Your wallet is your money and there are many paths that can be taken and will ultimately end in you losing your money. Learn how to avoid these Crypto wallet hazards and pitfalls, and keep those coins safe!
Important Crypto Wallet Points
- This guide covers core wallets. The majority of core wallets out there are based off the bitcoin core wallet and so the majority of important functions and how the wallet should be handled are the same across alt-coins.
- Your receiving address is a public key, the matching private key id stored in the wallet.dat. If somebody has your private key they have the coins attached to the matching public key.
- Your coins are stored on the blockchain, not in your wallet.
- If you forget your wallet passphrase you lose your coins. If your wallet.dat gets corrupted and you don’t have a backup or the private key(s) you lose your coins.
Wallet .dat Locations
- Windows: C:\Users\YourUserName\Appdata\Roaming\Bitcoin
- Linux And Mac: ~/.namehere (do ls -la if not sure this will show you the directory which is usually hidden)
Securing Your Wallet From Loss Or Theft
Encrypt the wallet: Normally this is in Settings > Encrypt Wallet. I normally randomly pick at least 8 words or names and they are separated with a “-“. Using spaces can cause weird issues so use either a – or _ for separation.
Note: If there are already funds in the wallet copy the wallet.dat to another folder. After encrypting the wallet restart it and test to make sure the password you set works. If all is good destroy the unencrypted.dat (important!).
Stash the .dat: Keep this .dat file in a few different locations such as a USB and even stored online. We will cover online storage later in this article. Never keep the .dat in just one location such as your computer. If the .dat gets corrupted or you have a drive failure say bye bye to your coins.
Dump The Private Keys And Secure Them
GUI Style (should be same on all OS): Help > Debug > Console and type:
walletpassphrase password 600
Explanation: Unlocks your wallet for five minutes.
Dump Keys: Again in console window, type:
Explanation: Enter the filename you want to dump the keys into. You will find the file in the same place as your wallet.dat
Alternative: If you only want to get the private key for a select few addresses you can do that by:
Command Line Style: Same as above GUI style only you will run this command from inside your wallet directory unless of course you have an alias set for it: (example command with RavenCoin)
./raven-cli walletpassphrase password 600
./raven-cli dumpwallet filename
The file contents can be a little confusing. It contains a pool of addresses and keys (default is 100) both used and unused (reserved). Should you need to restore you will need to know the addresses that contain the coins and then match that up with the corresponding private key in your dump file. Then import the private key.
Important: Importing private keys is a last ditch option, do not play around with this on a production wallet holding substantial funds. If you want to test it create a new wallet with minimal funds.
Encrypt The Private Keys File!
You must encrypt the file you just dumped the private keys into, there is no maybe or it will be ok. Those keys are your coins sitting in plain site, anybody that has them has your coins.
Encrypting On Windows
Download AxCrypt > Install, and encrypt the file. I won’t cover this as it is quite straight forward. I will say that you should not store the AxCrypt password on your computer. Print it or write it on a couple pieces of paper and stash it.
Encrypting On Linux
Easily done with gpg. From the same directory as the key file type:
gpg -c filename (filename being the name of your key file)
Enter a strong password when prompted and make sure you have that password recorded offline (paper). Now test it to make sure you can decrypt it:
If it works then you are good, encrypt the file again.
Storing Private Keys Offline (Recommended)
Put the list of private keys that were dumped in a text file and print them off. Print a few copies and keep them in multiple secure locations. Such as a safe in the house or shop. This is simpler then the whole dump and encrypt as outlined above. The only time I may not recommend this is if you have many different addresses as entering hundreds of private keys by hand if needed would ….. suck.
Backing Up The Backups
You cannot be to careful and I prefer to keep multiple copies of my .dat files and if using encrypted keydump files those as well. I use Acronis Ransomware Protection to keep my critical files backed up, you also get the added bonus of Ransomware protection. This is free and includes 5GB of storage in their cloud at no cost. Acronis is proven and trusted across many different industries. That being said I highly suggest you only store encrypted files, do not store anything in plain text.
Updates And Adding A New Receivable Address
If you add a new receiving address you should create a fresh backup of your wallet. You will also have a new private key so you need to update your private key file. You don’t need to dump the entire wallet you can instead get the private key by unlocking the wallet as shown above then using:
Add the new addrees and private key to your private key dump file. Keeping your wallet up to date is important! Most Cryptos will have their wallet on GitHub. Making a GitHub account and following each projects repository is a great way to know when there are updates to the wallet files. Before you update make a copy of your .dat so you have a quick restore should the update go bad.
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