Information on setting up the paper wallet

The argument that the custody of Bitcoin is a complicated matter, persists. There are now numerous apps for desktop and smartphone that allow you to create a Wallet child’s play – if you can read. The problem: Since smartphones or PCs are usually connected to the Internet, the custody of Bitcoin on these devices comes with an inherent risk. Malware attacks endanger access to deposits, as does the possible loss of the cell phone. One thing is certain: the private keys for your own Bitcoin-Keeping wealth properly needs to be learned. One of the safer methods is to create a paper Wallet.

What is a paper wallet?

First of all: everyone has to answer the question of how much effort is appropriate to secure their crypto assets for themselves. For the technically inexperienced who only want to hold comparatively small amounts, a software wallet with an intuitive user interface can make more sense than getting bogged down in dividing up the private key, for example. Another advantage of online (also: “Hot”) wallets is that cryptocurrencies are quicker to hand when it comes to transferring, paying or trading.

At the latest, however, when it comes to HODLN larger amounts, you should look around for opportunities to make your bets Bitcoinunits – more precisely: the private keys – to keep offline. That’s exactly what one enables paper wallet. In addition to the public Bitcoin-Address includes a paper Wallet also the private key for this. It’s sort of like backing up your email address and password on a piece of paper.

How to create a paper wallet?

One Bitcoin-Address at first glance looks like a random combination of numbers and letters. In fact, it can be calculated precisely – from the private key. That’s why the private key must not fall into the wrong hands – it would be easy to get the right one Bitcoin-Determine the address and seize the BTC units deposited on it.

The first step in creating a (Paper) Wallet consists in generating a private key. For this you should (if you don’t want to take the dice into your own hands) use a reliable random number generator, such as that found at bitaddress.com. The website has all the features one needs to have a paper wallet to create. A common alternative to bitaddress.com is the website WalletGenerator.com.

Whichever tool you choose, the private key should always be generated offline. This is not a problem for the websites mentioned above, since their code can also be run offline. To do this, you have to download the websites by right-clicking and selecting “save as” or “save as”.

After you have disconnected your computer from the Internet – or even better: loaded the downloaded HTML file onto an offline computer using a USB stick – you can start creating the paper wallet go off. The file will run in the browser as usual.

Bitcoin black on white

First, the private key is generated. To help the randomness along, the program requires a series of random keyboard or mouse inputs from the user. From these inputs, the program generates the seed, which serves as the nucleus for all other wallets. The next step is to click on the tab paper wallet or paper wallet and promptly receives three Bitcoinaddresses including a private key. If you want, you can secure your wallet with a password. But be careful: Not all wallets are compatible with BIP38.

It is advisable to be Bitcoin-Split assets across multiple wallets to reduce risk of total loss. The paper wallets can be brought into the analogue world via the “Print” button. Here, too, a printer should be used that is not connected to any network.

Now you can still take the printed paper wallets with you Bitcoin fill. To do this, you send BTC to the public address (“Look and Verify”).

Tips for handling paper wallets

A paper wallet is only as secure as how it is kept. Since paper is not known for its durability, there are a few points to consider when storing a paper wallet:

• Store the paper wallet in a sealed plastic bag to protect it from water and moisture.
• Alternatively or additionally, laminate the paper wallet.
• Store the wallet in a safe to protect it from theft and fire.
• Keep a copy of the paper wallet in a safe place, with a trusted person or a notary

If you want to learn more about the different wallet types, we warmly recommend our BTC-ACADEMY.

Disclaimer

This article was published in December 2020. It was checked and adjusted accordingly for the re-publication.