How do you separate your everyday Bitcoin setup from long-term storage?

[Chinesebaby]

There seems to be a misunderstanding, what I meant was that you shouldn't combine your hodling (long term) bags + your everyday Bitcoin use (I wasn't speaking about not combining both types of wallet as I have no issues with that but only gave a scenario to protect your long term stash).

You do actually have a point on the very statement you just said above and I agree with it hundred percent, because combining both funds in one wallet might literally just tempt you one day into tampering with your long term Bitcoin savings. And in other to avoid such scenario, that's why it's just best just separate your Bitcoin that is meant for daily usage and the one that is meant to be invested and kept for a longer period, irrespective of the amount involved.

If you are holding Bitcoin investment for the long term, you can certainly use emergency funds, but in this case, you can use Bitcoin exchange for daily expenses rather than keeping hot quality. This will save you money, because if you can spend more on daily use of domestic currency,

But keeping Bitcoin meant for daily usage on an exchange is still not the best approach to protecting your funds, despite the fact that it allows you to easily convert the Bitcoin into fiat with the use of fiat. Because for me, I think it's just best you keep the daily Bitcoin on a non custodial wallets and just send it to an email exchange for selling anytime I have need for fiat. As this method will still grant me full control over my Bitcoin.

[Abu-Naim]

But keeping Bitcoin meant for daily usage on an exchange is still not the best approach to protecting your funds, despite the fact that it allows you to easily convert the Bitcoin into fiat with the use of fiat. Because for me, I think it's just best you keep the daily Bitcoin on a non custodial wallets and just send it to an email exchange for selling anytime I have need for fiat. As this method will still grant me full control over my Bitcoin.

If you want to hold Bitcoin for long, the security of your wallet is very important, and we have all agreed that keeping our seed phrases safe offline is the best strategy to hold your Bitcoin in your wallets that your seed phrase is saved offline. Meanwhile if you have Bitcoin that you can be using most often, you can hold them in your non-custodial wallet, but if you will often use it by converting it to fiat, you would rather use a centralized exchange to hold the little amount of bitcoin you can usually use because living it in your non-custody wallet can expose you since you will always use your seed phrase to login into the wallet, and it will have access to internet, therefore, in my opinion, saving should be gold in such wallet, while the once that can be used anytime you will need to trade or convert to fiat.

[Lida93]

keep most BTC in cold storage and only a small amount in a hot wallet for regular use.
For the online side, I also keep Bitcoin-related logins and sessions separate from my normal browsing. Sometimes I use separate browser profiles or an antidetect browser for that.
How far do you guys separate everything before it starts becoming overkill?

If you are holding Bitcoin investment for the long term, you can certainly use emergency funds, but in this case, you can use Bitcoin exchange for daily expenses rather than keeping hot quality. This will save you money, because if you can spend more on daily use of domestic currency, it will be better for you.

It's preferable to go with what the OP suggested about having our daily expense funds in the hot wallet, instead of leaving it in a centralized exchange as you recommending, all for the reason of avoid transactions fees and what appears to be stress for some people having to transfer funds from their open source hot wallet to exchange for immediate use.  For me I rather pay the transaction fee which isn't any significant compared to the possible risk of leaving it in an exchange.

[Cookdata]

How far do you guys separate everything before it starts becoming overkill?

Ordinarily, some person split their Bitcoin into several wallets, inorder to reduce the risk of losing all in one time, and it is very commendable to make it a practice. If you cannot use cold storage or use it correctly, splitting your Bitcoin is a good option, every possible option is a good option as long it reduces the risks of losing your assets, nothing is worse than losing so much that you've invested.

Why split your coins when they are protected under 1 seed phrase. I don't think anyone can get access to any of your wallet if they don't have access to your seed phrase and if they should get it, consider your wallet sweep the moment they get access to it. I don't know how you plan on doing this except if you want to use a separate keys which is even the worse way to protect your keys. This does not guarantee any security of your coins until you make sure your seed phrase is well protected.

There are security practice that are not options but a mandatory practice for everyone to do. There is nothing like if you can't do cold wallet, you should do it. In fact, the best thing you should do for your safety and if you want to be spending some once in a while, a hot wallet with small balance is not bad, this is the best way you can for long term storage and everyday spending wallet.

[Livingleged]

But keeping Bitcoin meant for daily usage on an exchange is still not the best approach to protecting your funds, despite the fact that it allows you to easily convert the Bitcoin into fiat with the use of fiat. Because for me, I think it's just best you keep the daily Bitcoin on a non custodial wallets and just send it to an email exchange for selling anytime I have need for fiat. As this method will still grant me full control over my Bitcoin.

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

[EluguHcman]

keep most BTC in cold storage and only a small amount in a hot wallet for regular use.

I don't really fancy the ideal of holding Bitcoin in the hot wallets because you may have it there believing you are not going to keep it longer there before you use it because it takes scammers seconds to wipe of wallets. That is if they could get through it while hot wallets will also be vulnerable for hackers due to its on-line wallet resident.

For the online side, I also keep Bitcoin-related logins and sessions separate from my normal browsing. Sometimes I use separate browser profiles or an antidetect browser for that.

Do you mean you store your pass phrase on-line? It is not news anymore that some beginners don't know the risk implications of stories your Privacy on-line.
It is as risky that your device privacy can be broken by malwares to steal your data and scammers uses it to steal your funds.

[Dave1]

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

That is, if you are at trader, but if not, then it's not good to put your funds on exchanges, just recently, Kraken Hit by 12,000 Dust Deposits From HTX-Linked Wallet, Accounts Temporarily Frozen. So if by chance your address is one of those that are affected, then you account can be frozen by the exchanges.

So it's better to still put your coins in a wallet that you have the control of the private keys. Maybe it's a multi crypto currency or Bitcoin only wallet. So that you can avoid this kind of issues as it is really inconvenience in our part.

[avp2306]

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

That is, if you are at trader, but if not, then it's not good to put your funds on exchanges, just recently, Kraken Hit by 12,000 Dust Deposits From HTX-Linked Wallet, Accounts Temporarily Frozen. So if by chance your address is one of those that are affected, then you account can be frozen by the exchanges.

So it's better to still put your coins in a wallet that you have the control of the private keys. Maybe it's a multi crypto currency or Bitcoin only wallet. So that you can avoid this kind of issues as it is really inconvenience in our part.

If they are not really so active doing trade and their intention is to hold their Bitcoin. Exchange is not the best platform to use, because they don't have any control on situation happening to those platform.

Kraken freezing situation is good example that even if they are not affected with those hacking issue. Still there are people got affected due to funds locking, imagine the inconvenience brought by that situation and I'm sure all of us here don't want to experience that.

So best approach is actually those thing what you have said here. Use self custody wallet, so that they have full control of their private keys. With this they will not get bothered account freezing and anything that can possibly give them stress.

[Tamaperdana]

Snip

Personally, I clearly distinguish between Bitcoin specifically for investment and Bitcoin that isn't. But mostly, I keep my Bitcoin for the long term, so sometimes that's all. But if I want to make small trades just for fun, I sometimes like to buy Bitcoin to trade. But after that, I'll also put the Bitcoin in a wallet to hold it long-term. Yes, that's what I do, because basically, what you mean by daily use here, for me, yes, maybe just trading.

Because in the country where I live, I rarely transact with anyone using Bitcoin. Because here, there are very few people who know or own Bitcoin. So, transacting with Bitcoin is simply not possible here. As for wallets, I often use a hot wallet for now. But that's only when I'm sending Bitcoin. Then,, after I see the Bitcoin I sent has entered my wallet, I immediately delete the wallet application. So, my Bitcoin wallet is not connected to the internet, so I think it's safer.

[uchegod-21]

But keeping Bitcoin meant for daily usage on an exchange is still not the best approach to protecting your funds, despite the fact that it allows you to easily convert the Bitcoin into fiat with the use of fiat. Because for me, I think it's just best you keep the daily Bitcoin on a non custodial wallets and just send it to an email exchange for selling anytime I have need for fiat. As this method will still grant me full control over my Bitcoin.

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

The bitcoins which will be kept on the exchange,  will it really be used for daily transactions as you said? If that is the case, then I too wouldn't mind. But, you must never put more than you can afford to lose there.

Another thing is, while saving regular bitcoins on the exchange for daily transactions as you have claimed, you must not also be tempted to leave a huge amount of bitcoin there. Since you have successfully used the exchange for a long time without any issues, it should never be a reason to be too comfortable and put large bitcoins there. One time mistake could lead to long term regrets.

[Dave1]

If they are not really so active doing trade and their intention is to hold their Bitcoin. Exchange is not the best platform to use, because they don't have any control on situation happening to those platform.

Kraken freezing situation is good example that even if they are not affected with those hacking issue. Still there are people got affected due to funds locking, imagine the inconvenience brought by that situation and I'm sure all of us here don't want to experience that.

So best approach is actually those thing what you have said here. Use self custody wallet, so that they have full control of their private keys. With this they will not get bothered account freezing and anything that can possibly give them stress.

Yes, that's why I try to show that example that it's not good to hold our Bitcoin specially if you have big amounts of it in any exchange. And even if you have passed the KYC and you think you are safe, then think again as they have the all the power to freeze.

And then they can also subject you to more KYC in the future if they think that you might be doing some bad things (without proof), like money laundering and others. Although we have the case of Coldcard incident, I think still better to get a hardware wallet for your custody but practice security and safety.

[reagansimms]

keep most BTC in cold storage and only a small amount in a hot wallet for regular use.

For the online side, I also keep Bitcoin-related logins and sessions separate from my normal browsing. Sometimes I use separate browser profiles or an antidetect browser for that.

How far do you guys separate everything before it starts becoming overkill?

Everyone needs to keep their assets safe. But imo the best security isn’t the most complicated one. It’s the one you can actually stick to without creating new ways to mess up. Honestly, cold storage and a separate browser profile is already more than enough. Adding an anti-detect browser just adds extra risk and headaches for no reason if you’re an individual. At the end of the day, Bitcoin security comes down to keeping your cold storage keys offline and air-gapped. Not how fancy your daily browser is.

Not saying your method is bad btw. But making things too complex just means you’re more likely to screw up and lose access yourself, instead of getting hacked. What you’re doing now is solid. Cold storage for the big stack, separate browser for daily stuff. That’s already great security.

[Ab de villiers]

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

Having your funds on exchanges is always a risky job even if you are doing this for your daily use because anytime anything can happen and you can face consequences. Always safety first, which will always keep you on good footing. I am also doing a few things for long term investment and also need funds for my daily use, but I am keeping my funds in my wallet where things are always easy to manage. I do exchange and withdraw quickly from exchanges because now I am not trusting them for anything in the long run; I am always using precautions. Recently there have been too many issues with data leaks and others making things terrible for people because they are losing their confidence, but still having your control of money is good because this will give all peace of mind.

[Crytohillss]

But keeping Bitcoin meant for daily usage on an exchange is still not the best approach to protecting your funds, despite the fact that it allows you to easily convert the Bitcoin into fiat with the use of fiat. Because for me, I think it's just best you keep the daily Bitcoin on a non custodial wallets and just send it to an email exchange for selling anytime I have need for fiat. As this method will still grant me full control over my Bitcoin.

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

Absolutely, if it is funds one uses steady in allocating good amount in one's exchange will be more preferable than amount people save from unnecessary pressure giving by the network fees the problems is understanding how on are contented the daily needs are not that much big will worries too much about our exchange sometimes most people has their own usage fund base their personal understanding and the small knowledge they have keeping our funds save despite the when one move his coin to custodia wallet I think that's the only we can save guard our Bitcoin investment.

[Baki202]

For daily use it’s very much okay to have your funds on the exchanges, this will definitely save you from charges that you me be paying when you want to move coins from the non custodian wallet regularly. daily used are not that huge, and are even better at the exchange actually, we worry too much about the exchange but most of us still have our daily usage funds there, who is now fooling who?
I understand that you want total control but every one has their opinion, and I’m just saying based on personal experience and little observation I’ve made from the few people around me.

It is preferable to be able to simply put what you want to spend in an exchange so that you don't have to spend what you intend to hold already. One benefit of leaving your spending in Bitcoin is that there is a good chance that it will increase. Another benefit is that you must keep in mind that the moment the market declines, your money will likewise decline; this is what we need to understand, so you will have to prepare for any eventuality so that you can swap whenever you want once you have it in an exchange.

You can see that when it comes to strategy, we are constantly learning because there is a greater chance that we will find a way to keep some. However, it is crucial to remember that strategy is a matter of choice; you don't have to follow everyone else's lead in order to ensure that you are doing what will be beneficial.

We share the same viewpoint because, given the current state of affairs, it will be preferable for children to be able to make their own decisions, just as we have freedom of expression and freedom of choice.

[promise444c5]

Another benefit is that you must keep in mind that the moment the market declines, your money will likewise decline; this is what we need to understand, so you will have to prepare for any eventuality so that you can swap whenever you want once you have it in an exchange.

So you knew  the money you are trying to spend is likely to be subjected to decline , why did you typed this :

“ One benefit of leaving your spending in Bitcoin is that there is a good chance that it will increase” and the fact you mentioned “good chance” is somehow misleading..

Putting the funds you are going to spend anytime soon in Bitcoin is more of a bad idea.. if you’re going to invest , then make it an investment .

If it’s what you’re keeping to spend anytime then it’s  much better you keep it in fiat or somewhere where you can easily spend without worrying about the market conditions.  

You can’t predict Bitcoin so putting everything [including what you’re not investing] in Bitcoin seem like a perfect way to  loose some money because you will be forced to withdraw part of your investment if you need that money when the market is not in a good condition.

[joniboini]

It is preferable to be able to simply put what you want to spend in an exchange so that you don't have to spend what you intend to hold already.

Is "spending" here limited to swapping to fiat? If I'm buying VPN subscription with Bitcoin it doesn't seem to offer any benefit. Regardless of that though, saying that we should leave some coins on exchange to save fees seems a bit careless. It isn't that difficult to separate your coins into multiple wallets or devices if you wanted to. Fees only takes a fraction of your transaction. Unless you're a day trader where you can move lots of funds each day (which assume the majority isn't).

[YellowSwap]

keep most BTC in cold storage and only a small amount in a hot wallet for regular use.

For the online side, I also keep Bitcoin-related logins and sessions separate from my normal browsing. Sometimes I use separate browser profiles or an antidetect browser for that.

How far do you guys separate everything before it starts becoming overkill?

What is your regular use OP that makes you leave some coins in a hot wallet? I really want to know this because many people got it wrong, if you aren't buying and selling every day it makes no sense to leave some coins in your hot wallet.

I only use my hot wallet for online purchases, and this is something that I don't do all the time, most of the times my hot wallet is always empty.

Even if I find something I need to buy online I will have to use my hardware wallet to fund my hot wallet and initiate the transaction.

[Rikafip]

Is "spending" here limited to swapping to fiat? If I'm buying VPN subscription with Bitcoin it doesn't seem to offer any benefit.

Depends on the VPN you are using. For example, I am using Mullvad (imo, one of the best ones on the market) and they offer 10% discount if you pay with bitcoin (and few other cryptocurrencies).

But even without that discount, I would never use my debit card and reveal my identity (unless you are using one of those nonKYC ones) to buy something like that, or IPTV (another thing I use only bitcoin for paying).

[Coyster]

What is your regular use OP that makes you leave some coins in a hot wallet? I really want to know this because many people got it wrong, if you aren't buying and selling every day it makes no sense to leave some coins in your hot wallet.

There is absolutely nothing wrong in leaving a small amount of bitcoin in a hot wallet. Doesn't matter if you're not going to spend it in the next few weeks, as long as it is a small amount you can afford to lose, then that is okay.

I do not like to interact with my cold wallet too often and many people also feel the same way, so it would be uncomfortable for me to have to send funds from my cold wallet whenever i need to spend crypto. A better approach for me would be to fund my hot wallet with a month's worth of coins, which is obviously still a small amount and many times it would last way longer than that.