Privacy is an important and complicated issue in the sphere of bitcoin trading, and many users want to protect their data and funds from hacks. That is why developers pay attention to the security of bitcoin wallets and provide private keys for them. A paper wallet is one of the types of cold storage for the private keys from a bitcoin wallet. We will tell you the main goals of the BTC paper wallets and provide a tutorial about their creation in this article.
A quick approach to create a paper wallet
If you need to generate paper wallets but do not want to know all details about private keys and paper wallets for bitcoins, you can just follow this algorithm:
- Visit the webpage of wallet generator — BitAddress;
- Receive a private key created randomly;
- Choose an option “paper wallet”;
- Select number of papers you want to print;
- Apply BIP38 encryption if you want;
- Print a paper wallet for your holdings.
We recommend that you get acquainted with the material we prepared about this type of coins cold storage because it will help you make your paper wallets and private keys even more secure.
We will introduce you to several topics connected with private keys and paper wallets:
- Description of paper wallet features
- The easiest approach to generate a paper wallet
- An advanced approach to a paper wallet creation
- Protection of paper wallets
- Import of paper wallet to an online one
Description of paper wallet features
When you register your cryptocurrency storage on any web server, you will need to create a private key for it or a seed phrase. The main thing is that you should store it offline to protect coins wallet from online fraud, but you should always have access to it. Such offline stores are also known as Cold Storage, and we discussed it earlier in another review.
You probably think that you can remember private keys for all crypto currency wallets, but it consists of a long sequence of digits and letters, so only geniuses can learn it by heart. As regards the seed phrase, it is a line of 24 words that can be helpful for you if you forget the private key.
A paper wallet is a usual piece of paper that keeps your private key or seed phrase on it to save it offline. The reason to store the private keys offline is that there is a lower probability that someone will find them than when they are located in online cryptocurrency storage.
By the way, the generation of paper wallets is not popular among BTC users who have a small amount of money on their wallets. Instead, advanced users with huge funds on their bitcoin wallets are always interested in protecting and using cold wallets. Besides, the difference between cold storage and hot storage is that the former is not connected to the Internet and your bitcoins cannot be hacked by external users. On the contrary, hot storage is the one that has access to online servers and your crypto currency can be achieved by third parties.
If you use a paper wallet on any platform, it will limit the scope of available operations with bitcoins for you. For example, you will be able to deposit money to your wallet but transferring money from your wallet will be possible only with sweeping of paper wallet.
The easiest way to generate a paper wallet
You should pay attention to the security of your paper wallet when you create it. However, if know all the consideration about the protection of paper wallet and want just to know an algorithm of its creation there is a description of this process:
- Go to special wallet software BitAddress for generation of paper wallets;
- Use your mouse to encourage the system to create random text or sequence of characters;
- Click to “Paper Wallet” to set the appropriate format of private key storage;
- Print the paper and proceed with usage of this wallet from any platform;
- Provide extra protection to your private key with BIP38 encryption.
As you can see, this operation takes no more than a minute, and the system allows you to create an infinite number of paper wallets. If you want it to generate several of them, you should put the proper number at the beginning of the creative process, and the wallet generator will construct uniques paper wallets for you.
Security of simple paper wallet
The creation of such cold storage as the paper wallet is the first step to the full protection of your funds for several reasons.
- Firstly, strangers can have access to your paper wallet because you generate it online with your computer. There are a lot of techniques that allow hackers to monitor your screen. That is why you should be more circumspect about the process of paper wallet generation.
- Secondly, the BitAddress server is not protected from hacks, and all the data from this server can get to other people. There are more safe ways to the creation of paper wallets than the usage of the simple paper wallet generator.
- Moreover, Windows-based devices are frequently exposed to malware that can get info from your computer without your permission. For these reasons, we recommend you keep reading and care more about protecting your paper wallet.
An advanced approach to a paper wallet creation
If the previous way is not sufficient for you and you want to be 100% sure that your bitcoin address and wallet will not be accessible to anyone else, you should go through a more complicated but more reliable procedure of paper wallet creation.
Required tools and equipment
Advanced ways of paper wallet generation are not similar for different wallet software. This description is suitable only for PC users, and Mac owners cannot use it.
At first, you should install several open-source programs on your device:
- Lili — service that will help you to download another program to flash storage;
- Ubuntu — main software for this operation;
- BitAddress — paper wallet generator.
Furthermore, you should have new flash storage or hard drive or format the old one for the creation of a protected paper wallet. It is better to download the latest versions of every program we listed.
1 — Store Ubuntu on a flash driver
Make sure your flash drive does not keep any important files because the installation of Ubuntu will delete everything from the storage.
- Insert the flash drive into the computer;
- Enter LiLi program that should be already installed on your device;
- Choose the driver you want to store data on in the list of available ones;
- Click on the “ISO/IMG/ZIP” option and select Ubuntu from the programs downloaded on your computer;
- Use “Format the key in FAT32” and unselect all others;
- Start the installation by clicking on the sign of lightning;
- Wait for the end of work and find your BitAddress file;
- Open ZIP file with BitAddress and move HTML file to the flash drive you use for paper wallet creation.
When you complete all these steps, you will be ready to start the process of creation itself.
2 — Proceed with offline services and check work of the printer
You should be sure that your device is not connected to the Internet either with Wi-Fi or LAN. It is a crucial step where you should stop all the connections of your computer with the network. Otherwise, there will be no point in the work we do.
Another step here is to check your printer with a text version of paper wallet because you need it to work properly.
3 — Apply Ubuntu
You should switch your computer to another operating system, and you can easily do it with several clicks on the keyboard. Restart the device and press buttons F1 or F12 when the computer makes boot-up. You will get a page where you can choose Ubuntu as the main operating system for a while. It will take some time for Ubuntu to start the working process, and after the end of the loading, you should select the option “Try Ubuntu.”
4 — Integrate your printer to Ubuntu
Ubuntu will not know what printer it should use if you do not set it in advance.
- Go to the “System Settings” page;
- Open a tab with printers;
- Add your printer;
- Try it by printing a testing piece of paper.
5 — Create a paper wallet in BitAddress
You should go to the BitAddress wallet generator and start the generation of a real paper wallet for printing.
- Use Firefox, and do not forget to switch the tab to the private window. You can do it with the right key of your mouse and the option “Open a new private window”;
- Enter an address to searching bar://cdrom/bit address.org-master/ ;
- Select the file you have downloaded — BitAddress.org.html;
- Move your mouth round and increase the number on the top until 100;
- Select the “Paper wallet” function from the menu;
- Fill in the number of paper sheets with code you need to print;
- Decide whether you want to use BIP38 encryption or not;
- Print out a paper wallet that BitAddress creates for you.
Factors that can put at risk your private key
You should control many things to avoid leakages of your data to the Internet:
- Do not allow Ubuntu to be connected to the Internet;
- Follow all the instructions we provided to save the computer from malware interference;
- Use only the offline version of the wallet generator and other open-source programs to hide your paper wallet from hackers.
- Perform malware check of your computer before doing any processes with coins
Protection of paper wallets
Once you obtain cold storage, you can do any operations with it by using the bitcoin address, which is written on the one side of the piece of paper you printed out. Do not forget to keep the opposite side of the paper wallet hidden because it includes a private key from your bitcoin wallet.
Also, you can apply the methods listed below to make sure your paper wallets with private keys will be saved for a long time:
- Put paper wallet to a safe or any other place which is accessible only for you;
- Laminate paper wallet to keep writings on it for as long as possible and save it from water damage;
- Use Cryptosteel to protect your paper wallet from disasters.
Another way of fully protecting your paper wallet is to split it into several pieces and keep all of them in different places. It helps users to be confident that even if someone finds one piece, he or she will not know the full private key.
Import of paper wallet to an online one
You can decide to withdraw bitcoins from your paper wallet, and you will need to import it into software one.
This process can be different for some types of paper wallets and your bitcoin holdings, but the main algorithm is always the same:
- Choose software wallet and install it;
- Create new wallet in downloaded software;
- Import your seed or private key to it;
- Use QR code from paper wallet to speed up the process of importing.
Make sure you create a new wallet for this process because you may lose all your bitcoins if you import a paper wallet to it. It may happen because software can think that you want to reregister the private key and bitcoin address and delete all the previous data. The best strategy is to use a new distinct software wallet for transferring all the bitcoins from the paper one. Usually, many people lose their coins because of user error. That is why users should always control all the processes that they make with their bitcoins.
Cold storage is an essential thing for users who are interested in keeping the privacy of their bitcoin. Sometimes it is not important to do this when you have a small amount of money in your wallet. However, large funds are worth it to spend more time on protecting the storage.
You can use more advanced types of cold storage such as hardware wallets or select paper wallets as a store for your private key. However, the creation of paper wallets is also not a simple process because the more time you spend on the protection of your funds, the higher will be the probability of it being secured. We recommend you use an advanced method of paper wallets creation because it will guarantee better safety for your crypto wallet. It will take no more than 30 minutes to construct a paper wallet with full protection, but it can save a lot of money for you.
How do I get a Bitcoin paper wallet?
There are two methods you can use to obtain paper wallets: simplified and advanced ones. Choose the one you prefer more, but our recommendation is to go through more steps of securing your BTC wallet address. The former method does not require from you any equipment except for internet access. The second one is special because it will exclude any chance that another person can find your private keys on the Internet.
Are Bitcoin paper wallets safe?
A paper wallet is one of the safest cold storage in this sphere today for many people with huge funds. You should remember that it keeps only a private key from your bitcoin wallets but not bitcoin cash. It means that your bitcoins will still be kept online, and some skillful hackers will be able to find them. However, it is still a method to reduce the probability of hacking your BTC addresses. If you want to make your bitcoin holdings even more protected, you can create hardware wallets.
Can paper wallets be hacked?
If you keep your paper wallet in a safe place, no one will know your private key. The only way to hack your bitcoin addresses is to hack the platform with the wallet itself. Such situations happen rarely, and there is almost no way for you to secure a platform from breaks. The security of a paper wallet depends on your ability to hide it from strangers and this point is essential because most of the hacks happen because of user error.
What is the safest Bitcoin wallet?
To keep private of your bitcoin wallet, you should explore available trading platforms and their reputation. According to statistics and reviews, Binance, Coinbase, eToro, CoinDesk, Bitfinex, and some others are the safest platform for the creation of a bitcoin wallet and currency exchange. You can enhance the protection of your bitcoins by generating a paper or hardware wallet.