Guellord MbusaTo store cryptoassets, users use a tool called wallet. There are several types of crypto wallets. Today, it can even be somewhat difficult to choose the right solution, especially for a beginner. You can opt for an online wallet on an exchange platform (not recommended, eh) or a non-custodial wallet For example. These are both types of wallets that we use the most.
However, because both types of wallets are connected to the internet, they are prone to hacks and cyber-criminal attacks. For protect your cryptocurrencies and protect them from cyberattacks, many people suggest the use of a hardware wallet type Ledger ou Safepal. They are known to be very secure. However, they are relatively expensive hardware wallets… Another alternative exists and these are “paper wallets”.
In this article we will explain what wallet paper is. Why do some people prefer paper wallets? What are the advantages and what are the disadvantages? Does it have a strong potential for securing cryptocurrencies and how to create a paper wallet?
A paper wallet: what is it?
A paper wallet or paper wallet (in French) is a piece of paper on which the user's private and public keys are printed. Some wallet paper may also have a barcode scannable created by an application. It's a way to store and access your cryptocurrency without an internet connection. In practice, when a user prints their keys, they are removed from the cryptocurrency network while existing and can only be accessed with the printed keys.
Indeed, a paper wallet is a printed sheet of paper containing keys and QR codes used to facilitate cryptocurrency transactions. Once the code is printed, the wallet and all codes are removed from the internet. Not being connected to the internet, paper wallets are not vulnerable to cyberattacks.
In other words, you can only lose your cryptocurrencies if someone else gets their hands on the paper your keys are printed on and you damage or lose it. As a result, paper wallets have always been considered more secure than other forms of cryptocurrency storage.
Why are paper wallets no longer “popular”?
Note: The entry into the market of companies manufacturing hardware wallets (like Ledger) is relatively recent. Bitcoin users tended to use paper wallets…
Wallet papers were generally used before cryptocurrencies became popular. Bitcoiners used them before hardware wallets appeared. Since the high adoption of crypto assets, storage technology has improved. Also, paper wallets are generally offered free of charge. The sites survive with a system of donations. So there is no marketing, no companies behind it, no influencers who will promote paper wallets…
But paper wallets still remain a valid (and free) way to store your keys to secure your crypto assets. As you may find yourself obliged to use a paper wallet, we consider it essential to understand what a paper wallet is and how it works.
The steps to follow to create a wallet paper
Wallet papers are generally created by paper wallet generator applications. These are software programs that are designed primarily for this purpose. Among these software, the best known are:
- BitAddress
- WalletGeneretor (This is the one we use personally)
- Bitcoinpaperwallet.com
- Mycellium Entropy
Very simple. Here are some steps to follow to create a paper wallet.
Step One: Strengthen Your Computer Security
This is not a general cleaning of equipment. This is simply a strengthening of the computer's security by a complete scan using an up-to-date antivirus. The use of more complex devices such as Tails (a security-focused boot disk) or Glacier (a multi-computer process) is recommended.
Also remember to connect your printer to the internet.
Second step: Downloading the paper wallet
Be careful never to generate a portfolio online. It is advisable to do this offline on the Bitaddress.org website. Several security precautions will be imposed on you after downloading the file. Among these, the verification of the PGP signature of the author.
Step Three: Disconnect
The disconnection stage is the centerpiece for the success of paper wallet generation for bitcoin (BTC). Aside from disconnecting your computer and printer, you also need to choose between Google Chrome ou Firefox and disable any other web browsers.
Step Four: Portfolio Generation
Once disconnected from the Internet, you can generate one or more wallet papers. To do this, simply open the Bitaddress.org.html file contained in the list of extracted zip files on the secure browser. By moving the mouse or writing random characters in the area dedicated for this purpose, you will have a bitcoin address. It is important to know that reaching a randomness level of 100% favors the automatic creation of a single wallet.
NB: Be sure to delete any downloaded files on your computer before reestablishing the internet connection.
Step Five: Portfolio Feeding
The power of the paper bitcoin wallet depends on the user's objectives. Generally, people fill their paper wallets with a view to saving for the long term or to give as a gift. Some also inject satoshis in small quantities to test the effectiveness of its public address. Moreover, we ourselves advise you to try with very small amounts at the beginning.
Sixth step: Securing the paper wallet
Although at this stage you have the physical version of your wallet in your hands, this does not mean that it is secure and safe. You must put your wallet paper in a safe place. Place a tamper-evident seal sticker there, if necessary. Also remember to fold your paper wallet in such a way that no one doubts its contents. Store it in a place protected from humidity, for example.
Some people will prefer to place them in a safe at the bank. However, for people with significant capital, there are other solutions such as Casa.keys for example.
How secure is a paper wallet?
Wallet papers have long been considered one of the safest ways to store cryptocurrencies. However, they have fallen out of favor with many cryptoasset fans because they are sensitive to environmental factors. Indeed, it is easy for paper wallets to degrade over time, be misplaced or otherwise damaged.
However, cryptocurrencies can still be useful if they are printed clearly, stored securely and protected from damage. And in these conditions, they are among the safest because they are protected from cybercrime, a recurring practice in the ecosystem.
What are the disadvantages of paper wallet?
Very clearly, the biggest disadvantage remains the fact that you can lose the paper wallet relatively easily. Worse still, it's still paper, so it's prone to flooding and fire accidents...After a certain time, the ink can also fade.
So, even if overall it remains a bitcoin wallet secure, the fact remains that the risks of damage do exist.
Is the paper wallet a cold wallet?
Obviously, a paper wallet is a form of cold storage. Indeed, a cold wallet (the cold wallet), or its full name “cold storage wallet “, is a secure storage space not connected to the Internet. It is a wallet that allows you to keep your cryptocurrencies in a safe place, protected from any loss linked to computer bugs or hacks. Contrary to "hot wallet “, directly connected to the Internet, the cold wallet offers maximum security against the risk of a cyber attack.
Indeed, with offline storage, the attack surface is significantly reduced for hackers. Thanks to offline storage, cold wallets (offline) today represent the safest way to store your cryptocurrencies.
Final word on the Paper Wallet
To close, after embarking on any form of crypto investment, it is necessary to think about the security of your crypto assets. To keep your cryptocurrencies, there are several secure mobile applications (electronic wallets) such as Trust wallet and paper wallets which are subdivided into two types of wallets. It is hot wallets (connect to the internet) and cold wallets (offline) such as hardware wallets.
Each of the two types has different characteristics (such as being custodial or non-custodial), with advantages and disadvantages.
The sole objective of this article is to explain them to you so that you can choose, with full knowledge of the facts, on which type of medium your cryptocurrencies are more secure.
It's up to you to diversify your assets and vary your portfolios and make your security system more complex. Ultimately, this remains perhaps the best way to optimize the protection of your capital.
ðŸ§'â € 🠫 Other articles that may interest you:
-> Custodial and Non-Custodial crypto wallet: What are the differences?
-> Discover the most downloaded wallet in the world: Trust Wallet
-> Top 5 Lightning Network Wallets ⚡
-> How to revoke contracts on your wallet?
Note: No financial advice is given in this or any other article on zonebitcoin. This is information of which you are the sole judge and master. Be responsible with your investments and only invest as much as you are willing to lose.
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Hello ZoneBitcoin. I admit to being a little doubtful about this article. I believe that in 2022 it is more or less accepted that we should avoid using and recommending paper wallets, at least in the sense in which they are described here. In addition to the risks of loss or destruction, there is the risk of not generating it properly (infected machine, use of a corrupted site or app to generate the wallet), printing problem, error in the printed key, use of a machine that keeps the tasks in memory (with the risk that someone will make another copy afterwards) but even more common, the risk of not using the wallet properly. Many people who made a paper wallet thought they would have their key in a safe place forever. They opened a wallet, imported the key into a new wallet to spend part of it, then closed the wallet and put the paper wallet away, thinking of spending the rest later. However, the change was sent to an address generated by the new wallet which potentially was not saved or was subsequently deleted by mistake.
The best if you want to make a paper wallet is to generate a standard seed (BIP 0039) on a hardware wallet (Tezor, Ledger, Coldcard, BitBox2, Specter…) or a little more risky on a relatively secure PC by booting it on a widespread Linux Live key for which we have checked the origin of the ISO and verified the hashes and signatures with an equally reputable wallet (Electrum or Sparrow) the same by controlling the hash and signature of everything we install and use.
Then you have to write the seed on several papers or better engrave it on metal and store at least 2 copies in 2 different places (some apply the 3-2-1 rule, 3 copies on 2 different supports with 1 copy kept securely outside the main place of use.
The next level is to move on to multisign but here we are moving away from the subject.
If you still have paper wallets with Bitcoin, I really advise you to create a new wallet with a properly backed-up seed and to do a complete sweep of the paper wallet on the new wallet, to be sure you can recover your Bitcoin no matter what. when in the future without incurring all the risks linked to the paper wallet and its use.
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