Bitcoin Forum

I see alot of posts in general forum as well as Indian forum about Bitcoins getting stolen .. I am gonna explain how I store my Bitcoins .. Please find any fault with this method, and make sure to comment

This is what I follow (Semi Cold Storage)

A dedicated laptop with finger print scanner.
Installed Original Windows 8.1 ( pirated may have keyloggers)
this laptop is only for syncing Bitcoin Core ... The wallet in this PC will be used to only receive funds.
No web browsing .. Strictly syncing Bitcoin Core
copy of wallet.dat double encrypted and stored offline. (Bank Locker , not in India , just in case of natural disaster)
Daily backup of wallet.dat  to secure online storage (never use dropbox / google drive)  PM for details on this ( do not want to share in public)
password for wallet.dat not stored online , not written on papers.. use brain wallet .. make sure its 20 characters with atleast 5 special characters
All accounts made should for online storage should be new , never used , onetime password .. activated with 2FA from Android Phone
Do not Root your android phone , do not install random apps , and NEVER install anything from outside the PLAYSTORE
No WIFI .. I even removed WIFI Drivers .. Only Ethernet connection.
Firewall Installed (home network)
Just for fun - Installed Hitman Pro and Norton 360
Laptop is connected to Internet maybe once a week  , remaining time switched off and battery removed . Use http://blockchain.info/ to check daily


Never share your real identity online .. hackers can just hack your facebook account and ask for bitcoin .. 2FA , ALWAYS

BK

double encryption is ok.. unless the encryption becomes corrupt. or you get amnesia. Alzheimer's and forget passwords.

i would still have passwords wrote down. but done in a way that is not obvious.

some people have a random book in their house and they use the first letter of every line of a certain page to make up the password.

so for instance this post will make up the password 'dissoo'. but yea, choose a novel with atleast 20 lines per page, one of those small print novals.

or have the first letter of the first word of each page and have a 200 page novel to create a 200 character password :D

other methods for online passwords is to have a simple sha hashing script (check sourcecode), use the novel words idea then add the websites name to that password. and SHA it

EG
SHA("bitcointalkdissoo")

And use that sha'd phrase as the password you type into websites, that way each site is unique

I don't understand why you have paranoid security on your online computer. The whole point of cold storage is to remove the private keys from the online computer so there is nothing to steal if it is ever compromised.

Here's a simpler and more reliable method.

Online Computer (must be connected to the internet)
1) Download and install Bitcoin Core
2) Download and install Bitcoin Armory.
3) Use Armory's built-in package verification to ensure you have the true installer version
4) Download the blockchain. . . .

Offline computer (no network connections of any kind)
1) Install a legit copy of Windows
2) Full format a USB stick
3) Install the verified Bitcoin Armory package from the USB stick.
4) Create a wallet
5) Create a paper backup. Write down the numbers on a piece of paper -- don't print it.  
6) Export a "watching-only" wallet to the USB stick

Online computer:
1) Import the watching only wallet
2) You're done.

The online computer will show wallet transactions and balance. You can use it to create unsigned transactions.

Use a clean USB stick to sign the transactions with the offline computer.

Use the online computer to broadcast your signed transactions.

remember this letter from Arnold to the California State Legislature? Using the first letter of each line, there was a hidden message which he said was just an unfortunate coincidence.
-
Originally Posted by The Governator

For a year now, I've been asking for more substantive bills.
Under our system of government, it is important that we maintain our priorities.
Care must be used in managing the budget of the state.
Keynes is not an excuse for fiscal irresponsibility.

Yet whenever I try to pass fiscally sound legislation, I am thwarted.
On several occasions, we have had to borrow massive amounts of money.
Under my authority, I therefore veto this bill.

Sounds so much simpler than a credit card.

Which never get stolen and have no fraud. . .

I use a brainwallet with the passphrase 'password qwerty'

I didn't read all that but it is pretty simple.

Print a bunch of paper wallets. Public address on outside. Keep a stack of them in a locked box.

When you acquire a bunch of coins, send them to the paper wallets, breaking them into 0.25 BTC groups.

Don't keep more that 0.25 BTC in your software wallet.

Then when you need to spend, open an envelope and import the private key within.

It really is simple, and for lots - you can store them in a safety deposit box long term.

Not difficult and even if you are hacked, they only get whatever piddle amount you have in your software wallet.

Are you sure that the Original Windows 8.1 prevents all types of Keyloggers? I am using that OS along with Kasper. Am I safe? Do I need to take any additional protection to secure my system?

It does not prevent all types of keyloggers.

I think what the OP meant was that if you use a pirated copy, it may have one.

Using pirated software in general is very very dangerous. If too cheap to buy software, use Linux.

For those without an extra computer, you can install linux on a usb stick and use that. I'm quite the linux noob and I managed it.


Can you explain what is wrong with printing the paper backup?


Thanks.

Because the document can theoretically be recovered from the printer queue. Especially risky if you are using a network printer.

See here: http://www.ehow.com/how_6616927_recover-printed-files.html

OK I've deleted the print spool (linux directions here: http://superuser.com/questions/155933/is-there-an-approved-way-to-clear-var-cups-cache-on-a-unix-system)


It didn't say anything on your link about network printers. Can you elaborate (my printer is connected directly to the router)?

Surely having to go to such lengths to protect your Bitcoin is only going to make it harder for mass adoption?

A network packet sniffer can be used to intercept/eavesdrop print data. See here: http://www.pcworld.com/article/254518/your_printer_could_be_a_security_sore_spot.html

That's worrying; I'll look into it. Thanks for the help.



eidt: Actually I remember I didn't use the network printer as I was printing from an offline OS. The printer I used (Canon MP480) doesn't appear to have an internal drive)

OK... I am using original Windows 8. What should I do to prevent someone stealing my passwords and codes using a Keylogger? Can Kasper prevent these keylogger attacks?

I printed wallet with 3D printer, QR code and private adreses. I keep them all safety.

Quoted for truth

Hardware wallets might help in future to use Bitcoin safely even on compromised computers.

It's great, that you pay such a great deal of attention to your bitcoins in order to not get them stolen. But the general publich will never want to invest such an amount of work. This needs to be solved until bitcoin can hit mainstream in any way!

On the topic of defeating keyloggers, I have a text file containing bits of my passphrase mixed amongst random text. When I want to enter the passphrase, I open the text file and copy & paste using the mouse the relevant pieces into the password field.

I know how most key loggers work, and most do not capture the clipboard contents.

too much security but you don't really need them all :)

How much bitcoin are you storing with that secure way ?

to be honest, its not so difficult to store the btc safe:

just make sure your pc is maleware free , encrypt the wallet and store it offline is enough.

but: no mainstream user will go trough 10 steps to secure the btc. as more and more people join in, more and more btc will be stolen. we need mainstream-solutions were people can store it online (with insurance) or on a device like trezzor.

I'd been keeping my bitcoins since 2011, and isn't that difficult. Just that I use Linux, have no Win computer, and store some of them under different approaches, including "in the outer space" (brainwallets)

I can not recommend brain wallets because too many people will choose pass phrases that eventually get cracked, and there is no way for next of kin to get the funds if you die.

Paper wallets can be imported by next of kin and can contain private keys generated using a high entropy random generator.

I've also never had any bitcoin stolen. I try to keep them all safe in my purse!

Windows 8.1

did you disable all non core services especially networking assistance etc

no doubt you just installed the most major trojan horse delivery system in the world

and your calling this setup secure some how ? i would go with linux though

also recommend some self evaluation of the programming code,

as always your level of security is proportional to the size of the funds your storing

That's actually not a bad idea! Keep a (distributed!!!) part of your private keys with you, so you can recover it by combining it with other distributed parts of the key you hide somewhere else. That way you don't lose your stash when someone should steal your purse!

The only criticism I can make is the use of closed source proprietary software...

For cloud storage something like SpiderOak does the trick.

If you have your wallets protected with strong passwords, if you die your next kin can't get to them either.
Paper wallets can get stolen IRL.
Ideally NEVER keep all the eggs in the same basket: never keep all your coins in the same place/method.
As secondary measure scan the public keys (addresses) to your watch-only blockchain app, if you use this, for keep an eye at cold storage.

Thanks, I'm just gonna email this to my grandma so she can get on this bitcoin train that is clearly flawless

perhaps u better off converting 95% of your BTC to fiat and be done with it all

If you get amnesia or are generally forgetful then if you forget the password then you're likely to forget the cipher in which you used to generate the password in the first place.

why would you connect to the internet at all with hardware used for use if wallet.dat and private keys?

sign transactions, then use a usb to transfer, or copy over a single private key import and spend all back to a private key that has always been offline.

there is no need to snych the bitcoin cold storage computer to the internet ever. Put a screwdriver through your ethernet/wifi if you have it.

yes,many people don't like these fussy steps to secure their wallet. Easy solution needs to come out before it goes mainstream.

Not sure why you would back up your wallet.dat online. That sort of defeats the purpose of everything else.

Also, your fingerprint scanner saves the fingerprint data on your computer actually making it less secure if you actually use it instead of passwords.

For me I have a separate computer that I never ever put online, it comes with physical hard drive encryption. The BIOS is password protected, the hard drive is password protected and the Linux I installed is encrypted and password protected. That is all before getting to the Linux login.

The only thing installed on there is the Bitcoin Core which I used to create Public and Private keys which are stored in an encrypted file on the computer.

I create a separate file with just the public keys which I then burn to a CD-R.

I move the CD-R to my online computer. I send my bitcoins to the addresses on that list breaking it up into small amounts as to not attract attention to a big address. I literally just burned all CDs with any public addresses in a fire yesterday.

I do not trust USB drives as I do not trust that there could not be extra software built into the hardware or part of the USB software (look up thumb drives and how Iran's Nuclear facilities were infiltrated).

I do keep some bitcoins online for day to day spending but if those were stolen it is not enough to be too upset about even though I use 2FA.

That sounds awfully dangerous. How can you be sure that the majority of keyloggers or even backdoor malware actually don't transmit your clipboard contents? This seems like one of the most dangerous or naive methods I've seen  ;D

My hobby is reverse engineering keyloggers (hardware & software). Yeah, I shouldn't have recommended that technique because there are other classes of malware that read clipboards and input fields directly. Still, it would work against a hardware keylogger.

Linux is better than Windows as it is virus free. I also use Linux. If you want to give your BTC to your Son/Daughter, then brainwallets will be useless if you die unless you tell them. It will be good if you convert them to Fiat currency, if the USD/BTC price is average or higher.

Need suggestion...
Multisig is better, right? For families, it will be better to use multisig. So why don't you use Multisig?

Kindly,
       MZ

That issue exists for brain and regular wallets with password.
Multisig can help if you want to force your children to come together after you die, as they will need each other to be able to access the key. Otherwise is more for e-commerce escrowing.

My idea around that one was to built a password I could explain "how is it made" in a way that my descendants are able to access it after one month of trying or so; the money there worth the try. Still 1 BTC is holding half-way and kept as watch only address as trip wire in case they try to get it before I'm gone.

Here is what I do. For cold storage it is really simple. I keep copies of the public and private keys and send coins to the public address. I don't need to worry about any software until it is time to spend the coins, which I have never done to date.

How do someone can stole that?? Is the btc are not protected by stole??

Even then you won't necessarily have to worry about the keys! You could just sign your transactions on an offline device that's never connected to the internet and then publish the transaction on your main machine. That way no one can ever get hold of your private keys!

Depends on how much of BTC you have, if it is just a few bitcents won't pay of for have a dedicated computer for it.

so what is the best way to secure my bitcoins so they won`t be stolen?

It depends on the amount and what you're comfortable with.

I have an external portable drive that has my most of my bitcoins stored with it, it's running with bitcoin core.

I only connect it to the internet once a month to update for the blockchain.

I know my private keys off by heart and I have a stored copy of it in my dad's vault.

But btc includes security of 2 times spent, and how can you to make your transactions more safely??

Oh,  that wallet only receives.  Im planning to hodl it hard.

You don't have to. Just have a dedicated partition for it or use a live cd to sign those transactions. That way you'd have to spend 0.50-5.00 USD I guess...

There are Malwares and Trojans for stealing BTC. If they got access to your computer which has wallet, then there is a likely chance of stealing your BTC.
Kindly,
      MZ

Just dont come back here and cry when you lose your coins ok kiddo?

The worst in security is when you think you're secured.

Interesting and secure... you could teach classes on this...Bitcoin needs it.

Taken on a different approach; the bitcoins I lost along the way. All of them were to online services, namely MtGox then MyBitcoin.com (same user/pwd combo) then MyBitcoin.com again (MBC went offline).
So whatever you do I would always recommend to stay away from online wallets and just leave at an exchange what you intend to exchange in a short term.

Earlier I used walllets on my pc but because of network problems, now I am using Blockchain wallet. I think it is secure. :) Anyway, I too suggest to stay away from online wallet unless you don't have any other options.
Kindly,
      MZ

It is likely bitcoin in 10-20 years will look different than how it does today, possibly easier for "the mass" to adopt.

Good write up!  I do something similar.

Things will change in time. Bitcoin will become easier, more user-friendly, more secure for the average joe.

When that happens, you will know. Because you will be rich.

But then, you would protect your PC, and btc protect include protects of all users. It's so sad i think.

'If that happens', I guess! We can't know for sure if the whole experiment succeeds. Well, the experiment will succeed anyways, it already has. But if the technology 'Bitcoin' will succeed remains to be seen.
Also, maybe we won't be rich if our Bitcoins are stolen before that happens  :P