The seemingly unstoppable surge the cryptocurrency industry is experiencing this year comes with its own kinds of challenges. This article goes into the different methods of storing Bitcoin securely.
Cryptocurrency users especially those with the most value such as Bitcoin find it increasingly harder to sleep soundly when they worry about their digital assets being whisked away by a criminal behind a keyboard from thousands of miles away.
Keeping Bitcoin safe is the sole responsibility of its holder, as no bank will keep it for you due to the fact that it is a stateless currency which was never issued by any Central Bank in the world. Bitcoin, in general, is stored by its owner using what are known as wallets.
These are a variation of either hardware or software that are highly encrypted and bear coded addresses with which the user sends, receives, and stores their crypto holdings. When it comes to choosing a mode of storage for your Bitcoin, you have quite a number of options, but the best ways are as follows:
This is considered as the most reassuring way of storing your Bitcoin. Hardware wallets are specialized portable devices that were designed specifically for the storage of Bitcoin and some other cryptocurrencies as well. It is designed for those who want a secure vault-like facility to keep their digital assets safe and away from the reach of hackers.
Hardware wallets a big on security and usually have multiple layers of cover to frustrate any attempt by criminals to reach your storage. Hardware Wallets are mostly kept completely offline and are not designed for making everyday transactions. Their high security, however, comes at a cost, as they are usually priced in the range of $100 and above.
The majority of Bitcoin users are not those that hold huge volumes that require the use of hardware wallets or other expensive methods of storing them. Bitcoin is valued in the thousands of dollars these days which makes it imperative for all kinds of users, no matter how small their volume of holdings might be. Cold Wallets are the perfect option for this category of Bitcoin users. These are everyday software wallets that are intentionally kept completely offline by the Bitcoin holder on a PC or Mac computer. The fact that the wallet is isolated from the rest of the world makes it pretty impossible for hackers to reach it or do any harm to your Bitcoin holdings.
One of the newer, simpler and highly secure ways of storing your Bitcoin is by using Paper Wallets. The simplicity of this kind of storage belies its extremely secure nature which makes it among the most popular ways Bitcoin users keep their assets.
A paper wallet is a kind of Bitcoin Wallet in which amounts of Bitcoin are printed in the form of QR Code on sheets of paper which are then stored by the user in safes or vaults, completely cut-off from the digital universe where the threat to Bitcoin abides. The genius in paper wallets is that it mimics paper money and it is absolutely impossible for a hacker to reach it unless someone comes and physically remove it from where you stored them.