If you hear the phrase “paper crypto wallet” it’s talking about a private key or seed phrase on paper, and it might be one of the best ways to keep your crypto safe.
- What are paper crypto wallets or bitcoin paper wallets?
- The Easy Way to Make a Paper Wallet
- Why isn’t this approach deemed to be secure?
- How To Keep Your Paper Bitcoin Wallet Safe
What are paper crypto wallets or bitcoin paper wallets?
A seed phrase, also referred to as a private key is effectively the combination lock on a Bitcoin paper wallet. As such, you cannot afford for it to fall into the hands of someone else, because then they can open up your bitcoin paper wallet as if by magic and make off your cash. You can’t afford to commit it to memory because it’s not a word or phrase that you can remember. It’s just a load of characters that gets you back your private key. And don’t put it anywhere that is hackable via a network like a hot wallet. That’s part of the appeal of paper crypto wallets. They’re just not hackable!
If you keep your cryptocurrency on a bitcoin paper wallet you are only able to load funds to it. To move them anywhere else you will need to put the paper crypto wallets private key into a software wallet. This is how you get at your coins.
The Easy Way to Make a Paper Wallet
It’s easy to make a paper bitcoin wallet, but remember, you can’t afford to lose it! Here’s a simple way to set one up:
- Visit BitAddress (open source program to make paper wallets).
- Type something in or play with the mouse to help randomly create a private key.
- Next, select “Paper Wallet” and print the results out. You can now store your Bitcoins via the public address on the left.
- Next you check the BIP38 encryption box to get a passphrase. This adds encryption to the paper bitcoin wallet to make it safer.
Half a minute is all it takes, and you’re done! You can create however many unique addresses you want via the ‘Addresses to generate’ option.
Why isn’t this approach deemed to be secure?
Like anything that you do on a screen, somebody could be looking over your shoulder. The other thing is, if the BitAddress site was breached, all the private keys could easily be harvested. And if you are a Windows user there might be malware on your system that could be watching your actions without you being aware.
How To Keep Your Paper Bitcoin Wallet Safe
When your paper wallet is all set up you can use your bitcoin address on the left to put money on to it. Don’t disclose the private key that’s on the right handside.
For greater bitcoin paper wallet safety: have it laminated so it doesn’t get tied up, torn, or faded. Put it somewhere where no one else can get at it, maybe in a safe, and if you want to really go the extra mile you can store different parts on different paper wallets, and have it set up so that you need two out of three of these partial copies to retrieve the private key. This makes it more difficult to steal because the key is held in different places. Of course, this level of extra complexity this adds means that it might potentially be more difficult to lose as well. Perhaps one copy in a bank safe-deposit box is the way to go.
Conclusion – Cold Storage is Your Best Option
If you need to store a lot of Bitcoins then cold storage is your best choice for staying safe. Crypto hardware wallet is a great choice, but a bitcoin paper wallet is too. It’s possible to make a very secure version, more secure than the one just described, although it takes about half an hour to do this. But it shouldn’t be a concern if you’re someone who is serious about bitcoin and needs to protect their cash.