Bitcoin Forum

Actually the online wallets are MUCH less safe. A hacker, for example, might gain control of the server and trick you into sending your private key / pass phrase or, if the private keys are stored on a server they could just take them.

Local solutions, preferably offline, are much more safe since the only way a hacker could get access is by breaking into your home. Given most of the hackers are in China, it's kind of unlikely they are going to buy a plane ticket, get a visa, fly to your country, try to find your paper wallet, etc....

By contrast, very likely thousands of them are attempting every minute to break into online wallet sites and hack them.

You need to trust the company running the online wallet and managing your private keys. Just because you need 2FA and PINs to get to your coins does not mean that some system admin cannot just copy your private key or coins directly from their servers.

Edit: by "online wallet" I take it that you mean a web-based wallet and not a wallet running on your local computer that is online, e.g. Bitcoin core. A local wallet is safer but still susceptible to trojans and keyloggers.

Online wallet providers like blockchain.info make occasional mistakes that could result in your Bitcoins getting stolen.

In 2014 a guy by the name of johoe discovered blockchain.info made a programming mistake (reusing R values) that made it easy to calculate the private keys of its user's addresses. He calculated the private keys to all the vulnerable addresses he could find and moved the Bitcoins to a new secure address. Afterwards he contacted blockchain.info and paid them back. If he'd been dishonest he could have stolen those Bitcoins.


http://www.coindesk.com/good-samaritan-blockchain-hacker-returned-255-btc-speaks/

this doesn't make sense to me, when you have your wallet online (web wallet or any desktop wallet which is connected) you are at much higher risk than storing it in paper form.

how can paper be stolen? they have to break into my home and steel a piece of paper!!!

Bitcoin on paper or file in your own home off of your computer is the most secure way to store bitcoin.  You just need to protect the hardcopy - laminate, put in a safety deposit box at the bank, or whatever is the most secure for you.

Bitcoin stored at online wallets is risky as the wallet can have issues and nothing "online" is really secure and can be hacked.

If you do use online wallets ALWAYS enable 2FA (Two Factor Authorization).

Because in the Bitcoin wallet in site is not safe i think that is their reason why they store on a file or on paper. Thats only the reason that i know because no system is safe like in the hacker movies. And if i have bigger bitcoin i dont use bitcoin wallet in bitcoin site because i want to keep it on paper wallet so that i feel safe.

Two-Step Verification is not as secure as most people thinks, email or SMS can be viewed/modified by hacker if your smartphone is compromised.

The most secure are offsite solutions like hardware wallets and properly used paper wallets. Actually hardware wallets are much more secure than any online banking I know of (they still use insecure Two-Step Verification methods)

I didn't heard for this before, actually this is very interesting story. Good samaritan is true headline, 255 bitcoins is very big amount. I wonder did he get some nice prize for his discovery.

With big amounts people should be very careful. I use online wallets for everyday needs and transactions but big stash is hidden somewhere.

People mostly do it as a safer option to storing their private data's online since anything present in the online world, has it's vulnerabilities and could lead to breaches that would make information's being leaked to hackers. Regarding the 2FA, there have been even some complications that lead to users being locked out of their own accounts due to this particular option and regardless of it's failures (on occasions), it doesn't eliminate hackers chance of getting their hands on people's account and it rather just adds a layer of security over what it is. Storing in a file could also not be that safe since if left on a computer then it's still not safe (unless completely offline) and lastly on a paper, there's the possibility of losing it or someone stealing it from you so I guess what everyone's doing, is just choosing whats best way to protect what they have.

I guess it's for extra security as in it will never be linked to Internet or anything digital so it can't be hacked in any way. As far as you are talking about it getting stolen, it will be just like any other fiat currency you need to keep it  safe the same way you keep your cash.

Paper wallets at this stage, is the next best option to keep your coins safe for cold storage. If you want to use it daily, you should go for a hardware wallet like Trezor. These online wallets with their

2FA are a bunch of bul#@$$%% and I would not trust them with huge amounts of coins. It is your responsibility to store that private key somewhere safe. If you leave your wallet with your credit

card or your debit cards on your dashboard in your car, you are making it easy for the thiefs... The same goes for paper wallets.... store them in a safe place, and you will not lose any coins. How

difficult could it be to hide a piece of laminated paper?

For extra security and peace of mind.

If you have an amount of bitcoins that you don't plan on touching or spending for an extended period of time, then may as well put in a paper wallet and keep it away in a safe place.

Also if one has a large significant amount amount of bitcoins, like thousands or tens of thousands or hundreds of thousands or millions, I imagine they would be constantly worried if their holdings are safe if it was stored online, whether in a wallet(s) or on an exchange. Unless they were actively trading that full amount, of course.

I'm confused OP, you've been wondering about it? If you actually took quite the time to do a thorough search on this forum plus on Google, you'll see why many of us holders use paper wallets.
And apparently, the user above me answered the question.

If storing Bitcoin required trust from third parties, we might as well not be using Bitcoin at all... Simple as that :)

Oh my GOD no. You're completely backwards on this. No no no. Online wallets are all centralized. Just avoid them. Make 100 copies if you're worried about losing a paper wallet but don't store anything you care about on an online wallet. Look up the 1000s of examples. Just Google it.

exactly this is so true.
i don't know what OP is thinking that he said this.

i would personally prefer to have my wallet generated ofline and kept that way without the help of any third party (online wallets)

Online wallet can get hacked or someone on the inside of the company can just steal it.

offline is safer because how would they even know you have it

Paper wallets laminated and stored in a water- and fire-proof box is the most secure way of keeping safe private keys for me. Hardware wallets are nice too but any hardware may fail in time while good old paper will stay in good condition for decades and more. Also I have been using online wallets since I started dealing with Bitcoin and I have had only positive experiences with them. Online wallets are not more secure than software or hardware wallets but they are more convenient to use for me. Of course my view is subjective however I would rate paper wallets with the highest possible security among the different solutions for keeping private keys safe.

Well looking at other people posts it seems that they feel unsafe holding their money in e-wallet. I still have confidence though that when bitcoin gains value and becomes known by the multitudes of people around the globe; better secruity systems will be brought out; hopefully to the point that ip addresses have to be authorized to use a wallet.

using online wallet even if it has a lot of security is has a lot risk like getting hacked
unlike hard wallet like file or usb you can store it safely where you want to but it also
has a lot of risk like getting the file/usb corrupt, so ill recommend if you are going to use
a file or usb to store your btc take extra precaution.

Online computers are vulnerable to hackers and should not be used to store a significant amount of bitcoins.Storing your bitcoins offline is safe as long as there is no physical theft.

Storing your coins in an online wallet service or exchange is the worst thing you can do. Storing private keys in form of a paper wallet is much safer. You can also seal the paper wallet in strong plastic to make it water proof. It's basically the most solid form of storing your coins.

I guess because of their habits.
All our life we learned that money comes on the paper and that Internet is unsafe, very risky place.
So, naturally, we feel more secure if we keep Bitcoin on the paper than in online wallet.
Paper you can touch, online wallet can't :)
I think that younger generation don't have such concept about papers and Internet any more.

The internet is a risky place but storing your wallet address on a paper file is in a way standard procedure. Like real money you have to protect it against thieves etc. So you put it in a vault.
With bitcoin you save it on paper or any offline device.

Its funny thing that until this day we write on a piece of paper and hide it. But the truth is writing on a paper is the best thing to hide something. It will last a decade and it can read it clearly. But of course you must store it on  moisture free place. Like hidden treasure or on Library that no one will ever know you hide it there. Like National Treasure Movie..  ;D

Stolen from? why thief steal a piece of a paper  ;D

Paper is better than storing in a computer i think. Your computer always can get hacked. One missclick and its over. boom. Before you realize what happened, all of your private information will be in someone else's hands.

Paper is simple. Paper is easy.

Even if your house gets robbed, the thief won't give fck about the paper anyways. You shouldn't leave it somewhere too easy to find anyway, Hiding away just 1 piece of paper shouldn't be that hard.

Read BurtW's story. Then you will understand why it does not do to store this information electronically. If you have a serious amount of coin, and you need to have a physical copy of the key info, I think you best bet is to split this info into multiple fragments, and distribute these fragments in multiple places that you don't reside. You can never be sure if a state actor is going to crash into your shit looking for private keys, and there is no protection from the state. They do what they will.

I think its still risky if its a paper or online wallet.. they are the same risk paper can be cut or will be wet at water or someone can trash it if they didnt know what is that paper.. online wallet can be hack by someone or the online wallet will be down.. so i think they are the same risk.. so if you really want to be safe just always use anti virus in your machines which is can block any virus and malware to your machines.. also try to use offline wallet and virtual os at your pc which is safe way for me..

It's a weird logic to think it is safer to give your bitcoins to someone else. Online wallets can be shut down, my wallet won't shut down.

Paper Wallets are offline, which means that even if a hacker hacks into your computer, they won't be able to touch the bitcoin you have on the paper. While this is weak the theft, most people wouldn't really know where you kept the paper, so if they wanted to rob your house for it, it would be risky as you might have kept it somewhere else. And that is assuming they know you sent the bitcoins to a paper wallet.

Desktops Wallets are on your computer, giving you access to your bitcoins at any time. If you use a wallet like Coinbase, and they shut down/run away with the funds/other stuff, you are left with nothing. Many online wallet providers have shut down, like the old mybitcoin & others. Some people kept their funds on Cryptsy, and they had 2FA. Cryptsy ended up "supposedly" getting hacked, and people were left with nothing.

you are completely wrong, I have heard that how hacker can access to blockchain.info wallet stealing your browser cookie so that they don't require email confirmation and also if they know your password which is possible if you keep using same password in all of the sites you use.

It is always better to save bitcoin private key in paper with pen, even storing those files in computer which is connected to internet is not safe.

I also think in similar way that there is no comparison between paper wallet or storing a bitcoin on file. paper info can be stolen if some one knows about it where as online info can be hacked as well.

Well i doubt you will loose paper information during an assault,only if you store the paper on the box with money and put there bitcoin keys  ,that way you can loose ,i have some information stored into the paper instead i save it online as easy gmail can be hacked these days,soo i store some information out of web,i use online wallet as well,but we need to protected our coins as we can.

Storing your wallet keys in a piece of paper is less susceptible of being stolen compared to storing it in an online wallet service which is being accessed by numerous people simultaneously. Also, no one would ever think of fortunes being imprinted on a piece of paper; nowadays, people would jump directly to digital records and steal everything from there.

Your paper wallet would only be stolen or lost under your own care, whereas in an online wallet service, you are entrusting your money to a third-party entity, which makes it scary to think that you've trusted your money to a stranger without even seeing them beforehand.

Hardware wallets or paper wallets requires that an attacker is physically on range with you, this fact alone reduces the probability of you getting hacked by 99,99%, however, paper wallets should be dealt with carefully, paper is a very fragile thing, you should have like two different copies stored in a controlled environment, and protected from curious eyes.

It seems that almost everyone in this thread is against storing Bitcoins online, well I'm all for using online wallets  :) And I believe people will change their stance on this over time, you can't keep all your money under your bed your whole life  :P For me, personally using Coinbase to store my Bitcoins is immeasurably more convenient than using local or paper wallets. It means that I can access my coins anywhere in the world without having to carry my computer and my private keys with me or having to download the blockchain every time.
Coinbase is insured anyways. Here's an excerpt from an article from Coinbase's support center regarding this:

"Coinbase is insured against employee theft and hacking in an amount that exceeds the average value of online bitcoin it holds at any given time. Specifically, Coinbase's insurance policy would respond in the event that bitcoin stored in Coinbase was lost or stolen as a result of a breach of our physical security, cyber security, or as a result of employee theft.

Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).

This insurance policy does not cover damages resulting from a specific user's loss, such as the losses resulting from a compromise of the user's login credentials."

there are a lot of things wrong with what you just said here. i have made them bold.

first of all you use cold storage (under your bed :)) for large amounts that you don't need everyday. like putting 20BTC there that you don't need to have access to every day!

second you can use online wallets, nobody is against them you should only know the risks. so keep what you want to spend there not all your bitcoin.

last but not least, the insurance as you quoted here only covers the loss if it is on their end. as i said in second, the risk of using an online wallet is being hacked, losing your coins because of weak password, having a keylogger, other social engineering hacks, .... which are not covered by coinbase or any other wallet.

You highlighted "having to download the blockchain every time." as a mistake/misconception but didn't mention it in your comment? I know of wallets like Electrum and such where you don't have to wait long but it's still a mild annoyance for me.
Also, Coinbase offers a service called the 'Vault' which is essentially offline/cold storage  :)
Of course they gonna cover the loss on their end only, you won't find any business willing to pay for customers' negligence. And it's up to each and everyone to make sure they understand the risks involved before they make any decision.
In the old days banks were being robbed all the time and people were wary of trusting them with their cash. I believe we're going through the same phase right now with Bitcoin and that it will get better as we get closer to going mainstream.
I understand that by having paper or local wallets, you control almost all aspects of your coins' security, I'm not arguing against that. It's just that for me, I would gladly trade off some of that security for the benefits offered by an online wallet service like Coinbase.

Online or Offline wallet have same security,they have same method to secure bitcoin,and i think people use papper wallet or offline wallet because they want to store their bitcoin and have static amount,because in my experience if we store our bitcoin on online wallet,we can spent easily bitcoin from that wallet,its make me can't safe any bitcoin,but with papper wallet i can't do that.

But if large agents such as Microsoft and Steam are actually allowing payments from bitcoin users; isn’t it safe to assume that the security of your bitcoin address has improved? Bitcoin is become a valuable commodity; therefore if more security measures need to be implemented, then I’m certain such action will be taken in due time if not immediately.

it may be because of their limited knowledge, just like me, I just save my bitcoin in the form of files and within a site. it's because that's all I know, if bitcoin can be brought and shaped hardware, of course I will keep very well

Can someone explain to me how exactly do store my bitcoins on a piece of paper, or on a usb. I’ve protected my wallet with 2FA but if the security right now is still yet to be improved; I’d like to know how to do it. Besides, it seems like an interesting way to store my bitcoins for later use.

You can download electrum wallet and then read its faq in here (http://docs.electrum.org/en/latest/) on how to create a cold wallet out of it.
Hope this helps, creating a paper wallet you can do so at bitaddress.org , personally I would for electrum and cold storage, although even as an online wallet it is pretty safe if you are using a safe pc and know what you are doing.

One question on electrum wallet: Do we need to download the blockchain data?

buy a hardware wallet:

https://bitcointalk.org/index.php?topic=899253.0

A hardware wallet can fail, just like memory USB sticks...

I think saving your wallet.dat file inside an encrypted compressed file on several different places is the best way to go. If you only rely on some hardware wallet, you might regret doing that. I think its better to spread it across different hard drives, usb pendrives and whatnot.