations where no parent secret is present. If a parent key is missing, the implementation substitutes the secret parent contribution with a null buffer. Because the buffer becomes a known constant, 0, the delta becomes computable, violating ancestor isolation. Impact An attacker who compromises a single MPC party's descendant signer share, and who knows the associated chain code, can compute the public der…