Bitcoin Forum

Very happy to see so many people trying to create new services out there. This is what will establish the Bitcoin economy. I was wondering about Instawallet type services. What benefit is there to storing Bitcoins on someone else's server that could potentially be hacked. The benefit of accessing your wallet from anywhere seems negated by the fact that the security is based on a unique URL which would be potentially saved in any computer you use.

I refuse to use such services due to the facts that you just pointed out.  Also to the fact that they could just *disappear* one day with all of the bitcoins with the wallet files.

I keep my wallet file encrypted on a flash drive. however i also have a second wallet for my trading.  I wouldn't trust these sites as far as i can throw them.

All true about trust. However I think these services are going to take off anyway. Imaging the ability to pay for things with your phone or from any computer. That is their best application. Maybe in the future people will keep a few coins in an online wallet and their main bitwealth on a USB drive?

^^^ yes completely agreed.  Keeping a small amount on an internet and then the rest on a secure platform would be the best option.  In order to limit the amount of viable assets that could be stolen.

It's a very risky move for sure, the risk doesn't outweigh the security that they promise -- infact i think the security is even worse than just using your wallet file

The benefit of an online wallet is that they can act as a payment processor offering "Instant" transactions. Real Bitcoin transactions are not generally fully trusted for 120 blocks, or about 20 hours on average. Even if the transaction is conditionally accepted after 1 block, you still have to wait about 10 minutes.

I make a daily backup of my wallet file. I suspect people who use online wallets cringe at the thought of setting up a simple backup batch file.

How can we trust online wallets that's my question. I mean, how do I know who runs those sites and what they're doing with my coins? I dunno - seems risky to me!

It is risky, but so was storing your cash in banks before reputable banks came into place. And before FDIC insurance, it was even more of a risk. It would be interesting to see if such a system came into place, but at this point there isn't anything that has such a strong reputation. Some people will need to make the leap of faith to get the ball rolling, but it won't be me.

Besides, storage resources are cheap in today's market. Back it up on several flash drives and you'll be fine.

I created a small necklace for my USB drive. They'll have to rip it from my cold, dead hands....

Honestly after what I went through lastnight almost losing my entire savings of bitcoins when backing it up i'd say the appeal for having an online account is very strong.

They won't be in business long if people get wind of them scamming people and likely an online account is more secure for people very new to bitcoin with only medium computer skills.

I sent some bitcoin to a friend as a gift and honestly it is easier to tell her to get an account at mybitcoin.com then tell her how to create encrypted backups.

The benefits of having an ewallet would be in places where you might not want to run the software. I.e a library or school and even hotels. I wouldn't put more than your wiling to lose into one but it makes things convenient. I could go on a trip and have some bitcoin in my ewallet then if I run out I can western union myself money.

I think it's the same reason people started using bitcoin in the first place. Good reputation with solid principles. Only time will weed out the mongers.

You don't strictly have to choose one or the other... eg. Keep 99% under your control, and 1% on some online service.

Even though my main wallet is at home, I still have some small change in a number of different places online. (Although I absolutely won't use mybitcoin.com as their customer service is non-existant).

To me what's different now? You use a bank?

something like www.mybitcoin.com people are talking about I'm assuming?

Yes but I feel like folks worry to much. If someone wants to take your stuff they will find a way. I say practice positive mind control.:)

Wonder how many bitcoins will get lost on flash drives...

Hello!

If you want to use your bitcoin client or wallet remotely, you can setup a VNC server on your computer and access your desktop from your phone or another computer.

Here's a guide for that.

http://www.youtube.com/watch?v=d12jq_8Sjho

Ease of use or for performing transactions while on the go from remote locations

Currently creating a web application for this that has multiple 2-factor auth options(Phone, SMS, hardware key) and wallet backups.

Was thinking about a secure low cost way store my wallet. Backuping doesn't protect it at all. Encryption seems to much of a hassle, so storing them remotely seems like a plan. But how to do that in a convenient way...?

I would advise using strong encryption if you are storing remotely. A service like dropbox will not be able to assure that no intruders get in. If they do get in you will want to have your coins encrypted in a file named "tax return" or something. It will still be breakable with strong encryption, but it will take a while. so it would be good to replace it every week.

Someone is no doubt working right now on a program to search the internet for any file named wallet.dat
Don't let yourself be the low hanging fruit.

Put your savings — not your day-to-day spending bitcoins — in a paper bitcoin wallet (http://paperbitcoinwallets.com), with keys that have never been near the internet. You still have to safeguard the bit of paper, or maybe use some SpruceCode (http://sprucecodes.com) system to hide the private key, but you have no worries at all about online malware getting at your savings.

I think one of the main problems with using some site 'out in the cloud' to store your wallet is NOT the integrity of the site itself, but rather all the knuckleheads that use it. If there's one thing that we should have all learned with the MtGox fiasco is that people do not take their Bitcoins seriously AS money. Too many see them as just a thing, a toy, something to play with, a minor diversion and they do not safeguard them with any seriousness. Too many using the same username and SIMPLE passwords at multiple sites with no thought to any real security. Passwords such as 'password' or 'abc123' or 'money'. I, for one, would NOT want my money anywhere near such people regardless of how secure the site claims to be.

For now, I'm more afraid of the stupid and/or the careless rather than the greedy. Hopefully, things will change soon  :-\

One would store Bitcoins remotely for the same reason they would store other valuable data: convenience.
Stuff stored in the cloud can be made available anywhere and may provide services such as encryption, redundant storage, backup,  search, etc.

But, the downsides must not outweigh the upsides. The bar is high in that regard for storing a lot of Bitcoins remotely because, for me, I would not use such a service unless:

1. The service provided is from a reputable, trustworthy business
2. The service encrypts data locally before uploading, preferably with an open source program that does not change often
3. There is some sort of external auditing to verify the company is providing the services promised (such as backups)
4. There is convenient integration with my local wallet(s)

And there are probably other requirements that I am not thinking of right now. I am not aware of any such service right now, but I am a Newbie, so don't take my word for it.

If the data is encrypted locally with a program you can trust, security would mostly be under your control. Otherwise, for me, there is no company on earth I would trust to properly transport, encrypt, and store my valuable data in a secure way.