Questions about Bitcoin

[vicktorcapital]

Hi all, I am new to the Bitcoin community. I was fascinated by the idea of Bitcoin and would like to learn more about it. I have done some research on Bitcoin and trying to catch up with the development of it.

Throughout the research, 2 questions arose -

1) it seems that Bitcoin is not easy to keep (for instance, Mt. Gox case consolidate my thoughts.), so what is the safest way to store? I think 1 solution is cold storage, if so, how can I ensure its safety (ie no one copied my files) ?

2) Can Bitcoin implement "report lost system" and frozen the so call "suspicious Bitcoin"? That is a though from my friend (whose also new to the BTC world) and we were examine its plausibility so we would like to see advice.

Well, I might have misunderstand some keys/fundamentals about Bitcoin so feel free to point out and I am open to any suggestion !

Many Thanks,

[counter]

I don't want to give you the wrong info so I'll just answer one of your questions that you seem to already know the answer too.  Yes your best bet is to have your coins in cold storage.  And only use a computer that is not infected and you don't use for all kinds of things that might leave your coins vulnerable.

[durrrr]

is cold storage really the only way to be completly safe though? if i have a really good private key that should keep my coins safe in my desktop wallet right?

[S4VV4S]

is cold storage really the only way to be completly safe though? if i have a really good private key that should keep my coins safe in my desktop wallet right?

Not if you don't encrypt your Bitcoin directory/wallet - Talking about Windows here.

You can easily do that with just a few steps.

EDIT: As to the OP, read above. If you are using Windows either use Armory or encrypt your wallet and your Bitcoin directory.

[MashRinx]

Hi all, I am new to the Bitcoin community. I was fascinated by the idea of Bitcoin and would like to learn more about it. I have done some research on Bitcoin and trying to catch up with the development of it.

Throughout the research, 2 questions arose -

1) it seems that Bitcoin is not easy to keep (for instance, Mt. Gox case consolidate my thoughts.), so what is the safest way to store? I think 1 solution is cold storage, if so, how can I ensure its safety (ie no one copied my files) ?

2) Can Bitcoin implement "report lost system" and frozen the so call "suspicious Bitcoin"? That is a though from my friend (whose also new to the BTC world) and we were examine its plausibility so we would like to see advice.

Well, I might have misunderstand some keys/fundamentals about Bitcoin so feel free to point out and I am open to any suggestion !

Many Thanks,

Bitcoin is easy to keep.  It is also easy to lose if you are not careful.  Keeping any BTC in a wallet where you do not have full control of the private keys carries some risk, some more than others.  People who wouldn't hand their wallet to a neighbor have coins on exchanges run by someone whom they have no idea who they are, probably run in another country.  I don't get it.  Mt Gox had a reputation that was well-earned over multiple years.  Finally, the term "you got Goxed" was coined for a reason.  Mt Gox is not the only example.  AltCoin exchanges have had issues recently too.  Move your coins in, trade them, move the coins back out and you limit your risk.

Regarding your friend's question, that has been discussed several times on the forum.  You'll probably be able to find a few threads with a forum search.

[durrrr]

is cold storage really the only way to be completly safe though? if i have a really good private key that should keep my coins safe in my desktop wallet right?

Not if you don't encrypt your Bitcoin directory/wallet - Talking about Windows here.

You can easily do that with just a few steps.

EDIT: As to the OP, read above. If you are using Windows either use Armory or encrypt your wallet and your Bitcoin directory.

how would i encrypt my wallet and what is armory. i have windows. and i use a passphrase with my wallet.

[S4VV4S]

is cold storage really the only way to be completly safe though? if i have a really good private key that should keep my coins safe in my desktop wallet right?

Not if you don't encrypt your Bitcoin directory/wallet - Talking about Windows here.

You can easily do that with just a few steps.

EDIT: As to the OP, read above. If you are using Windows either use Armory or encrypt your wallet and your Bitcoin directory.

how would i encrypt my wallet and what is armory. i have windows. and i use a passphrase with my wallet.

Armory: https://bitcoinarmory.com/

You can encrypt part(s) of your hard drive(s) (as separate encrypted drives) using TrueCrypt (Free) or paid software such as FolderLock.

All you have to do is transfer your bitcoin directory (found in the users/appdata/roaming folder) to the encrypted drive and create a shortcut/batch file that starts the Bitcoin client but loads all data from the encrypted drive.

EDIT: IF you decide to go with the latter, make tests that your encrypted Bitcoin folder works and delete the original.

EDIT 2: ALWAYS make backups of your wallet.dat

[DannyHamilton]

1) it seems that Bitcoin is not easy to keep (for instance, Mt. Gox case consolidate my thoughts.), so what is the safest way to store?

Like any money, Bitcoin is easy to keep if you are careful, and easy to lose if you are careless.

I think 1 solution is cold storage, if so, how can I ensure its safety (ie no one copied my files) ?

Armory offline, Electrum offline, and paper wallets are all good options for high security against theft.

Honestly though, if you have a clean install of a modern operating system, and you use reasonable efforts to avoid malware on your computer, any of the commonly used wallets with a strong password will be sufficient protection for any daily use amount of bitcoins.

2) Can Bitcoin implement "report lost system" and frozen the so call "suspicious Bitcoin"? That is a though from my friend (whose also new to the BTC world) and we were examine its plausibility so we would like to see advice.

No.  Bitcoin is a decentralized system with nobody "in charge" that could make the final decision as to which reports were malicious and which were legitimate.  Therefore, it will be nearly impossible to ever reach the necessary consensus to change the protocol to make freezing someone's bitcoins possible.

[ebliever]

No.  Bitcoin is a decentralized system with nobody "in charge" that could make the final decision as to which reports were malicious and which were legitimate.  Therefore, it will be nearly impossible to every reach the necessary consensus to change the protocol to make freezing someone's bitcoins possible.

Right. With no central authority, how would anyone know you are the victim of a crime, or are perpretrating a crime by purchasing something with bitcoins and then yelling "thief" at the recipient of the bitcoins? It could be (and bloody well would be based on universal experience around here) massively abused.

[odolvlobo]

You don't have to keep your coins in cold storage.

Just keep them in your own wallet and not in somebody else's wallet. There are many choices -- Multibit, Electrum, Hive, Armory, Mycelium, Bitcoin-qt, blockchain.info, Android, etc. Encrypt your wallet if it isn't encrypted automatically, and back it up.

You will be fine.

[The_Gloomfrost]

1) ^ what he said. You don't NEED cold storage. For convenience, if you know you have a clean computer, and by know I mean you are CERTAIN it isn't infected with anything; you can just run your own wallet on there. Blockchain.info is another great solution. Remember that you only hear the 1% of actual bitcoin users when they 'get hacked' or whatever. I guarantee the other 99% aren't using cold storage, and they're fine.

2) Doing so would undermine the fungibility of bitcoins and destroy bitcoin as a whole. It IS possible with the protocol in theory, but it will never be done. Feel free to start your own alt-coin where you can destroy people's coins at will and see how far you'll get. Remember that even 'stolen' coins make their way back into the economy, so although I got paid for my services in dirty money, I may not know that. If suddenly that money disappears, it will be very unjust. This by the way, isn't any different from the real world. Stolen cash is used as real cash.

[vicktorcapital]

Hi all,

Thanks for the reply. I am grateful to hear a lot of fruitful thoughts and the replies made me understand more about bitcoin.

Well, as some of the reply mention. Bitcoin is decentralize so report system will deteriorate the idea. That is the first thought on my mind as well. But my friend insist one day they might implement such system (oh well he is a tradition monetarist, lol). But I agree with others and think it is not going to happen (at least, in the near future).

Regarding to the storage problem. I guess cold storage would be the best method for now. I guess with the aid of good securities I can keep my coin safe and sound.

Regards,

[gustav]

Hi all, I am new to the Bitcoin community. I was fascinated by the idea of Bitcoin and would like to learn more about it. I have done some research on Bitcoin and trying to catch up with the development of it.

Throughout the research, 2 questions arose -

1) it seems that Bitcoin is not easy to keep (for instance, Mt. Gox case consolidate my thoughts.), so what is the safest way to store? I think 1 solution is cold storage, if so, how can I ensure its safety (ie no one copied my files) ?

2) Can Bitcoin implement "report lost system" and frozen the so call "suspicious Bitcoin"? That is a though from my friend (whose also new to the BTC world) and we were examine its plausibility so we would like to see advice.

Well, I might have misunderstand some keys/fundamentals about Bitcoin so feel free to point out and I am open to any suggestion !

Many Thanks,

1: disconnect from the internet. Set up a new wallet, encrypt it, then store it offline. You don't need to connect it even once to send btc to that adress. To improve security you can use encrypted filecontainers to store important walletfiles. It all comes down to you having a system free of any malware. If you can make sure your computer is clean you are safe. Bitcoin is easy to keep if you know how to secure your computer. Mt Gox was not hacked - Karpeles just lost his mind, that's all. It is absolutely possible to keep btc 100% safe. For maximum security only use bitcoin-qt from trusted downloadsources and no third party software. You can also use paperwallets or just write down the privatekey yourself taken directly from the qt if you don't want to trust paperwallet-providers. Linux should be better than microsoftproducts. There are many ways to secure the coins really. You really only need to learn how bitcoin-qt works.

2: would arise a lot of problems. Who decides on what funds to freeze? Theoretically possible but not very likely to be implemented in the near future. 

[huishipai]

Hi everyone
it seems that i have a little knowledge of bitcoins transactions based on what i've read above. What is a cold storage? What is encrypting? Do we have a thread here where I can read all of this stuff. Sorry Newbie here and new in btc either. Thanks for helping in advance.

[gustav]

Hi everyone
it seems that i have a little knowledge of bitcoins transactions based on what i've read above. What is a cold storage? What is encrypting? Do we have a thread here where I can read all of this stuff. Sorry Newbie here and new in btc either. Thanks for helping in advance.

'encrypt wallet' is a feature in bitcoin-qt. Coldstorage means having your wallet offline (not connected to the internet) and in some cases storing bitcoin on a wallet that has never been online.

generally use the search-function or google if you need to know stuff.