What Is A Paper Wallet
A paper wallet is usually just a piece of paper which contains copies of the public and private keys which form a wallet. Usually, it has QR codes, so that you could quickly scan them and add the keys into a software wallet carryout a transaction.
The main advantage of a paper wallet is the keys will not be stored digitally anywhere, and therefore are not susceptible to cyber-attacks or hardware failures.
The disadvantage of a paper wallet is that paper and ink can degrade over time, and paper is pretty fragile – it’s worth keeping well away from fire and water for apparent reasons. Furthermore, if you lose a paper wallet, you’ll never be able to access the crypto sent to that address.
Do you need a paper wallet?
The response to this question can largely depend on your circumstances. If you plan to do a lot of day trading with your coins, then no you don’t, because holding them in a paper wallet might slow down your ability to trade. Conversely, if you’re invested in your coins for the long haul, and don’t plan to transfer/sell/trade them on a regular basis, then a paper wallet might be the right option for you.
Setting Up A Paper Wallet
Paper wallets are formed by using a program to randomly generate a public and private key. The keys are unique, and the program that generates them is open source. With a paper wallet, you can generate the keys offline. This eliminates the exposure to online threats, and deleting the program after use will get rid of any trace of them.
Walletgenerator.net Paper Wallets
The first step is to download an offline version of walletgenerator.net from Github and open the index.html file directly from your computer. For extra security, unplug your Internet access whilst you are generating a wallet with this software.
- Creating A Wallet: Choose your currency coin you want the wallet to represent and click on the “Generate new address” button. Make sure you get the coin right, as sending a coin to the wrong wallet will result in the coins being lost forever.
- Print the Paper Wallet: Click the Paper Wallet tab and print the page on the high-quality print setting. Do not save the page as a PDF file to print at a later since a file is more likely to be hacked than a piece of paper.
- Share your public address: Using your public wallet address will allow you to receive money from other crypto-currency users. You can share your public address as much as you want.
- Keep your private key secret: The private key is the keys to your coins, the password to your vault. If someone was to get hold of your private keys, they would be able to withdraw the all the funds in that wallet.
That’s all the basic info on using WalletGenerator.net. Please consider going to walletgenerator.net and making a donation, this will help with their efforts in continuing to offer this fantastic free service.
MyEtherWallet Paper Wallets
Go to MyEtherWallet and click on the help link towards the top of the homepage.
Select option 5 and click on the link to download the zip file onto your computer.
Before you open the file, switch off your internet so that you are offline. When you are offline, open the zip file in your computer and click on the index.html file.
Once it is open, enter a safe password in the field – one which you will remember, but nothing too easy. We advise a combination of no less than 15 characters of capital and lower case letters (LiKe ThIs), special characters (*?#%) and numbers (L!K3 Th!$). Record and copy this password off your computer and consider making more than one copy and keeping them in different locations. This password is essential for you to decrypt your MyEtherWallet.
Now you will have to download your keystore file which is basically your wallet file. Be sure to keep a backup of this file. After you are done with that click on “I understand. Continue.”
Now you can print your wallet by clicking on the “Print” button. Note that you can see both your private and public keys. Remember, never to share this private key with anybody.
Paper Wallet Disadvantages
- Fragility: At the end of the day, it is only paper. Paper can be easily damaged or it can get worn out over time. For this reason, always make multiple backups.
- Stealing: Since it is written on a piece of paper, anyone who can read it or take a quick photograph of it can steal your crypto. So make sure you keep it safe – consider a lock-box.
- Not immune from disasters: It is just a piece of paper, it is not immune to natural disasters and can easily be destroyed if you have not taken any backups. Make more than one copy of your paper wallet.
- The quality of printer used can also have a detrimental effect. Non-laser printers may cause the ink to run if the paper gets wet. Consider having your paper wallet laminated
- We are prone to mistakes and you could simply forget the location of your paper or accidentally tear it.
- Don’t worry if it sounds confusing, it’s not. You’ll need no specific knowledge of coding, or encryption. All you do need is a computer, an internet connection, something to record your keys on.