It might sound like keeping your bitcoins in a refrigerator, but the truth is very different. Regarding cryptocurrency, the wallets that store them are referred to as hot and cold storage. Being new to the world of cryptocurrencies, knowing which ways are best and which are worse can be difficult because there are so many to keep your Bitcoin.
We’ll help you through the process of setting up a Bitcoin cold storage wallet in this blog. Before getting started, let us give you some info about Bitcoin cold storage wallet.
Bitcoin Cold Storage
The term “Cold Storage” describes storing all of your bitcoin offline. Cold storage also referred to as a cold storage wallet is offline in contrast to a hot wallet which stores your Bitcoin online. As a digital asset, Bitcoin is more vulnerable to theft while maintained online even when they are being stored through a custodial service. You can significantly reduce your attack surface by storing your Bitcoin in cold storage.
Advantages Of Bitcoin Cold Storage Wallet
Bitcoin cold storage is perhaps the best option if you’re wondering how to keep your cryptocurrency offline. Although not nearly as common or frequently used as hot wallets, cold storage for Bitcoin is continuously expanding and gaining more and more recognition.
First off, the safest way to hold your Bitcoins right now is in cold storage. The cryptocurrency coins are kept in a little gadget that can be hidden away in any feasible spot that is out of sight, carried around, or put into a safe or strongbox.
Since these gadgets don’t need an internet connection to operate, the majority of the risk of theft, fraud, and other crimes is eliminated just by this feature. Apart from safety, Cold storage gives you a sense of control that hot wallets just cannot match.
If you want, you can literally always have the Bitcoin cold storage device by your side by keeping it in your pocket throughout the day. All of its actions, including those pertaining to transactions and safekeeping would fall under your jurisdiction. The knowledge that you’ve this choice gives you peace of mind that your coins will never be lost or stolen.
Setting up a Bitcoin Cold Storage
Creating an offline Bitcoin address is the first step towards storing your Bitcoin in cold storage. Both a public and private key pair associated with this address will never be shared online (unless you’re ready to invest in it). Using the paper budget technique, I’ll show you how to create a free cold wallet in this part.
Developing a Paper Wallet
It’s not too difficult to set up your cold storage paper wallet and it very much requires little technological knowledge.
- Using the paper wallet tool below from Bitcoin.com will undoubtedly be the first step. While on this page, you should save it locally to your computer before continuing.
- Use the keyboard shortcut Ctrl-S to save a webpage as a whole file to your local computer.
- Simply open the Bitcoin.com paper wallet after saving. Then unplug your PC from the internet. Don’t worry, you’ll only need it offline for a short while to complete this task.
- Launch the stored file(on your computer) after cutting off your internet connection.
- To add additional decrease(randomness), move your computer cursor across the page and/or write some random characters into the text box.
- You generate a random Bitcoin address with a public and private key pair by doing this. Since you saved the file locally and aren’t connected to the internet, the Bitcoin address you generated was completed offline.
Page Printing
The next step involves creating an offline copy of your Bitcoin address which you can then load with cryptocurrency to have a fully cold option.
Click the print button while still disconnected from the internet on the locally conserved paper budget webpage. Publish the page after you’re confident.
You have currently generated an offline Bitcoin address and printed a local paper copy for storage.
The public Bitcoin address and corresponding unique secret QR code should be posted on the published page. I strongly suggest keeping the paper wallet in a safe place that is resistant to fire. You can now securely re-connect to the internet.
How does it work?
By using your browser, the client-side address generator for Bitcoin in the paper wallet creates local pairings of public and private keys. This method’s advantage is that it allows you to load JavaScript locally, on your PC, and ensures that it remains unchanged after being filled in. The program’s code is always available for inspection and is open source. Don’t ever share your private key online or with anybody else, as well.
Funding Your Cold Storage Wallet
As with any other Bitcoin transaction, use an online wallet to check the public cold storage wallet QR code or copy the address, then transfer money to your cold storage. A Bitcoin block explorer can be used at any moment to see the current status of the funds.
Redeem Bitcoins
Importing the personal key into an online Bitcoin wallet is required when you’re ready to make investments from your cold wallet. It will work with any wallet type that allows you to import special tricks. An example of how important the private key would be to download Bitcoin Unlimited which is a full wallet client.
Conclusion
The discussion around Bitcoin cold storage is only a small portion of a larger one. As cryptocurrencies gain in popularity, more and more people look into the wallet choices available which leads to an increase in the number of those possibilities. Security is a good general rule of thumb to keep in mind. Prioritize the security of your crypto holdings at all times and select both hot and cold wallets appropriately.
Zodeak is a leading Crypto wallet development company that considers different business requirements based on the industries they belong to. Even the most difficult assignment can handled perfectly by our experts. To strengthen our client’s business models, we are prepared to provide crypto wallets with robust security features and an intuitive user interface.
Get in touch with us to get to know more about the Crypto wallet development!
