Cold Storage or Multisig?

[zxcc]

Completely new to this. Haven't even downloaded the client. Just trying to get a handle on how this all works.

So which way is recommended? Which way is more secure?

If I install electrum on a computer that is online all the time and use a wallet from there, how likely is it that I can be hacked?

Thanks

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[jackbox]

Completely new to this. Haven't even downloaded the client. Just trying to get a handle on how this all works.

So which way is recommended? Which way is more secure?

If I install electrum on a computer that is online all the time and use a wallet from there, how likely is it that I can be hacked?

Thanks

How often do you get viruses on your computer or execute suspicious attachments. If you are careful chances of being hacked are low. If you are going to be dealing with BTC worth more than 2 or 3 BTC I would suggest a hardware wallet. Trezor is the best and Ledger Wallet is also okay, but I personally prefer my Trezor over other hardware solutions I have tried.

[zxcc]

Well not often but I have heard horror stories.

Like if someone knows your IP, is it easy for someone to get a keylogger on your computer without you knowing?

I don't ever run anything. I just browse and rarely even save a picture.

I just want to know if cold storage or multisig is more secure?

I get that cold storage is keeping btc on an offline computer but can it be compromised at some point if I decide to spend the coins?

[jackbox]

Well not often but I have heard horror stories.

Like if someone knows your IP, is it easy for someone to get a keylogger on your computer without you knowing?

I don't ever run anything. I just browse and rarely even save a picture.

I just want to know if cold storage or multisig is more secure?

I get that cold storage is keeping btc on an offline computer but can it be compromised at some point if I decide to spend the coins?

If you truly have an offline computer then that would be the safest method. Hardware wallets such as Trezor are very safe especially if you initialize them on an offline computer. Whenever you spend coins from a cold wallet you should then send all the remaining coins to a new cold storage address to protect yourself from the scenario you allude to above. If you are using a hardware wallet such as Trezor you don't need to worry about that as the private keys never leave the device. As long as your seed is safe, your hardware wallet is safe.

[shorena]

Well not often but I have heard horror stories.

Like if someone knows your IP, is it easy for someone to get a keylogger on your computer without you knowing?

If you keep your system updated and dont directly download malware it is very difficult or expensive to break into it. It would require the use of what is called 0-day. An exploit that is not fixed and was sold in secret. This is not something your average attack has available.

I don't ever run anything. I just browse and rarely even save a picture.

I just want to know if cold storage or multisig is more secure?

There is no easy answer to this, because it depends. Multisig can be more secure depending on the circumstances. Who can sign along with you? If its you on a different computer, how secure is that computer in comparison to one that is never online?

I get that cold storage is keeping btc on an offline computer but can it be compromised at some point if I decide to spend the coins?

It can, but its even more difficult than attacking a well updated and clean computer.

Whats cold storrage? You have an online computer that shows you your balance, but has no private keys. You use this computer to create an unsigned transaction. You transfer this unsigned transaction to the offline computer. This is where it could break apart. E.g. if your online computer has malware that spreads via USB sticks and you use an USB-stick to get the TX from the online to the offline machine, chances are its compromised. The malware will have problems getting any data out though. You could also just transfer the data by hand, e.g. type on your offline system what you see on your online system. Once the TX is on the offline system you load it into the wallet software, check if its what you want, sign it and transfer it back to the online system. The online system is used to broadcast the signed TX to the network.

[BitcoinNewsMagazine]

Completely new to this. Haven't even downloaded the client. Just trying to get a handle on how this all works.

So which way is recommended? Which way is more secure?

If I install electrum on a computer that is online all the time and use a wallet from there, how likely is it that I can be hacked?

Thanks

It happens all the time even with password protected wallets. There is malware that specializes in searching out wallet.dat files and uses a keylogger to grab your password. You could start out right by using a hardware wallet, which keeps the private keys to your bitcoin safely offline. Ledger sells the HW.1 for less than $20 and there are other options like Trezor. Here is a review of the best bitcoin hardware wallets of this year.

[OmegaStarScream]

Completely new to this. Haven't even downloaded the client. Just trying to get a handle on how this all works.

So which way is recommended? Which way is more secure?

If I install electrum on a computer that is online all the time and use a wallet from there, how likely is it that I can be hacked?

Thanks

Using Electrum should be safe just like using any other Desktop wallet however you should make sure to not download things like "Bitcoin Generator" "Steam wallet code generator" and that kind of silly stuff that you find in internet and execute without knowing the content .
Other then that , Cold storage (like Paper wallets) is much more safer since it doesn't touch the internet at all and if you hide somewhere safe you are fine however if someone finds it and the private keys wasn't encrypted then you are screwed .

[mexicantarget]

I wouldn't suggest you any online wallets to be honest. If you're the "average" internet user, then you're in danger of getting malware in your computer and losing all your funds.
What would I suggest you is to buy a Trezor hardware wallet, where your funds will be 100% safe.
I have a Trezor wallet and I can't complain.

[twister]

I use Electrum cold storage wallet and till now haven't faced any problems, multisig can add another layer of security to your cold storage but I never really felt the need for it because I make sure that the machine which has the keys stays offline and is only used to sign the transactions but as Shorena pointed out if you have a malware on the machine which is online and that malware spreads through USB then it can compromise the security of your cold storage wallet but this is why I use Linux for my cold storage and autorun programs/malwares don't get executed even if they're carried to the offline machine, although I make sure that my online computer is clean as a whistle.

But there is another way to avoid this problem, Paper wallets, make them offline, print them and use them only for one transaction, for example, you want to spend 0.5 BTC to 'A' from your paper wallet which contains 1 whole Bitcoin, so you go to your offline machine, import the paper wallet's keys, make a transaction where you send 0.5 to A and the rest of the BTC, which is 0.5 you send to the other paper wallet which you made earlier, bring the transaction online, broadcast it and voila! your bitcoins are safe because even if a malware or hacker knows your keys, password, etc. they cannot know the key of the other paper wallet which you printed offline.

[jackbox]

I wouldn't suggest you any online wallets to be honest. If you're the "average" internet user, then you're in danger of getting malware in your computer and losing all your funds.
What would I suggest you is to buy a Trezor hardware wallet, where your funds will be 100% safe.
I have a Trezor wallet and I can't complain.

I have a Trezor, a BWallet (Trezor Clone) and several HW1 (two converted to Ledger Wallet functionality). I can say that after using all three I prefer my Trezor over the others. When at home my BTC is stored using the Trezor. When I travel I transfer a small amount of BTC to the HW1 as it is much smaller and easier to keep with me. I can use it with an OTG adapter on my Android phone with Mycellium. I have setup all my hardware wallets with Mycellium and it works with all three of the hardware wallets mentioned above. In today's world a hardware device to protect your BTC is really a necessity if you want to prevent losing it to a hacker or malware.

[unamis76]

The right answer is: whatever you feel most comfortable with. It should have a balance of easiness of use and security that is at your knowledge level and that allows for easy fund withdrawal if you need them.

Also, you can always employ both

[zxcc]

thank you everyone for responding.

I will go ahead and make a cold storage wallet on an old computer with its network card removed so it will never go online

 ...You could also just transfer the data by hand, e.g. type on your offline system what you see on your online system. Once the TX is on the offline system you load it into the wallet software, check if its what you want, sign it and transfer it back to the online system. The online system is used to broadcast the signed TX to the network.

thanks for this info. This to me sounds like what I'll do for transactions so the online computer and offline computer never "touch"