diff --git a/build.gradle b/build.gradle
index 413d147..b7446c7 100644
--- a/build.gradle
+++ b/build.gradle
@@ -59,7 +59,7 @@ dependencies {
   testCompile(files("../jcardsim/jcardsim-3.0.5-SNAPSHOT.jar"))
   testCompile('org.web3j:core:2.3.1')
   testCompile('org.bitcoinj:bitcoinj-core:0.14.5')
-  testCompile('com.github.status-im.status-keycard-java:desktop:15a61e1')
+  testCompile('com.github.status-im.status-keycard-java:desktop:3.1.2')
   testCompile('org.bouncycastle:bcprov-jdk15on:1.65')
   testCompile("org.junit.jupiter:junit-jupiter-api:5.1.1")
   testRuntime("org.junit.jupiter:junit-jupiter-engine:5.1.1")
diff --git a/buildSrc/build.gradle b/buildSrc/build.gradle
index 44786a5..3e21886 100644
--- a/buildSrc/build.gradle
+++ b/buildSrc/build.gradle
@@ -4,5 +4,5 @@ repositories {
 }
 
 dependencies {
-  compile 'com.github.status-im.status-keycard-java:desktop:15a61e1'
+  compile 'com.github.status-im.status-keycard-java:desktop:3.1.2'
 }
\ No newline at end of file
diff --git a/src/main/java/im/status/keycard/KeycardApplet.java b/src/main/java/im/status/keycard/KeycardApplet.java
index aee521e..798e403 100644
--- a/src/main/java/im/status/keycard/KeycardApplet.java
+++ b/src/main/java/im/status/keycard/KeycardApplet.java
@@ -13,6 +13,7 @@ public class KeycardApplet extends Applet {
 
   static final byte INS_GET_STATUS = (byte) 0xF2;
   static final byte INS_INIT = (byte) 0xFE;
+  static final byte INS_FACTORY_RESET = (byte) 0xFD;
   static final byte INS_VERIFY_PIN = (byte) 0x20;
   static final byte INS_CHANGE_PIN = (byte) 0x21;
   static final byte INS_UNBLOCK_PIN = (byte) 0x22;
@@ -85,6 +86,9 @@ public class KeycardApplet extends Applet {
   static final byte STORE_DATA_P1_NDEF = 0x01;
   static final byte STORE_DATA_P1_CASH = 0x02;
 
+  static final byte FACTORY_RESET_P1_MAGIC = (byte) 0xAA;
+  static final byte FACTORY_RESET_P2_MAGIC = 0x55;
+
   static final byte TLV_SIGNATURE_TEMPLATE = (byte) 0xA0;
 
   static final byte TLV_KEY_TEMPLATE = (byte) 0xA1;
@@ -105,8 +109,9 @@ public class KeycardApplet extends Applet {
   static final byte CAPABILITY_KEY_MANAGEMENT = (byte) 0x02;
   static final byte CAPABILITY_CREDENTIALS_MANAGEMENT = (byte) 0x04;
   static final byte CAPABILITY_NDEF = (byte) 0x08;
+  static final byte CAPABILITY_FACTORY_RESET = (byte) 0x10;
 
-  static final byte APPLICATION_CAPABILITIES = (byte)(CAPABILITY_SECURE_CHANNEL | CAPABILITY_KEY_MANAGEMENT | CAPABILITY_CREDENTIALS_MANAGEMENT | CAPABILITY_NDEF);
+  static final byte APPLICATION_CAPABILITIES = (byte)(CAPABILITY_SECURE_CHANNEL | CAPABILITY_KEY_MANAGEMENT | CAPABILITY_CREDENTIALS_MANAGEMENT | CAPABILITY_NDEF | CAPABILITY_FACTORY_RESET);
 
   static final byte[] EIP_1581_PREFIX = { (byte) 0x80, 0x00, 0x00, 0x2B, (byte) 0x80, 0x00, 0x00, 0x3C, (byte) 0x80, 0x00, 0x06, 0x2D};
 
@@ -282,6 +287,9 @@ public void process(APDU apdu) throws ISOException {
         case INS_STORE_DATA:
           storeData(apdu);
           break;
+        case INS_FACTORY_RESET:
+          factoryReset(apdu);
+          return;          
         default:
           ISOException.throwIt(ISO7816.SW_INS_NOT_SUPPORTED);
           break;
@@ -1008,6 +1016,26 @@ private short logicrShift(short v, short amount) {
     return (short) ((short)((short) 0x4000 >>> (short) (amount - 1)) | tmp);
   }
 
+  /**
+   * Clear all keys and erases the key UID.
+   */
+  private void clearKeys() {
+    keyPathLen = 0;
+    pinlessPathLen = 0;
+    tmpPathLen = 0;
+    isExtended = false;
+    masterPrivate.clearKey();
+    masterPublic.clearKey();
+    resetCurveParameters();
+    Util.arrayFillNonAtomic(masterChainCode, (short) 0, (short) masterChainCode.length, (byte) 0);
+    Util.arrayFillNonAtomic(altChainCode, (short) 0, (short) altChainCode.length, (byte) 0);
+    Util.arrayFillNonAtomic(keyPath, (short) 0, (short) keyPath.length, (byte) 0);
+    Util.arrayFillNonAtomic(pinlessPath, (short) 0, (short) pinlessPath.length, (byte) 0);
+    Util.arrayFillNonAtomic(tmpPath, (short) 0, (short) tmpPath.length, (byte) 0);
+    Util.arrayFillNonAtomic(derivationOutput, (short) 0, (short) derivationOutput.length, (byte) 0);
+    Util.arrayFillNonAtomic(keyUID, (short) 0, (short) keyUID.length, (byte) 0);
+  }
+
   /**
    * Processes the REMOVE KEY command. Removes the master key and all derived keys. Secure Channel and PIN
    * authentication are required.
@@ -1022,16 +1050,28 @@ private void removeKey(APDU apdu) {
       ISOException.throwIt(ISO7816.SW_CONDITIONS_NOT_SATISFIED);
     }
 
-    keyPathLen = 0;
-    pinlessPathLen = 0;
-    isExtended = false;
-    masterPrivate.clearKey();
-    masterPublic.clearKey();
-    resetCurveParameters();
-    Util.arrayFillNonAtomic(masterChainCode, (short) 0, (short) masterChainCode.length, (byte) 0);
-    Util.arrayFillNonAtomic(altChainCode, (short) 0, (short) altChainCode.length, (byte) 0);
-    Util.arrayFillNonAtomic(keyPath, (short) 0, (short) keyPath.length, (byte) 0);
-    Util.arrayFillNonAtomic(pinlessPath, (short) 0, (short) pinlessPath.length, (byte) 0);
+    clearKeys();
+  }
+
+  private void factoryReset(APDU apdu) {
+    byte[] apduBuffer = apdu.getBuffer();
+
+    if ((apduBuffer[OFFSET_P1] != FACTORY_RESET_P1_MAGIC) || (apduBuffer[ISO7816.OFFSET_P2] != FACTORY_RESET_P2_MAGIC)) {
+      ISOException.throwIt(ISO7816.SW_INCORRECT_P1P2);
+    }
+
+    clearKeys();
+    pin = null;
+    mainPIN = null;
+    altPIN = null;
+    puk = null;
+    secureChannel = null;
+    crypto.random.generateData(uid, (short) 0, UID_LENGTH);
+    Util.arrayFillNonAtomic(data, (short) 0, (short) data.length, (byte) 0);
+
+    if (JCSystem.isObjectDeletionSupported()) {
+      JCSystem.requestObjectDeletion();
+    }
   }
 
   /**
diff --git a/src/test/java/im/status/keycard/KeycardTest.java b/src/test/java/im/status/keycard/KeycardTest.java
index 9759318..2e2a84e 100644
--- a/src/test/java/im/status/keycard/KeycardTest.java
+++ b/src/test/java/im/status/keycard/KeycardTest.java
@@ -128,6 +128,10 @@ private static void initCapabilities(ApplicationInfo info) {
       capabilities.add("ndef");
     }
 
+    if (info.hasFactoryResetCapability()) {
+      capabilities.add("factoryReset");
+    }
+
     CapabilityCondition.availableCapabilities = capabilities;
   }
 
@@ -210,6 +214,11 @@ public void onDisconnected() {
     usbManager.start();
   }
 
+  private static void initCard(KeycardCommandSet cmdSet) throws Exception {
+    assertEquals(0x9000, cmdSet.init("000000", "024680", "012345678901", sharedSecret, (byte) 3, (byte) 5).getSw());
+    cmdSet.select().checkOK();
+  }
+
   private static void initIfNeeded() throws Exception {
     KeyPair identKeyPair = Certificate.generateIdentKeyPair();
     Certificate cert = Certificate.createCertificate(caKeyPair, identKeyPair);
@@ -225,8 +234,7 @@ private static void initIfNeeded() throws Exception {
     sharedSecret = cmdSet.pairingPasswordToSecret(System.getProperty("im.status.keycard.test.pairing", "KeycardDefaultPairing"));
 
     if (!cmdSet.getApplicationInfo().isInitializedCard()) {
-      assertEquals(0x9000, cmdSet.init("000000", "024680", "012345678901", sharedSecret, (byte) 3, (byte) 5).getSw());
-      cmdSet.select().checkOK();
+      initCard(cmdSet);
       initCapabilities(cmdSet.getApplicationInfo());
     }
   }
@@ -932,6 +940,46 @@ void removeKeyTest() throws Exception {
     assertEquals(0, info.getKeyUID().length);
   }
 
+  @Test
+  @DisplayName("FACTORY RESET command")
+  @Capabilities("factoryReset")
+  void factoryResetTest() throws Exception {
+    KeyPairGenerator g = keypairGenerator();
+    KeyPair keyPair = g.generateKeyPair();
+    
+    // Invalid P1 P2
+    APDUResponse response = sdkChannel.send(new APDUCommand(0x80, KeycardApplet.INS_FACTORY_RESET, 0, 0, new byte[0]));
+    assertEquals(0x6a86, response.getSw());
+
+    // Good case
+    response = cmdSet.factoryReset();
+    assertEquals(0x9000, response.getSw());
+    
+    response = cmdSet.getStatus(KeycardCommandSet.GET_STATUS_P1_KEY_PATH);
+    assertEquals(0x6d00, response.getSw());
+
+    response = cmdSet.select();
+    assertEquals(0x9000, response.getSw());
+    assertFalse(cmdSet.getApplicationInfo().isInitializedCard());
+
+    initCard(cmdSet);
+
+    response = cmdSet.select();
+    assertEquals(0x9000, response.getSw());
+
+    if (cmdSet.getApplicationInfo().hasSecureChannelCapability()) {
+      cmdSet.autoPair(sharedSecret);
+      cmdSet.autoOpenSecureChannel();
+    }
+
+    if (cmdSet.getApplicationInfo().hasCredentialsManagementCapability()) {
+      response = cmdSet.verifyPIN("000000");
+      assertEquals(0x9000, response.getSw());
+    }
+
+    assertFalse(cmdSet.getKeyInitializationStatus());
+  }
+
   @Test
   @DisplayName("GENERATE KEY command")
   @Capabilities("keyManagement")