With recent news of Bitcoin, Ethereum and other various cryptocurrencies making headlines on a daily basis with unfortunate news of faulty crypto security and people having their coins hacked away, it’s no wonder security has become incredibly important. One of the safest and well-known ways of keeping your cryptocurrency safe and sound is by utilizing something called a paper wallet. For this guide, we’ll go through the proper steps for you to make your own paper wallet along with a cold storage. Keep in mind that this method due include other cryptocurrencies beside Bitcoin, such as Ethereum and Litecoin.
What is a Paper Wallet?
Simply put, any crypto wallets are made up of two keys. One of these keys are public and the other is private. The public key is your public wallet address and it’s through this public address that allows others to send crypto coins to the wallets of other owners from yours. It’s the combination of both of these keys that allow a safe cryptocurrency transaction between people.
Do note that your private wallet key should only be known by you, in the same fashion as only knowing the pin number to your own credit card.
If someone else manages to get a hold of said private key, they will have the power to steal every single one of your hard earned crypto coins. Therefore, it’s best to never disclose your private key to anyone for safety sakes.
Owners who keep their cryptocurrencies in online wallets or even hard drive wallets, such as USBs, have repeatedly exposed themselves to a risk of getting hacked, getting a virus and keyloggers, potentially leading to them having their cryptocurrencies stolen, leaving them empty of any of cryptocurrency they’ve invested into over the years.
This leads to Paper wallets, which are without a doubt one of the best methods to store away any cryptocurrency. Paper wallets is an offline cold storage method for saving cryptocurrency. In order to do this, you must print out your public and private keys on a piece of paper which you later than store and save in a secure location.
They keys themselves are printed in the form of QR codes which you can scan for future transactions. The main reason why this method is so safe is due to it giving owners complete control. No need to worry about the wellbeing of a piece of hardware, nor does worrying about hackers or malware invasion need to happen. Simply ensure the piece of paper is well taken care of.
Take a look at the picture below to compare different storage options for your cryptocurrencies.
Is a paper wallet necessary?
Necessary? Possibly not but it really all comes down to how long your planning to be a part of the cryptocurrency game or if you want to be as secure as possible. If your only planning to trade a short while then most likely not, but those of you who decide to stay involved for a long time should highly consider the paper wallet method.
Creating a paper wallet
Paper wallets are developed by utilizing a program to randomly generate a public and private key. These keys are all unique, and the program generating them is open source. Those with the knowledge behind coding can check the backend of the program themselves for randomicity in results. While this may sound confusing for those of you who are not technology savvy, be assured that it’s quite simple.
Knowing how to code or encrypt is not necessary for any of these steps. The only thing you’ll need for the creation of your paper wallet is a computer, internet connection, and something to print your keys on.
First of all in order to create a physical paper wallet is to generate a unique bitcoin address. This can easily be done by going to your web browser of choice and typing in, BitAddress.org. This website is quite self-explanatory; it generates the key you need. Make sure to move your mouse around as you type in random texts into the text box in order to further complicate the encryption process being generated on your screen.
Once the process has been completed, you’ll be presented with a public and private key, as well as the QR codes for them. I will recommend for you to not scan any of this information. Owners should click on the “Paper wallet” tab provided to them, Under this tab, you can select the number of addresses that you’d like to generate. If you do not like the paper wallet artwork the site automatically generates, click the “Hide Art?” to completely do away with it. Once you’ve inputted the number of addresses is done and a decision has been made pertaining to artwork, click on the “Generate” button to make a new paper wallet.
After BitAddress has finished generating the new wallets, simply click on “Print” in order to develop a hard copy of the wallet address. You will be prompted by your browser to select the printer you’ll use for this. Some browsers may also allow you to save your wallet address through the use of pdf file for later printing if necessary.
Other possible sites to use to generate a paper wallet are WalletGenerator.net, bitcoinpaperwallet.com, and Blockchain.info if you have an account with them. They are also quite easy to do and require somewhat similar steps as above but are still really simple to generate a paper wallet with.
Owners should always take some serious precaution when securing their paper wallets, especially if said wallet is holding a substantial amount of cryptocurrency assets. Scams and thefts are unfortunately quite common in the cryptocurrency community, that’s why you should always keep an eye out for anything shady and stay safe at all times.
Here are some tips that may help you remain safe when handling a paper wallet.
Make sure that nobody has a view of you developing your paper wallet. Anyone spying on you may be able to copy all of the keys and steal your funds, leaving you confused as to how your funds disappeared.
Bitaddress does allow the owner to enable a two-factor authentication, providing for greatly improved overall wallet security. To avoid any possible risk of contracting malware or keyloggers that could search through your activities, users should use a virus-free and clean operation system, possibly even a new computer if affordable.
Once you’ve developed and set up your paper wallet from your preferred website, the website code should be able to run while offline.
To further secure your privacy, disable your internet connection before generating public and private keys. If you wish to add even more layer of protection, you could print the paper wallet form a printer that isn’t connected to any network.
It’s advised to store your paper wallet into a sealed compartment of some sort to avoid getting the paper wallet damaged by water and other residues. Having them laminated will ensure your paper wallet is protected from the worse possible elements. Safes can further add to the security and reduce the risk of someone from physically stealing the wallet.
While not as common, some people have entrusted their paper with their solicitor or someone who they may trust with their will, testament and other such important documents. Storing them in deposit boxes is also another viable option to do.
Keep in mind that it is possible to print out multiple forms and keep them saved away in multiple locations can be very beneficial for you.
Risk of loss
While paper wallets substantially decrease the possible threats of having your cryptocurrency stolen through the internet, they aren’t without their own set of risk.
Since it’s been written down on a piece of paper, anyone who can read or has taken a picture of it can easily steal your crypto coin. The paper itself is quite delicate and can easily be damaged or wear down over time. Making backups is very important for such cases.
Natural disasters such as house fires, hurricanes, floods, and other such things can lead you to lose your paper wallet. That’s why it’s important to secure it in multiple places besides your own home to ensure if the worst does happen, you’ll be able to access it somewhere else, such as a deposit box.
Printers are another issue if you don’t have a quality printer it could cause the QR code to come out wrong and lead to error issues in the future. Try using a laser printer to decrease the chance of having a runny paper. And lastly, make sure to handle your paper wallet carefully, you don’t want to accidentally tear it or even worse forget where you left them.
Setting up a paper wallet is a very straightforward process to perform and easy enough for the less technology-minded people to deal with. If you’ve followed the process closely then you should now be a proud owner of your very own paper wallet.
Remember that it’s your own responsibility to ensure your crypto investments are safe and no one else’s.
Too many people have lost their crypto coins over the years due to people either not carefully securing themselves, handing over their information freely, or not being vigilant of scam-artists. Always be careful with your crypto coins and ensure to stay up to date with the latest security available.
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