Paper Wallet

[fible1]

I'm not sure I understand this post: http://www.reddit.com/r/Bitcoin/comments/1c9xr7/psa_using_paper_wallets_understanding_change/

So basically, if you import a paper wallet and only spend some of the funds, the other funds in you paper wallet become inaccesible? What is this "change address' thing?

All info is much appreciated .

[1715202108]

1715202108

[Elwar]

When you spend from any address...it sends all of the bitcoins from that address, not just the small amount you want to spend.

It then returns your change to another address.

Sorta like spending $6 but only having a 10 dollar bill. You cannot just spend $6 of that $10. You get 4 new dollars.

I have run across this myself as I tend to keep most of my BTC in a single address. When I spend anything from that address it will return change to the wallet I am using in different addresses.

What I tend to do is then send the contents of my wallet to that address. That way it re-combines all of my BTC to that single address.

This is useful for long term storage of your bitcoins.

Treat your cold storage as you would a savings account or a CD. Keep a small amount of spending money in an online wallet (I usually keep 1 BTC or so in MtGox to spend when I need to).

[fible1]

When you spend from any address...it sends all of the bitcoins from that address, not just the small amount you want to spend.

It then returns your change to another address.

Sorta like spending $6 but only having a 10 dollar bill. You cannot just spend $6 of that $10. You get 4 new dollars.

I have run across this myself as I tend to keep most of my BTC in a single address. When I spend anything from that address it will return change to the wallet I am using in different addresses.

What I tend to do is then send the contents of my wallet to that address. That way it re-combines all of my BTC to that single address.

This is useful for long term storage of your bitcoins.

Treat your cold storage as you would a savings account or a CD. Keep a small amount of spending money in an online wallet (I usually keep 1 BTC or so in MtGox to spend when I need to).

Elwar,
  I appreciate you taking the time to answer me but I must admit I'm still not clear. Basically I want to know:

1. If I import my private key to bitcoinqt and I have 10 BTC in there and I only spend 3 BTC, will I then permanently loose access to the other 7 BTC?

2. Is the only solution to this to spend all my paper wallet coins to another wallet like blockchain.info and get organised from there?

Many thanks in advance .

[Elwar]

1. If I import my private key to bitcoinqt and I have 10 BTC in there and I only spend 3 BTC, will I then permanently loose access to the other 7 BTC?

When you spend that 3 out of 10 BTC from bitcoinqt, bitcoinqt will create a new address in your bitcoinqt wallet and the 7 BTC will be sent to that address. So now your bitcoinqt wallet will have 2 addresses, your original address and a new address with the 7 BTC (actually I think some of the BTC stays in your original address but I will not complicate things).

What you can then do is go back into bitcoinqt and send 7 BTC to your original address. You can then delete your wallet file if you want once the transfer goes through. You now have 7 BTC on your original address.

2. Is the only solution to this to spend all my paper wallet coins to another wallet like blockchain.info and get organised from there?

It would work the same as using your bitcoinqt.

But the point of having a paper wallet is mainly to keep your private key off of your computer and the Internet to avoid someone stealing it.

[fible1]

1. If I import my private key to bitcoinqt and I have 10 BTC in there and I only spend 3 BTC, will I then permanently loose access to the other 7 BTC?

When you spend that 3 out of 10 BTC from bitcoinqt, bitcoinqt will create a new address in your bitcoinqt wallet and the 7 BTC will be sent to that address. So now your bitcoinqt wallet will have 2 addresses, your original address and a new address with the 7 BTC (actually I think some of the BTC stays in your original address but I will not complicate things).

What you can then do is go back into bitcoinqt and send 7 BTC to your original address. You can then delete your wallet file if you want once the transfer goes through. You now have 7 BTC on your original address.

2. Is the only solution to this to spend all my paper wallet coins to another wallet like blockchain.info and get organised from there?

It would work the same as using your bitcoinqt.

But the point of having a paper wallet is mainly to keep your private key off of your computer and the Internet to avoid someone stealing it.

Elwar,
 Ok, so if I understand correctly, bitcoionqt will send the coins to a new address that I will have immediate access to on the qt app and basically clean out the paper wallet. So basically no coins are lost but the paper wallet address should be discarded Is that correct?

Thanks again .

Pablo.

[Elwar]

Elwar,
 Ok, so if I understand correctly, bitcoionqt will send the coins to a new address that I will have immediate access to on the qt app and basically clean out the paper wallet. So basically no coins are lost but the paper wallet address should be discarded Is that correct?

Thanks again .

Pablo.

Yes, you would have full access to all of your funds in the qt app.

If you send all of your funds back to the public address on your paper wallet you can continue to use it (just the same way you would send BTC to any other address). Or you could just use your bitcoinqt.

[wsoei]

I use Armory offline wallet.  Do I have to worry about losing BTC through the new change address?  I've only deposited.  I havent withdrawn any coins yet.

[Operatr]

You can think of your private key as you would a piece of paper fiat money. Once you spend it (withdraw funds from the paperwallet), it is gone. Probably not the best analogy but kind of.

Paper Wallets are meant as an offline hard store, which you can deposit to anytime (using the public address on the paperwallet, just a normal Bitcoin address), but you can only withdraw once (using the private key, hidden from view on the paperwallet in the form of a QR code and text key). After that the security of the paperwallet is compromised and should be considered destroyed. You can always make another one easily. This is why it is important if you withdraw your funds, you withdraw completely.

When you deposit Bitcoin to the wallet, the actual transaction lives in the blockchain, which is locked using your private key which only you possess. This means that the private key is like a key to a safe. To get access to the coin in your offline wallet, you must import the private key to a Bitcoin client, which is used to authenticate that the owner of the public address is in fact you, and your funds will be transferred to the client.


These public and private keys both exist in the Bitcoin client otherwise, leaving your wallet and information susceptible to viruses/keyloggers, computer problems (a hard drive crash could make you a poor man quickly!), etc. By extracting your private key in an offline form, or a paper wallet, you can keep your private keys safe as a physical asset, relying on the blockchain alone to store your Bitcoin until you withdraw them into a Bitcoin client for use. It is recommended when you generate your private keys for this that the computer itself be offline as well, ideally from a Live CD of somekind and not the usual operating system. This mitigates any possibility that your keys will be compromised by the host system from the start.  


Basically, if someone really wants your Bitcoin and you store most of your wealth offline this way as a savings account, that someone would have to come find you and physically take them, making them no different than breaking into a bank or your home physically to steal your money.

If you choose to store your fortune this way, be sure you get a fireproof physical safe or other secure means of storage to keep them in. You wouldn't just leave $1000s of physical dollars scattered around your house, Bitcoin wallets should be considered no differently.  

[pwi]

When you spend from any address...it sends all of the bitcoins from that address, not just the small amount you want to spend.

It then returns your change to another address.

Sorta like spending $6 but only having a 10 dollar bill. You cannot just spend $6 of that $10. You get 4 new dollars.

I have run across this myself as I tend to keep most of my BTC in a single address. When I spend anything from that address it will return change to the wallet I am using in different addresses.

What I tend to do is then send the contents of my wallet to that address. That way it re-combines all of my BTC to that single address.

This is useful for long term storage of your bitcoins.

Treat your cold storage as you would a savings account or a CD. Keep a small amount of spending money in an online wallet (I usually keep 1 BTC or so in MtGox to spend when I need to).

I like how you just explained this.  It just may be the best English explanation of how to both use and apply Bitcoin to a regular life.  However, I'd chose somewhere else other than gox to store my spending money unless I wanted to be burglarized by the US alphabet soup.

[fible1]

I think I got it .

Much appreciated to everyone .

Pablo.

[Haole]

I hope you don't mind me using your thread fible but Ive been trying to get an answer to a stupid n00b question I have.  Thanks for asking and getting clarification on your topic though, it will help others like myself...

To my question:

Is there any difference between a 51 character base 58 private key and a 52 character base 58 private key for the purposes of importing any given private key into a client (Bitcoin-Qt in my case) or web-based wallet?  I have my paper wallets recorded in 52 character codes but have noticed that at least one of the fine paper wallet generators out there outputs to 51 character code private keys.  Is there any difference for the purposes of broad functionality?  Thanks