Four facts about Bitcoin wallets that you must know

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Bitcoin wallets are a fundamental part of all the cryptocurrency process. In the virtual world, we can’t carry Bitcoins in our pocket, so wallets are mandatory. However, there are still some things you might not know about this digital item. So, here are four curious facts about your current or, who knows, future wallet.

Fact 1: Old wallets and their contents can be retrieved

This fact is described as a weakness on Bitcoin Wiki and it’s related to the act of changing your wallet password. According to Bitcoin Wiki, “an old copy of a wallet with its old password is often easily retrievable via an existing backup facility (particularly Apple Time-Machine): draining that old wallet, with its old password, drains the current wallet with the current password – this is contrary to most non-technical users’ expectation of what ‘change the password on your wallet’ should mean following password compromise”. It’s not something as easy as most people think, but this is what you must do if you want to create a new wallet: you need to send your the sum of your to the new account with new passwords.

Fact 2: Wallets are stored unencrypted by default

The early adopters of Bitcoin and the tech savvies already know, by now, that a wallet needs encryption to be safe. But a lot of newcomers are less likely to take a step like this, mainly because they don’t really know the Bitcoin world or because they just don’t have this kind of skills. However, as more people are investing in Bitcoin, more important default encryption will become. Unfortunately, this doesn’t mean that people will start doing it more often.

Fact 3: Bitcoin thefts have occurred

This is more a reminder than a fact, since almost everyone who owns Bitcoins knows this. Wallets aren’t completely safe and there are reports of thefts. In June 2011, for instance, one user claimed in a Bitcoin forum that someone had stolen 25,000 Bitcoins from him, the equivalent of $375,000. And the last scandals with exchange platforms aren’t helping.

Fact 4: The problem might come from where you least expect

There’s a quote on Bitcoin Wiki that makes everyone think about who is dealing with our money: “there are no guarantees that any eWallet service won’t one day take all your bitcoins and disappear”. A lot of people don’t even think about this, but it’s the truth. What kind of law or suthority will stop a platform like this? We will go ahead and say ‘none’.

Via techhive.com

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Maria Santos

Maria is an experienced journalist currently living in the UK. She has been writing about Bitcoin and the altcoin universe since 2013. She is also a member of the Lifeboat Foundation's New Money Systems Board and a big cryptocurrency supporter.

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