As a form of security to maintain the security and safety of cryptocurrencies, we will guide you in this article on how to set up a cold storage wallet, in an attempt to reduce the risk of hacking or infiltration.
What are cold wallets?
In simple terms, cold wallets refer to keeping your Bitcoin or any cryptocurrency you own completely offline. Cold storage, also known as a cold storage wallet, is the opposite of a hot wallet where your Bitcoin is kept online. Since keeping your cryptocurrency online increases the risk or makes it possible for an attack to steal your cryptocurrency. So keeping your cryptocurrency in cold storage wallets makes a cyber attack much more difficult.
How to store bitcoin in cold wallets
The first step to putting Bitcoin into cold storage is to create an offline Bitcoin address. This address will contain a pair of keys, public and private, and will never be connected to the internet (until you are ready to spend your coins). Below we will show you how to create a free cold storage wallet using the paper wallet method.
Create a paper wallet:
Setting up a paper wallet for cold storage is fairly simple and requires very little technical knowledge.
The first step will be to go to one of the sites that provide the creation of a paper wallet through the websites dedicated to this and before doing anything else, while you are on this page, you will need to save the generated codes on your computer.
To save a web page to your local machine, press Ctrl-S and save the file as a full web page (to your desktop for example).
After saving, simply close the opened Paper Wallet Widget page.
Then disconnect your computer from the internet. Don't worry, you just need to go offline temporarily for this task. After disconnecting from the internet, open the saved file (on your desktop).
Move your mouse over the page and/or type some random characters into the text box to generate additional entropy (randomness). By doing this, you are creating a random Bitcoin address that contains a public and private key pair. Keep in mind that since you saved the file locally and were not connected to the internet, the Bitcoin address you created was done completely offline.
Print page:
The next step is to create an offline copy of your Bitcoin address which you can later upload using Bitcoin for a complete cold storage solution. While on the locally saved paper wallet page, while still offline, click the “Print” button.
Remember that before printing the page, make sure your printer is also offline (not connected to the internet via wifi for example). Now, you have created an offline Bitcoin address and printed a copy of it locally for safekeeping.
On the printed page should be your public Bitcoin address and QR code with the corresponding private key and QR code. We highly recommend storing your paper wallet in a safe place, such as a fireproof safe.
You can now connect to the Internet securely.
How does it work?
A paper wallet generator is a client-side address generator that generates Bitcoin public and private key pairs locally through your browser. The benefit of this technology is that you can load JavaScript locally and trust that the JavaScript has not been changed after loading.
Since this tool is open source and the code can be reviewed at any time, also make sure that you never share your private key with anyone or over the internet.
Add funds to your cold storage wallet:
The next step is to add the Bitcoin to the paper wallet you created. Just like with any other Bitcoin transaction, using a wallet you may have online, scan the QR code of the public cold storage wallet or copy the address, and send the funds to your cold storage. You can check the status of the funds at any time using a Bitcoin block explorer.
Recover Bitcoin from Cold Storage Wallet:
When you are ready to spend your cryptocurrency from your cold storage wallet, you will need to import the private key into your online Bitcoin wallet. Any wallet that supports importing private keys will work. Once you have successfully transferred your cryptocurrency to your online cold storage wallet, it is ready to spend.
Note: Never reuse cold storage wallets after withdrawing funds from them online. Once you have retrieved them online, follow the process above to create a new one if necessary.
With this simple and easy method, you have made things easier for yourself, and gained a wallet that is immune to hacking, as it is stored somewhere outside the Internet.
Note: We recommend keeping the paper well away from moisture and fire and never saving the private key online.