Bitcoin: How to create a cold storage

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What is cold storage? In the world of Bitcoin, cold storage is nothing more than a wallet where your private key is offline.

It is ideal to generate the private key using an offline procedure, and ensure it has never been used before.

These are some frequently asked questions regarding this type of wallet:

  • For what?

To provide greater security for some of our bitcoins

  • How many bitcoins should I have in this wallet?

Purpose

This purpose of this wallet is similar to that of a safe or chest.

Each person’s storage amount will vary, but bitcoins that are not intended for daily transactions, and which we do not want to use regularly, should be stored in this wallet.

 The analogy is comparable to what we already do with fiat money.

We do not store all of our money in the wallet we carry in our pocket because if we were to lose or have it stolen, we would lose all of our money.

 This is why we generally choose to carry a small amount of money on a regular basis and the rest we keep in a safe place.

Similar to other cryptocurrencies, we can also perform this action with Bitcoin.

It is not sensible to store everything in a single wallet, and it makes more sense to have one wallet (or several) to transact and another (or several others) to store most of our funds.

  • I have my bitcoins in an online exchange, is it the same?

No, when we have our bitcoins in an exchange we do not own the keys to our wallet. This is why we are at the mercy of the exchange being ethical and honestly handling our funds. If something happens to the exchange (a hack, site shutdown, etc.), we run the risk of losing all our bitcoins.

  • Once I have transferred funds from my cold storage to another wallet, should I create a new cold storage?
See also  Design Patterns for Smart Contracts

Although having a cold storage with unused private keys is safer, it is not necessarily a requirement.

  • Should I also keep my public key in a safe place?

Not at all! The only thing we must protect tooth and nail is our private key.

  • And where do I keep my private key to keep it safe?

We can trust wherever we store it, whether it’s printed on paper, encrypted inside a pendrive, stored in a safe, or even a mixture of these.

To see the full article you please visit: https://medium.com/@anarancio/bitcoin-como-crear-un-cold-storage-dac4d7456277

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Infuy is an international technology leader company specialized in outsourcing services in the latest technologies. Blockchain (smart contracts, dApps and NFT marketplaces), full-stack, mobile development, and team augmentation are some of the areas where Infuy specializes in. As a software development company based in Uruguay with offices in the US, Infuy is always looking for the next big challenge, and the next big partner. As a fast-growing company, Infuy is always looking for talented and proactive people, who live up to the challenge and are as passionate as their team is about their mission to provide the best solutions to their partners, with the latest technologies, to join the team. For more information about the company and its services, please visit https://www.infuy.com/.