One of the most secure and popular ways of. the storage of crypto assets is by using the paper wallet. The private and public keys can be printed on a piece of paper. Most cryptocurrencies Ethereum, Ripple and Litecoin can be stored in paper form.
Bitcoin Paper Wallet and the need for the Bitcoin Paper Wallet
The public key is your public wallet address and through this Bitcoins can be sent to you from any part of the world. With the private key Bitcoins can be sent from your wallet to other individuals. With the combination of private keys and public keys, a safe cryptocurrency transaction can be carried out between people.
It is important to note that your private Bitcoin wallet key should only be known to you. You could lose all your money if someone is aware of your private key. Thus for the purpose of safety, the private key should never be disclosed. Disclosing a private key is equivalent to giving your credit information to someone else. Users keeping their crypto assets in online wallets or hard drive wallets like USBs are at a consistent risk of keyloggers, viruses and hackers who can potentially steal all their cryptocurrencies. This can lead to the users losing their crypto assets in one go.
How to Create a New Paper Wallet?
- The first step for creating a physical Bitcoin Paper wallet is by the generation of a unique Bitcoin address, by visiting bitaddress.org. The website generates a key for you. In order to have additional protection, users can complicate their address by following the relevant instructions given on bitaddress.org. Move your cursor till randomness is 100%.
- After completing the process, the user can access public keys and private keys as well as their QR codes. After this, the “Paper Wallet” tab should be clicked. The users can thus select the number of addresses that they would like to generate. Once the addresses are selected, users can hit the “Generate” button to make new Bitcoin wallets. As Bitaddress generates the new wallet, users can click “Print” to create hard copies of their wallet address. A printer of your choice can be selected from the web browser. Browsers like Google Chrome allow you to save your wallet address as a PDF file for printing.
Bitcoin paper wallet allows the creation of tamper-resistant designs for their paper bitcoin wallets. Holographic labelling can also be used to show the wallet is tamper-free.
How to Secure a Bitcoin Paper Wallet?
Serious precautions should be taken to ensure the security of paper Bitcoin wallets, especially if the wallets store a substantial amount of crypto assets.
- Ensure nobody sees you creating your paper wallet. Hackers or unwanted viewers can copy all your keys and steal your funds. LiteAddress and BitAddress provide two-factor authentication which provides for greater improved overall wallet security.
- It is important to ensure that a virus and malware free operating free is used to prevent the attack of hackers and keyloggers. For example. Ubuntu is recommended for a virus and malware free experience.
- The website should be able to run offline once the paper wallet has been created. Before generating the public and private key, disable your internet connection.
- The paper wallet can be printed from a printer which is not connected to any network for enhanced security.
- The paper wallet can be stored in a sealed compartment to prevent damage to the wallet. The wallets can also be laminated.
- Paper wallets can be encrypted with BIP 38 as these wallets require a password before funds can be spent. Decrypting BIP 38 keys requires a lot of computational power, thus decreasing the effectiveness of brute-force attempts and thus improving security.
How to export Private keys from Altcoin wallets to a Bitcoin Paper Wallet?
Every altcoin wallet carries a variation of BTC-QT wallet application. Visit the site which was used to create your paper wallet and check if there is a “Receive” tab that can be clicked. Select the address you want with your mouse and copy it to your computer’s clipboard. Click on the “ Help” menu button and select” Debug”. Once the console tab opens, enter <<dumpprivkey>> and paste your wallet address over.
After completing the steps, the console displays the private key associated with the wallet. Thus there is no need to access private and public keys of the wallet. Users can print the codes or generate QR codes for printing. The “wallet.dat” file should be deleted from the computer after the process is completed.
A common misconception with Bitcoin beginners is that their wallet is always connected to the Bitcoin network where they take part in transactions. This stems from a non-technical person’s lack of knowledge of computer networking, but it can be resolved with paper wallets. Paper wallets are low-tech which help newcomers differentiate their wallets from the network. It helps beginners accept the fact that their wallets are their own and are not owned by another party. When making their first transaction, they learn that the network is only relevant for sending and receiving money, not storing it.
Paper wallets may seem less secure at first. However, paper wallets put the responsibility for security in the hands of the owner. Imagine if a popular exchange gets hacked. As the exchange stores the wallets of millions of users, there is a huge possibility that those people could lose all of their crypto assets as they trusted another party.
Many would say that this threat could be prevented by using hardware wallets, but the common user is still not certain of their private keys. A non-technical user of Bitcoin cannot simply read the open source software of which these wallets are made. Consequently, they are not certain whether their keys are stored or transported in a secure manner. With increased benefits for newcomers as well as long-term asset holders, paper wallets are a feasible option for a newbie as well as an established player.
