How to backup a bitcoin wallet

July 08, 2020

With the popularity of cryptocurrencies, there was a need for online wallets to store the crypto coins safely. Bitcoin wallets are generally encrypted with private keys that can be accessed only by the user.

If the private keys are misplaced, then the user will be at risk of losing all their assets. There have been multiple cases where users have misplaced the private keys, flash drives, and hard disks with Bitcoin in them.

Fortunately, with Zipmex, you don’t have to worry about losing your private keys. All you need to remember is your password to your account. Plus if you have 2FA on, you will need access to Google Authenticator.

How to Back-up Your Wallet?

If you wish to store your assets off an exchange, you can do so by storing them on a cold wallet such as a Trezor or Ledger USB device. Once on the device, no one can access your Bitcoin without your private keys or mnemonic seed phrase. If you misplace your cold wallet or if your hard drive crashes, you can recall the seed phrase and private key to set up your wallet again.

Back up the Entire Wallet

You can backup an entire wallet with all the hidden internal private keys. The private keys linked with your Bitcoin address are not enough to recover the whole amount.

Depending on the storage location of your Bitcoin, you can look for a “Backup wallet” or “Export private keys” option in your Bitcoin wallet menu. You can then save this exported backup to a flash drive or copy it to a piece of paper and store it in a secure location. You can also encrypt the backup so that no one can access it even if they get hold of the file.

Encrypt Wallet

Backups stored online are also prone to theft and hacks. Your computer may be connected to an internet connection that is vulnerable to malicious software and programs that can access your backups without your knowledge. 

Online backups have to be encrypted so that even if someone receives the backup files, they cannot access the backups. However, you need to ensure that you never forget the password or you may lose all your funds.

There are very limited password recovery options with Bitcoin wallets. You can maintain a paper copy of your password or store it encrypted online.

Since your wallet contains Bitcoins, you need to set a strong password which is at least 16 characters long with letters, numbers, punctuation marks. You can also use a password generator for a secure and robust password.

Use many locations

Storing your backup in a single location is not recommended. You can save your backup in various places such as USB, disk drives, hard drives, among others so that you have multiple sources of backups.

Make regular backups

You can backup your wallet regularly to incorporate all the recent Bitcoin change addresses and new Bitcoin addresses that you create. However, this will change as all applications may need to backup the wallet only once to access them.

What to be careful of when storing cryptocurrency

Always store your cryptocurrency in an encrypted online or offline wallet. You cannot store your cryptocurrency in any online wallet. Various fraudulent online wallets might steal your crypto balance, and you will never hear from them ever again. 

Some online wallets may not have appropriate security controls. Ensure you visit the actual website URL address and not a phishing site. Double-check the reputation of the site by doing a Google search. If the search result shows negativity or no results, then this is a red flag. Only store your cryptocurrency in secure places.