What Is a Bitcoin Paper Wallet?
There are various types of wallets which holders can use to keep their Bitcoin, but cold wallets are considered to be the most secure options. A cold storage wallet is a paper wallet, which is a physical paper on which the private keys to your BTC are printed. This storage option is considered ideal for storing large amounts of coins since it is secured against online hacks, but if you have small amounts or trade often, choose an alternative wallet.
How a Bitcoin Paper Wallet Works
A Bitcoin paper wallet results from a process which involves printing your private keys on a piece of paper. Instead of keeping your private keys on your computer or other devices connected to the internet, directly storing keys in physical form eliminates the risk of online hacks.
Cold storage is the best way of keeping your Bitcoins safe as it cannot be touched by hackers, scammers, and other threats from the online environment.
The only major disadvantage here is that there is no way to back up your wallet in case it is stolen or damaged.
Types of Paper Wallets
There are two types of paper wallets. Both provide secure online storage, but one method has an extra layer of security, as it protects you if your computer has been infected with malware prior to the process of creating the wallet.
– Non-Secure Paper Wallets
A non-secure wallet is a paper wallet created while the computer from which you are printing the keys is still connected to the internet. This means that during the printing process, someone might still gain access to what is happening on your screen.
There are several platforms which facilitate the creation of non- secure wallets such as BitAddress.
- After accessing the BitAddress page, you will be asked to move your cursor until a new key is generated.
- Next, select the “create a private key” option from the menu.
- Then click on the paper wallet option.
- Print the paper wallet.
A 3D barcode is also available and it enables the user to perform Bitcoin transfers directly to and from their newly created paper wallet. The process of creating a wallet is simple, but it doesn’t feature many security measures which you can take if your computer was already infected. There are numerous types of malware that can monitor your activity on your computer.
There is also the risk of someone hacking BitAddress’s servers, which can give them access to all the private keys created using the site’s services.
– Secure Bitcoin Paper Wallet
A secure paper wallet eliminates all the risks mentioned at the previous wallet type and can be created in nearly an hour. It also requires a 4-gigabit flash drive.
How to create a Secure Paper Wallet
1. Download The Necessary Software
The first thing you have to do is disconnect your computer form the internet and install a new operating system, which has the offline version of BitAddress installed on it.
You will have to download the following software before starting this procedure:
- LiLi (Linux Live USB creator)
First, open the LiLi USB creator. Then, insert your flash drive and select “ISOIMG/ZIP”. Choose the Ubuntu ISO file which you previously downloaded. You will be required to format your flash drive in FAT32. Select only FAT32 and click on the lightning bolt icon. After Ubuntu was formatted on your flash drive, unzip the BitAddress Offline file to your USB.
2. Disable all Online Connections
Next disable all online connection: Wi-Fi, cellular, and Bluetooth. You can also unplug your modem and router to be sure everything is disconnected. This will eliminate the risk of someone monitoring the generating process of your paper wallet.
3. Load Ubuntu onto your PC
Restart your PC and boot it from using the Ubuntu operating system form your flash drive. To boot, press the F1 or F12 keys when your PC restarts. A screen showing your boot options will appear. Select the option which features your flash drive. Now load the Ubuntu system on your PC.
4. Install Printer
Now we will be moving on to installing the printer on your Ubuntu- operated PC. Enter the system’s settings options and scroll down to printers and select this option. You will then be asked to add a printer. Follow the on-screen directions provided to install the printer. Print out a test page to see if everything is functional.
5. Open Offline BitAddress
Using the Firefox browser, you will then have to open a private browsing window. In the address bar, paste the following: file://cdrom/bitaddress.org-master/. Then click on the provided link by “BitAddress.org.html”. You will be asked to move your cursor on the screen until 0 is featured in the top right of the screen.
6. Print the Paper Wallet
A new wallet address will be generated to you and can now print your Bitcoin paper wallet. Choose “paper wallet” from the options menu and execute the printing instructions.
7. Loading Your Bitcoin Paper Wallet
The created paper wallet will feature on the left side your public address. You can use this address to load your paper wallet without risking the online exposure of your funds. The paper will have on its right side a spend 3D barcode, which allows you to directly send Bitcoin in a secure fashion.
Taking all the precautionary measures to keep your Bitcoin safe is a step which should be practiced by all investors. Now that you have the means and knowledge to create your own secure paper wallet, you can begin safely storing your BTC.