Hey guys,
I just earned a few Bitcoins and wanted to test creating a secure wallet. I have a few concerns which I hope someone could explain me. Here is my plan to do this. Please add if I miss something or some other method is better! Also I apology for my noobish questions.
1. I will create a Linux boot CD and boot my computer with that, starting Linux desktop version.
2. I will download Bitcoin software (Bitcoin-QT) from bitcoin.org/en/download and create a new wallet with a few addresses. (Is this absolutely secure on Linux environment? Without doing some hardening or adding firewall?)
3. I will encrypt the wallet by using the encryption provided within Bitcoin software.
4. I will copy the encrypted wallet over to a brand new flash drive and have a backup of it on another flash drive.
5. I will delete the wallet on my computer.
6. I will shutdown linux and go to my PC and send the coins over to the addresses of my new wallet that is stored within my flash drives.
7. I will store the flash drives separately to secure locations. (I understood that the wallets don't need to be connected to internet in order to receive Bitcoins to them?)
8. When I'd like to access my stash, I use the live CD to boot my PC, download bitcoin-qt, unencrypt the wallet from one of the flash drives and place it to the proper file path and that's it?
Is there anything else to add?
You've pretty much got it. Indeed, wallets do not have to be connected to the internet. The wallets don't contain the "coins themselves," as the coins are just an entry in the blockchain which is kept track of by the entire network. The wallets just contain the permission to use the coins.
As for #2, if you're super-worried about the haxx0rs, note that you don't even have to have this computer connected to the internet. Once you get the bitcoin source package, and the necessary dependencies, that is. Then you can disconnect the internet, start the client, and create the wallet. The wallet is just a private key; it doesn't need to send or receive anything from the network for it to be functioning/valid. You could never put that wallet online and still "send" "coins" "to" "it" for years.
As for a livedisk, I'd use "Tails" which is a distro of linux specifically set up for security, anonymity, privacy etc.
