Creating a secure bitcoin wallet
While some people will tell you that the best place to store your bitcoins is with yourself, they say instead of using online wallets like blockhain.info and coinbase.com is best you download the bitcoin client for your PC and store your bitcoins yourself. They stated that what if one day blockcchain.info website goes down with all your coins inside your online wallet stored in their system you lose all your bitcoins.
Well, installing the PC bitcoin client and storing your bitcoins yourself is not also safer you could also loose all your bitcoins in one day.
HOW?
When you install the bitcoin client, a wallet.dat file is created and that file contains some information about your wallet; the information the wallet.dat file contains includes your private keys and remember that anyone with your private keys can steal all your bitcoins. What if your PC is hacked and the hacker gets access to your wallet.dat file and extracts your private key from it, what if a close friend or family whom you trust accesses your PC and steals your wallet.dat file. What if your hard disk crashes, what if your PC is lost or stolen. Here some people recommend copying your wallet.dat file into a flash/thumb drive and keeping the flash/thumb drive in a safe location in case your PC gets lost or stolen. You never know what if the flash/thumb drive gets damaged or missing.
There is a popular way most people recommend creating a secure bitcoin wallet that method involves installing a Linux operating system on a usb drive or hard disk to eliminate the risk of viruses and now they boot into the Linux OS and install the bitcoin client app for Linux. Any time they need to access their wallet they plug in the usb drive or hard drive into their PC, boot into linux and use it. When they are through they disconnect the flash/thumb drive and take it back to their safe secure and undisclosed location. Some even keep backups of their wallet.dat file in 3 – 4 different drives the length you go to secure your wallet depends on how much bitcoins you have to protect. This method explained above is really safe but what if there is a fire? Okay i am being ridiculous.
I recommend brain wallets. Wallets that is stored in your head. As at the time I wrote this article 75% of the bitcoin world is against using brain wallets to store large amounts of bitcoins because brain wallets is about thinking of a set of words and these words are run through a certain algorithm to generate your private key and wallet address. They say that if someone can guess the exact words that you used, he can generate your private key and seal all your bitcoins.
This is true and this highlights the a very big danger with brainwallets which in turn highlights’ the importance of not using simple words to generate brain wallets
“AshleyTomPeytonBradley%%%China” people don’t easily guess this.