A paper wallet is one the most popular and safest options to store your bitcoins. But before we go into the details paper wallet, we’d want you to know what is a Bitcoin wallet and why do you need one.
A Bitcoin wallet is a digital wallet that is used to store coins and make transactions; similar to a traditional bank account.
The wallet consists of two keys: A public key and a private key.
- Public key: Your address on which other users send coins to you.
- Private key: Which you use to send bitcoins to others. They key is kept private and only the owner of the wallet knows about it.
The combination of public and private key is what makes a bitcoin transaction possible.
It is important that no one knows about your private key , otherwise, it would give some unwanted entities the access to your wallet, which puts your coins at the risk of theft.
So, if you are using an online or an offline wallet, you’ll be vulnerable to hacking/malware attacks as your keystrokes can easily be logged.
Moreover, a stolen PC or losing your hard drive means you can wave bye to your digital assets for good.
Utilized with care, a paper wallet can shield you against these possibilities.
What is a Paper Wallet?
A paper wallet consists of the public and private keys that make up the wallet in a documented form.
It often has a QR code, so that you can quickly scan it and add the keys into a wallet to perform a transaction.
The prime benefit of having a paper wallet is that it doesn’t store the keys digitally; making it immune to cyber-attacks or a hardware failure.
A downside of the paper wallet is that it’s delicate and must be kept away fire and water.
How to Create a Paper Wallet:
- Open your favorite browser and go to BitAddress.org
- After typing some random characters to create randomness, you will be presented with a QR code, a private key, and a public key.
- Click the tab “paper wallet”
- Select the number of addresses to generate
- Click “generate” button for creating new wallets
- Once the wallet is generated, print it out to make a hard copy
- Make a note of public addresses
- Scan the QR code in your Bitcoin app to start depositing funds
What Are Some Security Tips for Paper Wallet?
Due to the fact that these wallets are used to save large amounts of money, it’s necessary to take precautions and make it as secure as possible.
The list of some useful tips for protecting your bitcoin wallet (paper) includes:
- Make sure no one sees you while creating a wallet
- BitAdress uses an algorithm named BIP38 to support encryption of private keys. The algorithm utilizes two-factor authentication i.e. something you have (paper wallet) and a passphrase.
- Use a clean operating system such as Ubuntu to eliminate the risk of a spyware monitoring your activity.
- Laminate your wallet or store it in a sealed plastic bag to protect it from water/damp.
- Store it in a locker to protect it from theft.
Follow these tips and your paper wallet would be safer than ever.
To make sure your wallet is safer than ever, read our tips on how to secure a Bitcoin wallet.
Bitcoin jumped on Thursday to its maximum price in just about four weeks as cryptocurrency developers appeared to come more rapidly to an agreement which would prevent the cryptocurrency from splitting.
According to CoinDesk, Bitcoin has gone high more than 15% to $2675.67 which is its maximum level since June 25. As of July 20, the cryptocurrency traded near $2648. It is high about 4% for July and more than 170% higher for the year.
Bitcoin Performance Chart of Three Months:
Image Source: CoinDesk
Developers should have to settle on “activating an upgrade” which is known as SegWit (Segregated Witness) by 1st of August in order to prevent the cryptocurrency from splitting or forking. According to GDAX exchange of Coinbase, if the currency split, it might pause the trading of Bitcoin.
According to Ari Paul, the chief information officer of Block Tower Capital, Bitcoin is assembling largely because the activation probability of SegWit is increasing as more miners signaling that they will activate it. There is no need to agree all the miners, but at least 80% should agree.
As the prices are going higher, the interest is also increasing in the cryptocurrency world from Wall Street. Forbes stated on Tuesday that Bitcoin is the main asset of the investor Bill Miller’s hedge fund.
Rise in Ethereum Price:
The TradingView charts of Coinbase data shows that Ethereum also jumped more than 18%, to nearly $230, which is its highest since Tuesday. Ethereum rushed below $200 over the weekend.
This rise in Ethereum came as the hackers stole over $30 million in Ethereum from wallets because of security flaws. Earlier in the week, hackers stole over $7 million by hacking the initial coin offering for CoinDash.
Story Source: CNBC.com
We all know that Bitcoin is the king of digital currencies, and there doesn’t seem to be any other coin that can dethrone it from the top.
Although not similar, many digital currencies can still be used as a perfect alternative to Bitcoin. Some even claim to be technically superior to Bitcoin. Whether it’s true or not is completely another debate. In this article, we have discussed the top five digital currencies that are closest to what Bitcoin offers and can be used as an alternative to the king of cryptocurrency.
Top Alternatives to Bitcoin – Ethereum:
Bitcoin vs Ethereum is the closest battle when it comes to currencies trying to overtake Bitcoin.
Ethereum is a public blockchain software which promises to offer much more than just digital currency. The developers can code the software and power it through the public blockchain.
The users can then sell their processing power and get paid in “ether” – the second largest cryptocurrency by market capitalization after Bitcoin.
Ethereum has a market cap of $1bn USD.
Emerged in 2012, Ripple has become one of the most popular digital currencies to make online transactions anonymously. The paramount aspect of ripple is that it offers instant conversion into several other currencies.
Ripple considers itself a companion of Bitcoin and converts Bitcoin to Ripple and vice versa.
The market cap of ripple is $220m USD, making it the third largest cryptocurrency in the world.
Litecoin emerged in 2011 and is one of the oldest cryptocurrencies out there. Given below are some highlights of Litecoin:
- Similar to Bitcoin, Litecoin is decentralized.
- Litecoin is also generated through solving algorithms, which become more and more difficult over time.
- A Litecoin block takes just 2.5 minutes, which is much quicker than Bitcoin – where it takes around 10 minutes to generate one block.
- Due to quick generation, Litecoin supports far more transactions than Bitcoin.
- The overall cap limit of Litecoin is set at 84 million, which is relatively higher than that of Bitcoin’s (21 million).
The current market cap of Litecoin is about $175 million – making it the 4th largest cryptocurrency in the digital world.
With $170 USD market cap, Steem is the 5th largest digital currency. “Steemit” is the largest platform that offers the opportunity to earn Steem. The platform is filled with a huge range of stories.
Since there is no mining process, you can only earn Steem by contributing to “Steemit”, either by writing articles or rating/commenting on other’s articles.
The last one on our list is Dash, which, in terms of features is pretty close to Bitcoin software. Here are some unique features of Dash:
- Advanced privacy. Some even say its privacy features surpass the ones offered by Bitcoin.
- Whereas Bitcoin transactions can take several minutes, Dash transactions are quick and instant.
- Low transaction fees.
- Similar to Bitcoin, Dash is P2P and decentralized
Although the competition is tough, Bitcoin is leading the race by a fair margin and isn’t going away anytime soon. However, the other currencies are also there to stay and compete, which will surely play a significant role in the evolution of digital currency environment in near future.
Bitcoin trading was started since 2010 which is the source of Bitcoin’s universal myths or discussions. When a Bitcoin exchanged gets hacked, financial media considers this hack a result of the flaws of cryptocurrencies. Until now, Bitcoin protocol has never been hacked. Due to its next level encryption, hackers do not attack Bitcoin directly. Instead, they manipulate the weaknesses of Bitcoin exchanges.
Are Bitcoin Exchanges Vulnerable To Hacking?
According to the report of the U.S Department of Homeland Security, one-third of Bitcoin exchanges were hacked between 2010-2015.
A South Korean exchange ‘Bithumb’ was hacked last month with 30,000 customer’s data on it. The hackers were able to steal $1million worth of bitcoins. As a result, the price of Bitcoin dropped about 3.5% during the following two days of the event.
Bithumb revealed that employee’s computers which provide the access to customer’s data were targeted during the attack.
In August 2016, Hackers successfully took 120,000 Bitcoins, worth $65million from Bitfinex exchange. In that case “Hot wallet” feature was the weak link. These frequent Bitcoin exchange hacks are no doubt concerning, but this should not be a reason to dismiss Bitcoin usage.
For example, if a diamond jewelry shop is successfully robbed, it’s not the diamonds’ fault, rather the security management that was hired by the owner. Same is the case with the Bitcoin code users.
Why Has Bitcoin Itself Never Been Hacked?
Bitcoin codes use a network security protocol known as SHA-256. SHA: Secure Hash Algorithm. This is the prime reason why Bitcoin is known as a cryptocurrency. SHA-256 is widely used by the government and financial sector of the Bitcoin and was designed by the National Security Agency.
Crypto experts and programmers believe that SHA-256 is unbreakable by the currently available technology. Chris Wilmer, founder of Blockchain-Focused said, “Bitcoin itself, and most of the other cryptocurrencies, have never been hacked or even really had any downtime.”
Due to the fact that Bitcoin uses SHA-256, and that its transactions are broadcasted to the network for confirmation, Bitcoin is the securest form of currency ever created.
Just think about it, if you have fiat money and it gets stolen or snatched by someone, it becomes incredibly difficult to trace it. In addition, a stolen bag exposes your data including bank’s check book, debit/credit card to untrusted parties and takes a whole lot of months to resolve the issue.
Besides, credit/debit is an old fashioned payment system. Considering the tools available these days, hackers could get an easy approach to this old form of digital money.
Today, the Credit card breaches have become a daily routine. The hits at Target Corp. (NYSE: TGT) and (NYSE: HD) occurred a couple years ago. Neiman Marcus and Wendy’s Co. (Nasdaq: WEN) breach is another example which just happened in 2016. The most recent ones are Chipotle Mexican Grill Inc. (NYSE: CMG), Arby’s Restaurant Group, and Kmart Corp, which happened in 2017.
Whereas, bitcoins are safe at your Bitcoin exchanges and provide maximum security against breaches. Don’t let one or two incidents define the whole currency and start your Bitcoin venture right now!