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Author Topic: Ledger and buy/sell noob  (Read 397 times)
andyroo
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October 01, 2017, 10:33:27 PM
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Hi guys,

Firstly, thanks to anyone who replies with their expertise in this, it is much appreciated for a 'not-so-tech-savvy' bloke like myself.

I am new to the Crypto game and the first thing I learned was  is that security is key. So I purchased a Ledger Nano S. I am realising that there is still a lot to learn in regards to moving these bitcoins around, so I was hoping to have some questions answered.

I currently have btc and other altcoins on a couple of separate exchanges. IE: Coinspot and Independent Reserve (They are Australian).

They told me that I can transfer to my ledger nano s no problem from their 'site wallets'. But I know there is a conflict with private and public keys.

1. So my first question is, can I simply transfer from both exchanges or wallets to my hardware wallet without needing to reset after each download, or without risk of losing what is currently stored on there from say ,coinspot, then it gets lost when I download what is on independent reserve to my hardware wallet? I mean what if even I downloaded btc from 7 exchanges all with the same ledger, same code and never resetting it?

2. In addition to this I am curious about how seeding will work. I was told that if you have a paper wallet that you only 'seed' once, meaning you unload all your coins from the paper wallet because then after that it is not safe. Does that go the same for my ledger nano s? If I unload some coins onto a website, are the remaining coins on my ledger not safe?

3. My last question seems silly but perhaps it isn't. If I plan on buying and putting the ledger nano S away in a safe to gather dust for 40 years, what safety is there for that? I mean perhaps computers wont even take USB by then, or the software degrades, or ledger nano companies dies so my ability to reclaim via my hidden seed is gone? Any clarity with this would help.

Again, thanks for anyone who takes to time to explain this Smiley

Andy.
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October 01, 2017, 10:42:39 PM
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1. Yes, you don't have to reset it. You can't import your private keys to Ledger so you will have to withdraw your funds from an exchange. When you connect your Ledger and choose account, there is a "Receive" button. Copy address from there and paste it into exchange. Every time you receive payment, address changes. However you can reuse them because they are generated from your private keys.

2. Your private keys are generated from seed which is always given at startup. You can't unload your coins because they are already there.

3. We can't predict what will happen to your device. There are a lot of factors such as dust, moisture and weather. It should work fine but try to backup your seed. Encrypted photo or txt file will be enough.

andyroo
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October 01, 2017, 11:32:01 PM
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Thanks for the reply.

I had one final question. I am more curious about this importing/seeding to my hardware wallet. So my coins are currently on excchanges or their exchange wallets of my account. They said all I need to do is withdraw from my account on the exchange to my hardware wallet and then I control the private key.

I asked all three exchanges if they import or seed and they pretty much all gave me the same asnwer saying I only needed to withdraw to my ledger and I was the owner OR once I withdrew from the exchange I was the owner.

But what I really wanted to know was, once I withdraw to my hardware wallet, how do I know they have not written down the private key attached to those bitcoins? or that they keep it stored on their servers?

This could be a misunderstanding on my part but trying to get my head around it and feel less anxiety about buying these coins and storing them and some dude and hording everyones private keys waiting for 10 years to get rich.

Thanks!
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October 02, 2017, 05:40:35 AM
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Bitcoins "belong" to private keys... Not the other way around.

So when you transfer from one Bitcoin address to another, you are effectively reassigning ownership/control of those coins from one private key to another (Bitcoin address and private key have a 1 to 1 relationship). So it doesn't matter that the exchange has a private key, as that key no longer controls those coins. YOUR private key dies.

Due to the use of "one way hash functions", there is no way to derive a private key from a Public Bitcoin address. You can only start with a private key and derive a public Bitcoin address.

So, once you "withdraw" from the exchange... This transfers the ownership of the Bitcoins from the exchange address to your address (controlled by your private key)...

Your private key is safely secured on your hardware wallet and NEVER leaves it... It is NEVER exposed to the outside world... That's the whole point of hardware wallets Wink

Also, your protection against hardware device failure (or USB no longer existing) is your 24 word seed that the device generates during setup and which you wrote down and stored in a nice secure/safe place (you did that right? Wink)... Those 24 words are able to regenerate your whole wallet... They're effectively your private keys stored in an easy to copy format... The algorithms and methods to go from 24 words to private keys are open source and widely known and there are plenty of other sources that will do this, like: https://iancoleman.github.io/bip39/

Never give them to anyone and NEVER store them on a computer unless they're strongly encrypted. Wink


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October 02, 2017, 05:45:59 AM
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Thanks. That answers my questions. Really appreciate it Smiley. Good bitting!
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