When you are storing your bitcoins for a longer term, using a paper wallet ensures maximum safety. In this tutorial, you will learn how you can make a Bitcoin paper wallet.
I am assuming that you already have a software wallet, and you want to secure your bitcoins offline. If you don’t have a software wallet, do read my previous article on making a Bitcoin wallet.
DIY Tutorial: How To Create A Bitcoin Paper Wallet
First of all, you need the following:
- Internet access.
- Printer with ink.
- A smartphone with a QR code reader.
- A software Bitcoin wallet with bitcoins in it.
- USB stick (optional).
Once you have procured the above things, you are ready to make a paper wallet.
Step 1: Connect your internet. Go to https://www.bitaddress.org in your web browser.
Step 2: Save the web page to your local desktop.
Step 3: Locate the web page download on your desktop.
Step 4: Disconnect your internet.
Step 5: Stay disconnected from the internet and open the downloaded HTML file.
Step 6: Hover your mouse here and there on the local web screen to create a safe degree of randomness.
Step 7: Keep hovering here and there on the screen until the percentage number completes to 100%.
Step 8: Automatically, as soon as 100% of randomness is achieved, you will get the below screen.
Step 9: Click on the Paper Wallet option next to Single Wallet.
Step 10: Three public addresses will be generated with three private keys.
Step 11: If you wish to get only one paper wallet, change the Addresses to generate and Addresses per page to 1 and click Generate.
Step 12: Click Print to get a printable file. Now, print this file using your printer.
Step 13: After printing, with scissors cut out the main portion and keep it somewhere for your records.
Your paper wallet is now ready to use.
You saw how we were away from the internet and safely created a bitcoin address and a private key? That’s why it’s safe.
What if I include the BIP38 encryption option?
This is an additional security feature; you can call it a two-stage verification process.
Using this option, you can encrypt your private keys based on the passphrase you used. It is like making a password protected with a password.
Now, even if someone gets to your paper wallet and steals your private key, he/she cannot use it because the private key will only be unlocked using the passphrase.
When you spend bitcoins with a key encrypted with BIP38 encryption, the software wallet prompts you to enter the passphrase to unlock the private key, and only then can someone use it. But if you forget the passphrase, it is almost impossible to get your private keys back, and you won’t be able to use those bitcoins.
Here’s how you can make a normal Bitcoin wallet encrypted with BIP38:
Step 1: Click the box to enable BIP38 encryption, enter a passphrase, and click Generate.
What if I don’t include the BIP38 encryption option while making a Bitcoin paper wallet?
Nothing will happen. You can make one without using BIP38 encryption also, but once your Bitcoin paper wallet is lost or taken by someone, or your private keys are exposed accidently to someone, then that person can use your bitcoins.
So this extra encryption is recommended while making paper wallets.
How To Use Your Paper Wallet and Load It With Bitcoins.
- Use the below Bitcoin address QR code to transfer bitcoins onto this address from your software wallet.
- Once the QR code is scanned, transfer bitcoins to the address.
- Once bitcoins are transferred to this address and you receive your confirmations, your Bitcoin wallet is loaded. On the right side of the paper wallet, you can see your private keys.
- In below image, you can see in the center a field called “Bitcoin Amount”. You can write the amount with which you loaded your bitcoins here and keep that info safe somewhere.
- It is a good idea to have multiple copies of this printed wallet as a backup in case you lose it.
Pros & Cons of Bitcoin Paper Wallets
- Can be used as gift cards once you load it up with bitcoins.
- Easy to carry around (like a paper currency note).
- Bitcoins can be lost only when someone physically steals your paper wallet.
- Easy to create.
- Easy to store.
- Bitcoins can be spent without using your software wallet.
- Practically free to setup
- Paper has limited durability and life.
- If someone steals your paper wallet and it is not BIP38 encrypted, you will lose your bitcoins.
- You can accidently expose your printed private key.
I would really recommend you to use paper wallets if you have bitcoins in significant amount and have no intention in near future to spend it.They are safe and cheap than software or hardware wallets in aspects like they can’t be hacked and are secure against malware or viruses.You own your private keys,unlike 3rd party software wallet services.It is even easy for a non tech savvy person to store or spend bitcoins with paper wallets.
How To Get Bitcoins Out Of Your Paper Wallet To Spend?
- Scan/enter the wallet/bitcoin address from your software wallet to wherever you intend to send/spend your bitcoins.
- Scan the private key on the right side of the paper wallet using your Bitcoin software wallet.
- Click Send, and your bitcoins will be transferred to your chosen bitcoin address.
And that’s it!
I hope you like this detailed tutorial on creating and using a Bitcoin paper wallet.
In an upcoming article, I will provide a detailed video of this, and I will also be covering what to do in case you want to import your keys onto a software wallet and destroy your paper wallet.
Until that time, stay tuned at CoinSutra and keep sharing the Bitcoin revolution!