diff --git a/APPLICATION.MD b/APPLICATION.MD
index 3026235..9266e7b 100644
--- a/APPLICATION.MD
+++ b/APPLICATION.MD
@@ -439,7 +439,9 @@ private key (P2=0x00) can be exported if and only if the requested key path is i
 
 The P1 parameter indicates how to the derive the desired key. P1 = 0x00 indicates that the current key must be exported,
 and no derivation will be performed. P1 = 0x01 derives the path given in the data field without changing the current
-path of the card. P1 = 0x02 derives the path but also changes the current path of the card.
+path of the card. P1 = 0x02 derives the path but also changes the current path of the card. The source for derivation
+can be set by OR'ing P1 with the constants defined in the DERIVE KEY command. This allows deriving from master, parent
+or current.
 
 If the private key is being exported, the card could omit exporting the public key for performance reason. The public
 key can then be calculate off-card if needed.
\ No newline at end of file
diff --git a/build.gradle b/build.gradle
index 8d6915e..4cc12b1 100644
--- a/build.gradle
+++ b/build.gradle
@@ -42,7 +42,7 @@ dependencies {
   testCompile('org.web3j:core:2.3.1')
   testCompile('org.bitcoinj:bitcoinj-core:0.14.5')
   testCompile("org.bouncycastle:bcprov-jdk15on:1.58")
-  testCompile("com.github.status-im:hardwallet-lite-sdk:75d9f54")
+  testCompile("com.github.status-im:hardwallet-lite-sdk:482e32c")
   testCompile("org.junit.jupiter:junit-jupiter-api:5.1.1")
   testRuntime("org.junit.jupiter:junit-jupiter-engine:5.1.1")
 }
diff --git a/src/main/java/im/status/wallet/WalletApplet.java b/src/main/java/im/status/wallet/WalletApplet.java
index b755805..9d15ace 100644
--- a/src/main/java/im/status/wallet/WalletApplet.java
+++ b/src/main/java/im/status/wallet/WalletApplet.java
@@ -52,6 +52,7 @@ public class WalletApplet extends Applet {
   static final byte DERIVE_P1_SOURCE_MASTER = (byte) 0x00;
   static final byte DERIVE_P1_SOURCE_PARENT = (byte) 0x40;
   static final byte DERIVE_P1_SOURCE_CURRENT = (byte) 0x80;
+  static final byte DERIVE_P1_SOURCE_MASK = (byte) 0xC0;
 
   static final byte GENERATE_MNEMONIC_P1_CS_MIN = 4;
   static final byte GENERATE_MNEMONIC_P1_CS_MAX = 8;
@@ -1233,25 +1234,26 @@ public class WalletApplet extends Applet {
         return;
     }
 
-    byte[] exportPath;
-    short exportPathOff;
-    short exportPathLen;
+    byte[] exportPath = keyPath;
+    short exportPathOff = (short) 0;
+    short exportPathLen = keyPathLen;
+
     boolean derive = false;
     boolean makeCurrent = false;
+    byte derivationSource = (byte) (apduBuffer[ISO7816.OFFSET_P1] & DERIVE_P1_SOURCE_MASK);
 
-    switch (apduBuffer[ISO7816.OFFSET_P1]) {
+    switch ((byte) (apduBuffer[ISO7816.OFFSET_P1] & ~DERIVE_P1_SOURCE_MASK)) {
       case EXPORT_KEY_P1_CURRENT:
-        exportPath = keyPath;
-        exportPathOff = (short) 0;
-        exportPathLen = keyPathLen;
         break;
       case EXPORT_KEY_P1_DERIVE_AND_MAKE_CURRENT:
         makeCurrent = true;
       case EXPORT_KEY_P1_DERIVE:
         derive = true;
-        exportPath = apduBuffer;
-        exportPathOff = ISO7816.OFFSET_CDATA;
-        exportPathLen = dataLen;
+        if (derivationSource == DERIVE_P1_SOURCE_MASTER) {
+          exportPath = apduBuffer;
+          exportPathOff = ISO7816.OFFSET_CDATA;
+          exportPathLen = dataLen;
+        }
         break;
       default:
         ISOException.throwIt(ISO7816.SW_INCORRECT_P1P2);
@@ -1263,7 +1265,7 @@ public class WalletApplet extends Applet {
     }
 
     if (derive) {
-      doDerive(apduBuffer, dataLen, DERIVE_P1_SOURCE_MASTER, makeCurrent);
+      doDerive(apduBuffer, dataLen, derivationSource, makeCurrent);
     }
 
     short off = SecureChannel.SC_OUT_OFFSET;
diff --git a/src/test/java/im/status/wallet/WalletAppletTest.java b/src/test/java/im/status/wallet/WalletAppletTest.java
index 53f2e72..3c3bae6 100644
--- a/src/test/java/im/status/wallet/WalletAppletTest.java
+++ b/src/test/java/im/status/wallet/WalletAppletTest.java
@@ -981,13 +981,13 @@ public class WalletAppletTest {
     verifyExportedKey(keyTemplate, keyPair, chainCode, new int[] { 0x8000002b, 0x8000003c, 0x8000062d, 0x00000000 }, true, false);
 
     // Derive & Make current
-    response = cmdSet.exportKey(new byte[] {(byte) 0x80, 0x00, 0x00, 0x2B, (byte) 0x80, 0x00, 0x00, 0x3C, (byte) 0x80, 0x00, 0x06, 0x2D, (byte) 0x00, 0x00, 0x00, 0x00, (byte) 0x00, 0x00, 0x00, 0x00}, true,false);
+    response = cmdSet.exportKey(new byte[] {(byte) 0x80, 0x00, 0x00, 0x2B, (byte) 0x80, 0x00, 0x00, 0x3C, (byte) 0x80, 0x00, 0x06, 0x2D, (byte) 0x00, 0x00, 0x00, 0x00, (byte) 0x00, 0x00, 0x00, 0x00}, WalletApplet.DERIVE_P1_SOURCE_MASTER,true,false);
     assertEquals(0x9000, response.getSW());
     keyTemplate = response.getData();
     verifyExportedKey(keyTemplate, keyPair, chainCode, new int[] { 0x8000002b, 0x8000003c, 0x8000062d, 0x00000000, 0x00000000 }, false, false);
 
     // Derive without making current
-    response = cmdSet.exportKey(new byte[] {(byte) 0x80, 0x00, 0x00, 0x2B, (byte) 0x80, 0x00, 0x00, 0x3C, (byte) 0x80, 0x00, 0x06, 0x2D, (byte) 0x00, 0x00, 0x00, 0x00, (byte) 0x00, 0x00, 0x00, 0x01}, false,false);
+    response = cmdSet.exportKey(new byte[] {(byte) 0x00, 0x00, 0x00, 0x01}, WalletApplet.DERIVE_P1_SOURCE_PARENT, false,false);
     assertEquals(0x9000, response.getSW());
     keyTemplate = response.getData();
     verifyExportedKey(keyTemplate, keyPair, chainCode, new int[] { 0x8000002b, 0x8000003c, 0x8000062d, 0x00000000, 0x00000001 }, false, true);
@@ -1002,7 +1002,7 @@ public class WalletAppletTest {
     verifyExportedKey(keyTemplate, keyPair, chainCode, new int[] { 0x8000002b, 0x8000003c, 0x8000062d, 0x00000000, 0x00000000 }, false, false);
 
     // Reset
-    response = cmdSet.deriveKey(new byte[] {}, WalletApplet.DERIVE_P1_SOURCE_MASTER);
+    response = cmdSet.deriveKey(new byte[0], WalletApplet.DERIVE_P1_SOURCE_MASTER);
     assertEquals(0x9000, response.getSW());
   }