diff --git a/darc/key.py b/darc/key.py
index b7d49fdc6..a87b2afda 100644
--- a/darc/key.py
+++ b/darc/key.py
@@ -1,7 +1,8 @@
-from binascii import hexlify, a2b_base64, b2a_base64
+from binascii import hexlify, unhexlify, a2b_base64, b2a_base64
 from getpass import getpass
 import os
 import msgpack
+import re
 import shutil
 import tempfile
 import textwrap
@@ -135,7 +136,7 @@ class AESKeyBase(KeyBase):
 
 class PassphraseKey(AESKeyBase):
     TYPE = PASSPHRASE
-    iterations = 10000
+    iterations = 100000
 
     @classmethod
     def create(cls, repository, args):
@@ -303,6 +304,25 @@ class KeyfileKey(AESKeyBase):
 
 class KeyTestCase(unittest.TestCase):
 
+    class MockArgs(object):
+        repository = Location(tempfile.mkstemp()[1])
+
+    keyfile2_key_file = """
+        DARC KEY 0000000000000000000000000000000000000000000000000000000000000000
+        hqppdGVyYXRpb25zzgABhqCkaGFzaNoAIMyonNI+7Cjv0qHi0AOBM6bLGxACJhfgzVD2oq
+        bIS9SFqWFsZ29yaXRobaZzaGEyNTakc2FsdNoAINNK5qqJc1JWSUjACwFEWGTdM7Nd0a5l
+        1uBGPEb+9XM9p3ZlcnNpb24BpGRhdGHaANAYDT5yfPpU099oBJwMomsxouKyx/OG4QIXK2
+        hQCG2L2L/9PUu4WIuKvGrsXoP7syemujNfcZws5jLp2UPva4PkQhQsrF1RYDEMLh2eF9Ol
+        rwtkThq1tnh7KjWMG9Ijt7/aoQtq0zDYP/xaFF8XXSJxiyP5zjH5+spB6RL0oQHvbsliSh
+        /cXJq7jrqmrJ1phd6dg4SHAM/i+hubadZoS6m25OQzYAW09wZD/phG8OVa698Z5ed3HTaT
+        SmrtgJL3EoOKgUI9d6BLE4dJdBqntifo""".strip()
+
+    keyfile2_cdata = unhexlify(re.sub('\W', '', """
+        0055f161493fcfc16276e8c31493c4641e1eb19a79d0326fad0291e5a9c98e5933
+        00000000000003e8d21eaf9b86c297a8cd56432e1915bb
+        """))
+    keyfile2_id = unhexlify('c3fbf14bc001ebcc3cd86e696c13482ed071740927cd7cbe1b01b4bfcee49314')
+
     def setUp(self):
         self.tmppath = tempfile.mkdtemp()
         os.environ['DARC_KEYS_DIR'] = self.tmppath
@@ -315,7 +335,7 @@ class KeyTestCase(unittest.TestCase):
             orig = '/some/place'
 
         _location = _Location()
-        id = b'\0' * 32
+        id = bytes(32)
 
     def setUp(self):
         self.tmpdir = tempfile.mkdtemp()
@@ -331,10 +351,8 @@ class KeyTestCase(unittest.TestCase):
         self.assertEqual(data, key.decrypt(key.id_hash(data), key.encrypt(data)))
 
     def test_keyfile(self):
-        class MockArgs(object):
-            repository = Location(tempfile.mkstemp()[1])
         os.environ['DARC_PASSPHRASE'] = 'test'
-        key = KeyfileKey.create(self.MockRepository(), MockArgs())
+        key = KeyfileKey.create(self.MockRepository(), self.MockArgs())
         self.assertEqual(bytes_to_long(key.enc_cipher.iv, 8), 0)
         manifest = key.encrypt(b'')
         iv = key.extract_iv(manifest)
@@ -346,14 +364,21 @@ class KeyTestCase(unittest.TestCase):
         data = b'foo'
         self.assertEqual(data, key2.decrypt(key.id_hash(data), key.encrypt(data)))
 
+    def test_keyfile2(self):
+        with open(os.path.join(os.environ['DARC_KEYS_DIR'], 'keyfile'), 'w') as fd:
+            fd.write(self.keyfile2_key_file)
+        os.environ['DARC_PASSPHRASE'] = 'passphrase'
+        key = KeyfileKey.detect(self.MockRepository(), self.keyfile2_cdata)
+        self.assertEqual(key.decrypt(self.keyfile2_id, self.keyfile2_cdata), b'payload')
+
     def test_passphrase(self):
         os.environ['DARC_PASSPHRASE'] = 'test'
         key = PassphraseKey.create(self.MockRepository(), None)
         self.assertEqual(bytes_to_long(key.enc_cipher.iv, 8), 0)
-        self.assertEqual(hexlify(key.id_key), b'f28e915da78a972786da47fee6c4bd2960a421b9bdbdb35a7942eb82552e9a72')
-        self.assertEqual(hexlify(key.enc_hmac_key), b'169c6082f209e524ea97e2c75318936f6e93c101b9345942a95491e9ae1738ca')
-        self.assertEqual(hexlify(key.enc_key), b'c05dd423843d4dd32a52e4dc07bb11acabe215917fc5cf3a3df6c92b47af79ba')
-        self.assertEqual(key.chunk_seed, -324662077)
+        self.assertEqual(hexlify(key.id_key), b'793b0717f9d8fb01c751a487e9b827897ceea62409870600013fbc6b4d8d7ca6')
+        self.assertEqual(hexlify(key.enc_hmac_key), b'b885a05d329a086627412a6142aaeb9f6c54ab7950f996dd65587251f6bc0901')
+        self.assertEqual(hexlify(key.enc_key), b'2ff3654c6daf7381dbbe718d2b20b4f1ea1e34caa6cc65f6bb3ac376b93fed2a')
+        self.assertEqual(key.chunk_seed, -775740477)
         manifest = key.encrypt(b'')
         iv = key.extract_iv(manifest)
         key2 = PassphraseKey.detect(self.MockRepository(), manifest)
@@ -363,7 +388,7 @@ class KeyTestCase(unittest.TestCase):
         self.assertEqual(key.enc_key, key2.enc_key)
         self.assertEqual(key.chunk_seed, key2.chunk_seed)
         data = b'foo'
-        self.assertEqual(hexlify(key.id_hash(data)), b'016c27cd40dc8e84f196f3b43a9424e8472897e09f6935d0d3a82fb41664bad7')
+        self.assertEqual(hexlify(key.id_hash(data)), b'818217cf07d37efad3860766dcdf1d21e401650fed2d76ed1d797d3aae925990')
         self.assertEqual(data, key2.decrypt(key2.id_hash(data), key.encrypt(data)))