Security / Be Careful What & Where You Backup

[DaveF]

So, for those of you who use Windows and some of the free / cheap backup software that is out there. Be aware that some products are backing up your C:\Users\username\AppData\Roaming folder which has your wallet.dat file in there.

I have seen 2 people that had their wallet.dat files in the cloud.

In theory all these places claim that your data is secure and nobody but you can access it.
In reality who knows.

Be aware. Be careful.

-Dave

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[Chris!]

Good tips. I've never really trusted any backup unless it's air-gapped. You can't beat printing it out for security.

[Jet Cash]

I don't use any cloud services. USB hard drives are so cheap now, and there are SD cards as well.

[bitmover]

I don't use any cloud services. USB hard drives are so cheap now, and there are SD cards as well.

Recently, someone entered into my house and stole my notebook and my external harddrive... it was very sad, i lost some things but not much , as I had almost everything backed up in cloud services.

I believe non sensitve information such as pictures, documents, etc should always be backed up in cloud AND drives.

Sensitive information such as private keys should be backed up in piece of paper, offline.

[o_e_l_e_o]

You can't beat printing it out for security.

You can - writing it down. There exists malware which can run on printers and provide 3rd parties with details of what you are printing. If that includes your mnemonic phrase or private key, then you can say goodbye to your coins.

Recently, someone entered into my house and stole my notebook and my external harddrive... it was very sad, i lost some things but not much , as I had almost everything backed up in cloud services.

You need to use off-site back up. Yes, that could be cloud storage, but frankly, given the alarming regularity which we see cloud storage being hacked, I don't trust them. As Jet Cash has said, physical storage is very cheap. I'd much rather encrypt the data myself, load it on to a USB, and physically store that off site, than I would trust a third party with my data.

[jackg]

Even though hardbdrives are really cheap (I have quite a few) it's still a good idea to get somewhere external to store everything.

If you're backups are in your one house then there's clearly a problem... What happens if your house goes up in flames, if your seed is in your pocket it can fall out while you try to leave.

If you follow the password recommendations from anywhere reliable and upload to cloud storage (with double or triple) strong passwords, you can secure your seeds and keys quite well. Alternatively you could burry a hard drive - which will also reduce electromagnetic exposure unless energy lines are underground - or give it to a friend or relative you trust but most people on here seem to have relatives that will kill for their money...


I do keep memorising seeds as I have to recover them on the same machine and I don't think that's too secure either due to then $5 wrench problem...

[o_e_l_e_o]

or give it to a friend or relative you trust but most people on here seem to have relatives that will kill for their money.

Haha, this always seems weird to me whenever threads about security are opened. People talk about using dead man's switches or multi-sig wallets shared among relatives or friends so their next of kin will be able to access their funds if they die. My back up is that my wife knows all my wallets and how to access them. I mean, we sleep in the same bed every night. If she really wanted to do damage to me, crypto would be the least of my concerns . I also have a handful of friends I would completely trust with my life, including all my assets, and not doubt for a second I would get them back in full.

I'm all for not trusting third parties, web wallets, exchanges, and the like, but everyone should be able to trust at least one or two close friends or relatives.

[jackg]

or give it to a friend or relative you trust but most people on here seem to have relatives that will kill for their money.

Haha, this always seems weird to me whenever threads about security are opened. People talk about using dead man's switches or multi-sig wallets shared among relatives or friends so their next of kin will be able to access their funds if they die. My back up is that my wife knows all my wallets and how to access them. I mean, we sleep in the same bed every night. If she really wanted to do damage to me, crypto would be the least of my concerns . I also have a handful of friends I would completely trust with my life, including all my assets, and not doubt for a second I would get them back in full.

I'm all for not trusting third parties, web wallets, exchanges, and the like, but everyone should be able to trust at least one or two close friends or relatives.

I'm similar, I use friends and family to store physical bitcoins.
If my sister gets ahold of one, she's more interested in counterfeiting it than she is in stealing it .

I have to watch where the relatives place them as the ones I use are probably more likely to forget where they've left them than anything...

Third parties bring it on themselves not to be trusted, no one runs a reliable trustworthy business that grows (there are a few family businesses that surprises but they're few and far between).

[joniboini]

I'm all for not trusting third parties, web wallets, exchanges, and the like, but everyone should be able to trust at least one or two close friends or relatives.

For someone who's always alone all their life, this can be quite difficult haha.

I use multiple back-ups with pretty much a strong password. As long as I don't get keylogged or phished, it should be safe. On top of that, I also encrypt it with a password that I never use or write when I'm online. Hopefully that's safe enough. And I don't use Windows to interact with my crypto, so hopefully, I don't lose my money.

[Chris!]

You can't beat printing it out for security.

You can - writing it down. There exists malware which can run on printers and provide 3rd parties with details of what you are printing. If that includes your mnemonic phrase or private key, then you can say goodbye to your coins.

Interesting. I guess not being able to use my new printer on a live USB is even more secure than I initially thought. Thanks!

[BitMaxz]

Interesting. I guess not being able to use my new printer on a live USB is even more secure than I initially thought. Thanks!

You can still use the printer but you must disconnect your computer to the internet forever to transfer the generated paper wallet you need a USB drive and transfer it to your offline computer to print.

Or burn a CD that includes your private keys and seeds as a safe alternative.

[Chris!]

Interesting. I guess not being able to use my new printer on a live USB is even more secure than I initially thought. Thanks!

You can still use the printer but you must disconnect your computer to the internet forever to transfer the generated paper wallet you need a USB drive and transfer it to your offline computer to print.

Or burn a CD that includes your private keys and seeds as a safe alternative.

Yeah no worries there. I only generate paper wallets on a live USB and only use my own entropy source. My only issue is that my printer's drivers don't work properly for me on a Linux Live USB so I've been writing things out instead.

I guess my only question would be if I'm printing something out on an air-gapped system, shut it down then boot up on another system, would malware within the printer be able to send off what I just sent on a live USB? I hope that makes sense.

[o_e_l_e_o]

I guess my only question would be if I'm printing something out on an air-gapped system, shut it down then boot up on another system, would malware within the printer be able to send off what I just sent on a live USB?

Likely? No. Possible? Absolutely.

All modern printers have memory which can be utilized by malware. Many mid to high end printers will automatically store copies of the last x number of documents which have been printed or scanned in their memory. If your printer has an option to reprint previous documents, or re-order documents in a print queue, then it is absolutely storing copies. This problem is compounded with printers which accept removable storage like USB drives or SD cards.

It is absolutely possible to write malware which will keep copies of what is being printed and scanned, with instructions to send them off when an internet connection is re-established. Booting your computer from a live USB offers protection from malware on your PC, but if the malware is on the printer, it doesn't really matter what you are doing with your computer.

[Chris!]

I guess my only question would be if I'm printing something out on an air-gapped system, shut it down then boot up on another system, would malware within the printer be able to send off what I just sent on a live USB?

Likely? No. Possible? Absolutely.

All modern printers have memory which can be utilized by malware. Many mid to high end printers will automatically store copies of the last x number of documents which have been printed or scanned in their memory. If your printer has an option to reprint previous documents, or re-order documents in a print queue, then it is absolutely storing copies. This problem is compounded with printers which accept removable storage like USB drives or SD cards.

It is absolutely possible to write malware which will keep copies of what is being printed and scanned, with instructions to send them off when an internet connection is re-established. Booting your computer from a live USB offers protection from malware on your PC, but if the malware is on the printer, it doesn't really matter what you are doing with your computer.

Yikes. I honestly never thought of that. I'll stop looking for a printing solution and continue writing out my private keys.

With that being said, how do people like storing funds long term? For me I roll dice for entropy, use a downloaded version of bitaddress.org to covert that to a private key then convert that to a bech32 address via segwitaddress.org (all offline on a live usb). Then write out the private keys.

I hear lots of people saying I should use a mnemonic seed phrase instead but I'm not sure how to generate that with my own entropy source. I see why it would make sense to use a mnemonic seed phrase, since it's human readable and less prone to error, but at the same time I've always understood that different wallets could always use different mnemonic seed phrase types so you can't rely on a seed phrase forever. Any idea which is right nowadays, or is it just personal preference at this point?

[jackg]

A lot of security stuff now is down to personal preference as long as you have something secure..

I used a 3 of 3 multisig with 2 seeds on my phone and 2 seeds on my computer which worked quite well (until I reached the 1kb limit electrum had on qr codes so I went and bought a trezor).

Using an air gapped computer or a live os is a good idea (for improved security, pull the hard drive out of your computer before putting the USB stick in - if possible).


Private keys and seeds both use 256 bits so in theory you can use the same key as a seed that you do for a private key (I know there are ways to import them I just can't think of one but there are quite a few pieces of software out there on github).

[o_e_l_e_o]

Yikes. I honestly never thought of that. I'll stop looking for a printing solution and continue writing out my private keys.

You could quite easily pick up an old second hand printer on the cheap to only ever use with your air gapped device. If it is never going to connect to a device with internet access, then any malware which may be on it is essentially nullified.

With that being said, how do people like storing funds long term? For me I roll dice for entropy, use a downloaded version of bitaddress.org to covert that to a private key then convert that to a bech32 address via segwitaddress.org (all offline on a live usb). Then write out the private keys.

Personally, I use a hardware wallet. Connect it as you are already doing to an air-gapped, clean, live USB device, create a new wallet, and it will generate a seed randomly and securely. Write down the mnemonic phrase it gives you as back-up. As long as you have your mnemonic phrase written down, you could even wipe the hardware wallet afterwards if you really wanted.

As long as you generate a phrase which complies with the BIP39 standard (which both Ledger and Trezor do), then there will always be a wallet available to import your phrase to in the future. Worst case scenario, you can manually use your phrase to work out your seed, and then take it from there.

[bob123]

I've always understood that different wallets could always use different mnemonic seed phrase types so you can't rely on a seed phrase forever. Any idea which is right nowadays, or is it just personal preference at this point?

For that reason there has been a standard created which has been implemented  by most wallets already.
BIP39 (https://github.com/bitcoin/bips/blob/master/bip-0039.mediawiki) covers the encoding of the seed into the mnemonic code.

It is highly likely that you will always be able to automatically recover your coins from a BIP39 mnemonic code. And if not, the standard can be read by anyone to recover the seed by hand.

Using an air gapped computer or a live os is a good idea (for improved security, pull the hard drive out of your computer before putting the USB stick in - if possible).

Unplugging the hard drive doesn't do anything for the security.

Since the hard drive isn't mounted at boot, there is no direct risk.
Even if you mount the hard drive, if you are using a windows PC and boot a live linux, there is almost no harm which can be done.

Upon boot, a clean OS is being loaded into the CPU / RAM. The harddrive is just some storage.

[naska21]

One more reason to not rely on cloud backup services   is that  they may keep  outdated wallet.dat .  If my memory serves me right,  on default, the capacity of keypool for BitcoinCore is equal to 1000. With each transaction you made the change goes to new address that reduce the number of available addresses in keepool. So if your spending are frequent you may find yourself in situation when the initial  keypool is depleted and  the "old" copy of wallet.dat  (backed by cloud)  does not  include new addresses.

[ranochigo]

One more reason to not rely on cloud backup services   is that  they may keep  outdated wallet.dat .  If my memory serves me right,  on default, the capacity of keypool for BitcoinCore is equal to 1000. With each transaction you made the change goes to new address that reduce the number of available addresses in keepool. So if your spending are frequent you may find yourself in situation when the initial  keypool is depleted and  the "old" copy of wallet.dat  (backed by cloud)  does not  include new addresses.

This is changed quite sometime ago with the introduction of HD wallet. While the wallet can still be run in the legacy mode without the HD function, it is even more dangerous with it being HD. Once the seed is compromised, the seed will remain the same for as long as you keep using the same wallet.dat file or your password is changed.

[DaveF]

Bumping this because it just came up again.
Also, be aware where your preferred wallet app is putting it's data file.
Running electrum as a stand alone app on your PC? It's putting a data folder on your desktop.
Did idrive / crashplan / mozy just backup your desktop to the cloud?

Did you password protect your wallet?

Paranoid is good.

-Dave