Bitcoin Forum

Hello forum

What is the most important reason people do generate their seeds offline (to my knowledge, this is possible with the Electrum-wallet)?


Thanks,

Joe

Most important reason? Security and making sure that your private keys don't get leaked one way or another. If you're going to generate private keys offline, chances are, you're probably going to use it for long-term storage; and you definitely don't want to get your long-term storage wallet to get compromised.

With that said, for most people, just getting a hardware wallet is a far easier solution.

And yes, creating offline backups is possible with Electrum. Better yet, through using an operating system like Tails[1].

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[1] https://tails.boum.org/index.en.html

Generating your seeds offline has no effect whatsoever. You're still going to be exposed to threats if your computer has ever been online or will be connected to the internet in the future.

If you're talking about generating seeds offline via the use of a clean air-gapped computer, that reduces the attack vectors available for adversary as the main method is through the internet. It should be possible with any wallets. If your wallet needs an internet connection to just generate wallets, then I'll be wary.

I second that what was said by @ranochigo. To fully secure your wallet as you want to create a seed offline, means you need a separate device to install the wallet. Otherwise, if the device comes online after wallet creation then still your funds would be stolen. It's easier to buy a hardware wallet rather than use a separate device for the wallet? I have been using Ledger, which allowed me to generate the seed offline and hide your private keys. So an attacker wouldn't able to steal funds without the device or seed. Always you have to sign the transaction through the device. So better to get a hardware wallet rather than use wallet software and generate seed offline.

The term is Cold Storage. If you want your bitcoins to be secured then you should keep it in a Cold Storage where your machine is not connected to the internet.
You should then generate the seeds offline and keep it that way. This way your are safe since there's no chance of any virus or attacks or spying on you.

Unless they set up a cold storage, as the others said, I see one more use case for offline generated seed: paper wallet. Of course, a Live OS is advised so you make sure the seed will not be saved onto a computer that will later go online. The seed and a few addresses from the wallet can be easily seen as a paper wallet and can be used for deposits aimed for long term hold.

If we are talking about an PPT adversary without any known exploits and/or huge monetary resources, even stealing the device won't leak the private keys.
You'd need the device and the PIN to steal funds. The device itself is not sufficient (given that no 0-day exploits exist).

Note that there still might are evil maid attacks where funds could be stolen (i.e. manipulating the nano s).

There is a difference between generating your private key offline and cold storage? Generating addresses in offline mode will not boost your security much.
The main idea is to generate addresses in an environment that scammers cannot access by cutting off all communication methods such as Bluetooth, Wi-Fi, Ethernet, or any physical connection.
if your environment have any connection at any time you will increase your risks.


For more watch:

 - https://www.youtube.com/watch?v=Aji_E9sw0AE
 - https://www.youtube.com/watch?v=itDWtP21ltk