Creating a Secure Bitcoin Paper Wallet

Last updated: 2/13/19

A paper wallet is a general term given to a piece of paper with a private key (or seed phrase) written on it. It’s considered to be one of the best practices for keeping your private key safe. In this post I’ll explain an ultra secure method for creating a paper wallet.

Post Summary

Here’s the short (non secure) way for creating a paper wallet:

  1. Go to BitAddress
  2. Move your mouse around / type in random text to generate a random private key
  3. Click “paper wallet”
  4. Choose how many copies you’d like to print out
  5. Encrypt the wallet with a BIP38 password (optional)
  6. Print and enjoy :)

That’s it!

If you want a more detailed explanation about the process keep on reading. Here’s what I’ll go over:

  1. What is a paper wallets?
  2. The simple (non secure) way of creating a paper wallet
  3. The advanced (secure) way of creating a paper wallet
  4. Keeping your paper wallet safe
  5. Conclusion

Don’t like to read? Watch our Video Guide Instead


1. What is a Bitcoin paper wallet ?

Your private key (or seed phrase) should be kept offline in what is known as Cold Storage. A private key is a long, confusing string of random characters, while a seed phrase is a set of 24 random words that allows you to restore your private key.

Simply put, paper wallets mean writing or printing your private key or seed phrase on a piece of paper, instead of saving them on your computer.

Usually this process will be done for the purpose of storing large amounts of Bitcoin. It’s considered much safer than keeping coins on a hot wallet (i.e. a wallet that is connected to the internet).

When storing your Bitcoins on a paper wallet you can only load funds to the wallet. If you want to send those funds you’ll need to import or sweep the paper wallet’s private key to a software wallet in order to get access to your coins.

Here’s how a paper wallet looks like:

bitcoin paper wallet


2. Creating a paper wallet (simple method, less secure)

Creating a paper wallet is pretty easy, the trick is to secure it correctly. If you just want to see the process in action and don’t care that much about security you can follow this process:

  1. Head over to BitAddress (an open source software for producing paper wallets).
  2. Move your mouse around / enter random text to help generate a random private key.
  3. Once done, choose “Paper Wallet” and print out the results. Your Bitcoins can then be stored through the public address on the left.
  4. You can also add a passphrase to encrypt the paper wallet for additional protection by ticking the BIP38 encryption box.

That’s it! The process literally takes 30 seconds and you have your own paper wallet. You can generate as many addresses as you’d like by entering the amount on ‘Addresses to generate’. The addresses will all be unique and different.

Here’s the whole process in video:

Why is this considered non secure ?

First of all, since you’re connected to the web while doing this, someone may have the ability to see what’s going on on your screen.

Second, if someone was able to hack BitAddress for example, they can collect all of the private keys that people created on the site.

Last but not least, if you’re using Windows you may have been infected with Malware which you are unaware of. This may put your private key at risk as people may be monitoring your actions.


3. Creating a paper wallet (advanced method, ultra secure)

If you’re really serious about safeguarding your Bitcoins you have to make sure you create an ultra secure paper wallet. This process is a bit tedious but it’s worth the effort.

Why is this process considered secure?

  1. You’re not connected to the Internet while producing your private key.
  2. You’re using an “out of the box” operating system which is less prone to Malware.
  3. You are using an offline version of BitAddress so no one can hack this site.

The necessary tools

This process is designed for PCs (Mac tutorial will be coming soon but for now you can get the general idea).

Here’s what you’ll need to download to your computer before getting started. You will also need a brand new (or completely formatted) flash drive.

Ubuntu download (latest version) – The operating system we’ll use

LiLi download (latest version) – A software to install Ubuntu on our flash drive

BitAddress download  – The software to create the paper wallet

Step 1 – Install Ubuntu on your flash drive

IMPORTANT: This step will erase everything you have on the flash drive.

  • Open up LiLi and insert your flash drive.
  • Make sure you’ve selected the correct drive (click refresh if drive isn’t showing).
  • Choose “ISO/IMG/ZIP” and select the Ubuntu ISO file you’ve downloaded in the previous step.
  • Make sure only “Format the key in FAT32” is selected.
  • Click the lightning bolt to start the format and installation process

lili-setup

After the process is finished, unzip the BitAdrress file you’ve downloaded in the previous step and copy it into your flash drive.

Step 2 – Go offline and test the printer

At this point you would want to disconnect your computer from the Internet whether it’s Wi-Fi or a LAN connection. Make sure there’s no way remote access can be granted to the computer. When finished, make sure you are still able to print a test page so you’ll know your printer is functional.

Step 3 – Run your computer using Ubuntu from your flash drive

Restart your computer. Clicking F12 or F1 during the boot-up process will allow you to choose to run your operating system from your flash drive (#6 in the image below).

load ubuntu from usb

After the Ubuntu operating system loads you will choose the “try Ubuntu” option.

Step 4 – Setup a printer on the Ubuntu operating system

At this point you will want to set up your printer on the Ubuntu OS:

  • Click on System Settings (a monkey wrench and cog wheel icon)
  • Click on “Printers”
  • Click on “Add”
  • Add your printer
  • Print out a test page

add printer

Step 5 – Open BitAddress and print your new paper wallet

The final step will be to open the copy you have of BitAddress.org and create a paper wallet locally on your machine.

  • Open private browsing in FireFox (right click -> “Open a New Private Window”)
  • Type in the following in the address bar: file://cdrom/bitaddress.org-master/
  • Click on the link “BitAddress.org.html”firefox bitaddress
  • Create your paper wallet by moving the cursor around until the number on the top right reaches 100
  • Choose “Paper Wallet” from the menu
  • Choose how many copies you’d like to generate
  • Add BIP38 encryption (optional)
  • Print out your paper wallet

bitaddress print


4. Best practices for keeping your paper wallet safe

Once you have your paper wallet you can load funds to it by using the Bitcoin address on the left side. It’s important to keep the private key (on the right side) hidden and discreet.

Here are a few methods you can use to better safeguard your paper wallet:

  • Get it laminated so it doesn’t tear or fade
  • Keep it inside a safe or a location that only you can access
  • Use a device like Cryptosteel to make it disaster proof

 

An advanced method includes creating several copies of the paper wallet, each holding only part of the private key or seed phrase. For example, creating three partial copies that any two of them can create the whole private key. This way you can leave each copy at a different location and make it harder for someone to obtain your private key if they only stole one copy.


5. Conclusion – You Need Cold Storage

If you’re serious about Bitcoin and want to store large amounts of coins you need to get some form of cold storage. If you have the funds I suggest using a hardware wallet, but if you can’t afford it or want to avoid it for any other reason, a paper wallet is the way to go.

My personal advice is that if you do end up using a paper wallet, take the time to go over the secure advanced method and create an ultra secure one. The extra 30 minutes or so you’ll invest in the process may end up to prove worthwhile.

Have you had any experience with paper wallets? What’s your favorite method for creating it? I’d love to hear about it in the comment section below.

Bitcoin Video Crash Course 

Dummy-proof explainer videos enjoyed by over 100,000 students. One email a day for 7 days, short and educational, guaranteed.

We hate spam as much as you do. You can unsubscribe with one click.

72
Leave a Reply

avatar
30 Comment threads
42 Thread replies
10 Followers
 
Most reacted comment
Hottest comment thread
40 Comment authors
Steven HayCyrusSteven HayAnother IdeaJohn Recent comment authors
  Subscribe  
newest oldest most voted
Notify of
Cyrus
Guest
Cyrus

I have created a private key and address on bitaddress.org. How can I check the balance of this paper wallet? blockchain.info requires a password. Am I doing something wrong here? on bitaddress.org, is there a feature to create this password?

John
Guest
John

What is to prevent malware from infecting the ubuntu ISO post download?

Yho
Guest
Yho

Hi! Please, For which other crypts do paper wallets exist? (Ada, Miota, Xem … anyway). Thanks

Rino
Guest
Rino

Hello, I have many doubts about the safety of the crypto currencies …. I am interested in Bitcoin but I want to protect the Altcoins on which I have invested …. I really liked the article on the paper wallet and I want to put it into practice immediately but first I have 2 questions to ask: 1) Instead of opening private browsing in FireFox, can I use Chrome’s incognito navigation ??? Is it the same or can it create problems ??? 2) In addition to downloading the archive “Bitaddress.org-master.zip” I can also use “Walletgenerator.net-master.zip” from https://github.com/MichaelMure/WalletGenerator.net and above all,… Read more »

Guest123
Guest
Guest123

Is there a possiblity that the website creator already has these pub keys + secret keys stored and just basically random it away those instead of just actually “Generate” them?
And they could just randomly check which one got coins in it then search for our secret keys in their database and fuck us all?

hello
Guest
hello

Hi Steven Hay, how can we be sure that these kind of sites doesnt store our private keys and public keys somewhere??
Is there a way to create our own keys without using these kind of sites?
I’m having trust issues here
Thank you

Jose
Guest
Jose

How is it possible for public and private key to be added to the blockchain if you are offline?

Val
Guest
Val

I am having a really hard time understanding this whole bitcoin thing. Okay, your idea is to basically create an offline paper wallet using clean or offline machine. I get that, makes sense. But then how will you access your funds even single time without entering your password/key into the web? There is no such thing as magic, for every transaction you will need to enter a key somehow, which still means you need to share it with some web service again. Creating a wallet is only half the challenge, using it securely is a totally different thing and is… Read more »

Abraham
Guest
Abraham

Hi Ofir! Thanks a lot for your post, it has been very helpfull. I have a question about the BIP38 Encrypt option that appers on the bitaddress page, What is it for? Does it add more security to my wallet?

Thank you in advance for your time….

Dan
Guest
Dan

Hi there ! The content you just presented is amazing and it really helped me (as a newbie in crypto) to understand what a paper wallet is. However, doing the tutorial step by step, it all goes really smooth until I need to insert the link into firefox in order to open bitaddress.org . It just says that the file can’t be found and I’m really stuck here. Can you please give any kind of advice?