Losing my Bitcoins

[Gareth Nelson]

If the above sounds silly, my basic point is this:

The only way to be 100% secure is to not give your key to anyone else, ever and only decrypt on your own machine.
Doing so would also prevent theft in the first place - as soon as your computer is turned off, the plaintext wallet disappears from RAM.

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[Maged]

Ok, now the service provider is honest but the thief is very clever and waits for that window between you giving the key to the service provider and them running the transaction

How would a thief know when you give the service your key?

[Gareth Nelson]

This is getting silly now, but it's for those with sufficient paranoia:

Network sniffers

[Yurock]

Clever thief wants to lead any investigations away from him and onto the innocent 3rd party

There are better ways to launder stolen bitcoins. And if the thief will be caught, he will be prosecuted anyway in most cases.

The only way to be 100% secure is to not give your key to anyone else, ever and only decrypt on your own machine.

I assume that my data is never 100% secure, because any today's computer system is way too complex to be absolutely sure about anything. But of course, such practices, combined with strong passwords, can make you at least 99.99% sure.

[Gareth Nelson]

Generally, if you encrypt sensitive data (such as wallet.dat) and only store the plaintext version in RAM then with a good implementation you should stay secure for a long time - by giving it to someone else you open up the security risks massively.

[berlin]

One word of warning: do regular backups OR use a different "savings account" type setup, there can be issues if you try to restore an old backup directly.

Ideal setup is to have a wallet.dat with a single address generated offline, backup and encrypt it then send any spare bitcoins there. Your day-to-day stuff should be backed up roughly every 10 transactions.

Could you expand on what kind of issues please.

[Gareth Nelson]

Put simply, you could lose the keys for your newer coins, and those old coins in your old wallet may already have been spent.

[Basiley]

the thief is very clever and waits for that window between you giving the key to the service provider and them running the transaction

Clever thief normally performs the transaction ASAP to outstrip the victim with her backup service.

Clever thief wants to lead any investigations away from him and onto the innocent 3rd party

clever thief rob only wealthy/rich people, ride horses and wear black coat
like Robin Hood or Zorro, yes :-P