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Author Topic: Storing BTC/LTC long term in safe deposit box  (Read 3382 times)
FreedomCoin
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March 21, 2013, 04:43:20 PM
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Hello all,

Since the announcement of Avalon asking 88btc for their ASICSs my plans of ordering batch #3 is not looking good.

My backup plan for a long term investment in bitcoin would be taking part of my current earnings (maybe 15btc and 30ltc), moving them to another wallet. Backing up the wallet.dat file to a CD or thumb drive and storing it in my safe deposit box at my bank for years to come. Alot speculate with finite amount of coins they will only increase in value. So my plan is to hold long term for many years.

Has anyone done this? Or can speculate on the best practice of doing this? Ill write out my current plan below.

1. Install bitcoin-qt and litecoin client on 2nd computer or VM.
2. Move part of balance to new wallets/addresses.
3. Backup wallets to .dat file (no encryption).
4. put .dat files on CD or thumb drive, and then delete the wallets from the 2nd computer or VM
5. put CD in safe deposit box or other long term storage unit.
6. Profit?

Also would i want to make a paper wallet in addition to saving the .dat files, in case for some reason the CD or thumb drive is unreadable when i decide to use the long term stored coins?

And one other thing, does anyone speculate the IRS tax me if i decide to exchange the coins to dollars many years from now... Just like how people but stocks, then cash them out many years later?

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March 21, 2013, 04:46:07 PM
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Make sure to use multiple CD's, thumbdrives or whatever. And put the hardware needed to use those things (i.e. a laptop) in the vault as well, along with complete instructions on how to redeem the stuff for fiat.

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March 21, 2013, 04:55:22 PM
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Make sure to use multiple CD's, thumbdrives or whatever. And put the hardware needed to use those things (i.e. a laptop) in the vault as well, along with complete instructions on how to redeem the stuff for fiat.

I think making copies of the media is a good idea, but do i really need to store my laptop away? Wouldnt the .dat files be sufficient? I believe that holds my funds and address tied to those funds.

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March 21, 2013, 05:01:04 PM
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Make sure to use multiple CD's, thumbdrives or whatever. And put the hardware needed to use those things (i.e. a laptop) in the vault as well, along with complete instructions on how to redeem the stuff for fiat.

I think making copies of the media is a good idea, but do i really need to store my laptop away? Wouldnt the .dat files be sufficient? I believe that holds my funds and address tied to those funds.
I think as a way to access them in an emergency. Since you will need a computer to get to them. You could buy any cheap used netbook for that purpose.

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March 21, 2013, 05:07:19 PM
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Using flash drives or solid state drives for years is not good idea. Flash cells discharges over time and slowly lose data. According to paper released by HP the time can be from few months with worn SSD drives written in elevated ambient temperature to 8 years (for SLC flash drives) from my own experience. Contrary good quality CD-R stored in controlled environment have lasted 15 years and counting.

Take a look at Armory client with the deterministic wallet paper backup. Print many copies and store them in separate places.

Storing anything in bank is not good idea. It can be confiscated by government, stolen by robbers or destroyed in fire. Hide the paper backups in old way like deposits of gold.

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tosku
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March 21, 2013, 05:32:07 PM
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If you are using paper wallets, make sure to use ink that doesn't fade away over time.

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March 21, 2013, 05:44:23 PM
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I started out before there was any wallet encryption and thus rolled my own using openssl.

It might be worth considering making multiple deep storage wallets sized for where you think the price might go.  I did this and am very happy for it.  One possible recovery method is using the wallet import features of one of the on-line wallet services.  I personally would feel queezy about doing this for very high-value sizes even though the value would only be under control of someone else briefly.  Who knows if a 'glitch' might crop up when someone entrusts them with $100k in one shot?

For one, I can have a systematic naming scheme representing the total value, date, etc.

For two, I can sell an entire wallet.dat and that can be handy in some instances.

For three, I can instruct my heirs (who know that I've got some value in the solution and will find my backups in my safe deposit box) that if they need to retain a professional to retrieve the value, to do so incrementally.  Thus they cannot be fully ripped off in one shot by a dishonest geek.

FWIW, I recently took a cold storage wallet made with bitcoind compiled in the middle of 2011 and it worked fine in an 0.8.x pre-compiled linux build of bitcoin-qt.  (This new build also synced in under 24 hours, and uses modest resources on a powerful system so LevelDB is impressing me thus far.)


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March 21, 2013, 05:55:50 PM
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And put the hardware needed to use those things (i.e. a laptop) in the vault as well, along with complete instructions on how to redeem the stuff for fiat.
Hardware isn't really required. It is a commodity and easily virtualized or emulated. Store all the software required to access your wallet, including all the dependencies.

Also, of the generally available optical media DVD-RAM are the longest lasting and have the lowest failure rates.

Please comment, critique, criticize or ridicule BIP 2112: https://bitcointalk.org/index.php?topic=54382.0
Long-term mining prognosis: https://bitcointalk.org/index.php?topic=91101.0
FreedomCoin
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March 21, 2013, 06:01:22 PM
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I do not understand why i would want a netbook or laptop to take up additional space in my safe deposit box? Those have hard drives and or SSD.. I think a CD with the wallet.dat file and a paper wallet equivalent of that (if i can both) would be fine... Maybe im missing something? When i decide to use or sell them years from now wouldnt i just need to download the bitcoin client, sync with the block chain and then add the wallet.dat file to the bitcoin program directory?

How would using Armory be more secure than doing what i recommended in the first post? And my worry about using Armory is what if it is no longer supported years from now and i cannot transfer funds out of the Armory to a BTC client?

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March 21, 2013, 06:02:35 PM
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And put the hardware needed to use those things (i.e. a laptop) in the vault as well, along with complete instructions on how to redeem the stuff for fiat.
Hardware isn't really required. It is a commodity and easily virtualized or emulated. Store all the software required to access your wallet, including all the dependencies.

Also, of the generally available optical media DVD-RAM are the longest lasting and have the lowest failure rates.


When you say software and dependencies can you be more specific?

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March 21, 2013, 06:30:00 PM
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When you say software and dependencies can you be more specific?
You'll need to preserve the software you used to create and manipulate your Bitcoin stash. Do not assume that it will not change. It will change and none of the current developers have the resources to properly test their current versions for backward compatibility with all previous versions of itself.

"Dependencies" means all the software required to build the software above. Edited to add: For exampe: if you used Armory on Ubuntu 12.04 then you need to save all the Ubuntu 12.04 plus the source code to the exact version of python, swig, Qt-toolkit and whatever else is being used to rebuild Armory.

I cannot be more specific, because I don't know the answer myself. You'll need to either learn this yourself or pay somebody to do the research for you. You can either do it now cheaply or later much more expensively.

Please comment, critique, criticize or ridicule BIP 2112: https://bitcointalk.org/index.php?topic=54382.0
Long-term mining prognosis: https://bitcointalk.org/index.php?topic=91101.0
stepkrav
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March 21, 2013, 07:54:57 PM
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I wouldn't feel so comfortable storing an bitcoin wallet in a bank. In the future, they could tax you or take your stuff or whatever. One thing we should learn from bitcoin is to trust many peers not one and certainly not a bank. No? Can't you think for a better place to store a paper wallet?
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March 21, 2013, 08:03:26 PM
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The problem with using hardware is that it changes and it could fail due to heat or moisture or rust or...

Download vanitygen and create a public and private key.

Write them down or etch them into metal or stamp it into something, etc.

Send your BTC to the public address and you are all set.

You could even scratch the private key into a rock and bury it in your yard or whichever. Etch it into the foundation in your home. Carve it into the wall in the closet then cover with wall paper...

plenty of options for just saving a string of characters

http://www.bitpools.com
Pool your bitcoins with others. Vote on solutions using the Bitcoin blockchain. Keep your bitcoins in your cold storage until you find a solution you like.
Links and Reviews of useful every day places to spend bitcoins: https://bitcointalk.org/index.php?topic=943143.0
Herodes
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March 21, 2013, 08:10:03 PM
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Rather than storing anything in a safe deposit box in a bank - I wood go out in the woods and put everything in a 'survival box' and dig it down somewhere. Seems safer than the bank option to me. To reduce risks, you may even split it out (several wallet - several boxes). Then GPS-mark those places, and come back in 5 years. Wink
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March 21, 2013, 08:14:25 PM
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Rather than storing anything in a safe deposit box in a bank - I wood go out in the woods and put everything in a 'survival box' and dig it down somewhere. Seems safer than the bank option to me. To reduce risks, you may even split it out (several wallet - several boxes). Then GPS-mark those places, and come back in 5 years. Wink

Agreed, as with gold and silver, bitcoin is a way of getting out of the banking system. I wouldn't be in a hurry to put your money back in.

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March 21, 2013, 08:22:08 PM
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The problem with using hardware is that it changes and it could fail due to heat or moisture or rust or...

Download vanitygen and create a public and private key.

Write them down or etch them into metal or stamp it into something, etc.

Send your BTC to the public address and you are all set.

You could even scratch the private key into a rock and bury it in your yard or whichever. Etch it into the foundation in your home. Carve it into the wall in the closet then cover with wall paper...

plenty of options for just saving a string of characters

Agreed, for long term storage, forget about hardware and software. A private key is all you need. Hardware and software will change over time, but the public/private keypair is fundamental to bitcoin.
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March 21, 2013, 08:54:39 PM
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Rather than storing anything in a safe deposit box in a bank - I wood go out in the woods and put everything in a 'survival box' and dig it down somewhere. Seems safer than the bank option to me. To reduce risks, you may even split it out (several wallet - several boxes). Then GPS-mark those places, and come back in 5 years. Wink

Agreed, as with gold and silver, bitcoin is a way of getting out of the banking system. I wouldn't be in a hurry to put your money back in.

In the event of war or some other crisis, you can be sure bank vaults will be emptied..
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March 21, 2013, 08:59:25 PM
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The problem with using hardware is that it changes and it could fail due to heat or moisture or rust or...

Download vanitygen and create a public and private key.

Write them down or etch them into metal or stamp it into something, etc.

Send your BTC to the public address and you are all set.

You could even scratch the private key into a rock and bury it in your yard or whichever. Etch it into the foundation in your home. Carve it into the wall in the closet then cover with wall paper...

plenty of options for just saving a string of characters
No one method is failsafe.

Metal can be stolen or lost.
Locations of rocks can be forgotten, or they can be covered with a new supermarket 20 years from now.
Foundations can be destroyed in an earthquake.
Closet walls can be destroyed in a fire.

Bottom line is, I always make sure to store any Bitcoin backups of significant value in at least two ways, to protect against one of those failing.
tvbcof
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March 21, 2013, 09:14:43 PM
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...
Bottom line is, I always make sure to store any Bitcoin backups of significant value in at least two ways, to protect against one of those failing.

It's a legitimate argument that multiple backup/deep-store techniques create multiple failure modes as well.  I won't argue on way or the other.

One's security regime is a personal choice.  Probably the best advice would be to simply understand Bitcoin (or whatever) well then tailor a solution which fits one's situation.  And then keep one's mouth mainly shut about it.


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March 21, 2013, 09:17:42 PM
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...
Bottom line is, I always make sure to store any Bitcoin backups of significant value in at least two ways, to protect against one of those failing.

It's a legitimate argument that multiple backup/deep-store techniques create multiple failure modes as well.  I won't argue on way or the other.

One's security regime is a personal choice.  Probably the best advice would be to simply understand Bitcoin (or whatever) well then tailor a solution which fits one's situation.  And then keep one's mouth mainly shut about it.


Heh, this is key too.  Security through obscurity DOES have merit (just maybe not in computer code).
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