Crypto online wallet security

Bitcoin Questions and AnswersCategory: General questionsCrypto online wallet security
Shane Sekuloski asked 2 weeks ago

Hi,
When you backup an online wallet is that just referring to the Private key or does a wallet have tokens inside it and you have to backup and take those tokens offline as opposed to keeping them online?
If I use a cloud provider like Blockchain.info and keep my Bitcoin and Ether wallets in there and they do not have my private key is that considered secure or once again do I have to export the wallet contents out of their cloud site?
Thanks in advance
Shane

1 Answers
Zsofia Elek Staff answered 2 weeks ago

Hi Shane,
It is advised to backup your wallet to make sure you keep your private keys safe. In this case, you are backing up the private key that is needed to access your tokens. There are several types of wallets on the market, offline solutions are always safer as online wallets are more exposed to hacking attacks.
 

Steven Hay Staff replied 2 weeks ago

Hi Shane,
Just to clear this up, the tokens you own do NOT work like files within your wallet. Instead, every full copy of the blockchain contains ALL tokens or coins which may be spent (in what's known as the Unspent Transaction Output database or UTXO set).

Your wallet is like a window onto those spendable tokens relevant to you and under your direct control. You may only spend them by using your private key contained in your wallet, so this privkey is what's so important to backup and keep secret.

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