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    Author Topic: Safely withdrawing from a paper wallet  (Read 174 times)

    • paper_btc (OP)
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    February 04, 2018, 06:20:05 PM
     #1
    Hi all,
    I have a significant amount of bitcoin (~10) in a paper wallet (the actual private key is printed on a piece of paper). To improve security measures and possibly sell forked coins, I would like to transfer the funds to a new address.

    I understand the technical procedure - sweep the private key into a wallet software and send to the new address. But what security aspects should be considered?

    Some online resources recommend myCelium, but while I am cautious I do not trust my Android devices to be free of malware. I plan on using a PC with a Live CD linux distro (e.g. Ubuntu) installed on a fresh USB disk. What wallet and withdrawal procedure would you recommend? Does the Electrum Cold Storage feature has any benefits for a one time transaction?

    Thanks!

  • OmegaStarScream
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    February 04, 2018, 06:28:38 PM
     #2
    You are planning to keep holding them after moving them somewhere else? If yes, then I see no reason on moving them. I either suggest to keep them in your paper wallet as It's more secure then your PC or phone or actually buy a hardware wallet (Trezor or Ledger nano S) but to answer your question, Electrum should be a good choice to sweep your private keys.
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  • paper_btc (OP)
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    February 04, 2018, 07:45:28 PM
     #3
    Thanks for the quick reply. Without going into details, I have reasons to believe the wallet may be compromised (this is what I meant by "improve security measures"). I am not sure yet about using a HW wallet, but I believe that does not change the answer regarding withdrawal.

    Are there any specific disadvantages to using Electrum for this vs. running a full node wallet such as Bitcoin QT (besides privacy)? Do I gain any benefits from using Electrum Cold Storage?

  • OmegaStarScream
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    February 05, 2018, 10:05:07 AM
     #4
    Quote from: paper_btc on February 04, 2018, 07:45:28 PM
    Are there any specific disadvantages to using Electrum for this vs. running a full node wallet such as Bitcoin QT (besides privacy)?
    Not really, when it comes to security, they are pretty much the same, safe as long as your PC contain no malware.

    Quote from: paper_btc on February 04, 2018, 07:45:28 PM
    Do I gain any benefits from using Electrum Cold Storage?
    I'm not sure what you mean here, a wallet is considered as cold storage as long as It's not connected to the internet.
    So, assuming that you're just holding for long term (as you didn't give details), here what I suggest to do: Either buy a hardware wallet like I already said above or use another paper wallet by encrypting the private keys using a password. As on how you transfer the funds, just install Electrum on Ubuntu like you planned to do, keep it connected to the internet and sweep the funds there and then send them wherever you want to.
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  • dado7
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    February 05, 2018, 10:11:44 AM
     #5
    If the funds are still there then it's probably not compromised. In any case, consider moving to SegWit address. They have improved security over regular addresses. The only downside is that it is still not possible to withdraw the funds to exchanges, but the technology will be there and if you plan a long-term hold you should be OK with that.

  • paper_btc (OP)
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    February 05, 2018, 02:43:28 PM
     #6
    Quote from: OmegaStarScream on February 05, 2018, 10:05:07 AM
    I'm not sure what you mean here, a wallet is considered as cold storage as long as It's not connected to the internet.
    Electrum has the ability to sign transactions on an offline machine and later broadcast them from an online machine, meaning that the online machine never "sees" the private key (link). I am trying to figure out if there are any advantages to using this method for a one-time transaction (vs. signing and broadcasting from the same online machine).

    Quote from: OmegaStarScream on February 05, 2018, 10:05:07 AM
    So, assuming that you're just holding for long term (as you didn't give details), here what I suggest to do: Either buy a hardware wallet like I already said above or use another paper wallet by encrypting the private keys using a password. As on how you transfer the funds, just install Electrum on Ubuntu like you planned to do, keep it connected to the internet and sweep the funds there and then send them wherever you want to.
    Holding for long term, but not entirely sure if I want a HW wallet. Depends mostly on a decision to sell forked coins, as my private bitcoin key may become compromised (when going a sketchy s***coin wallet/exchange). But anyway, the question is about transferring from the paper wallet.

  • paper_btc (OP)
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    February 05, 2018, 02:58:45 PM
     #7
    Quote from: dado7 on February 05, 2018, 10:11:44 AM
    If the funds are still there then it's probably not compromised. In any case, consider moving to SegWit address. They have improved security over regular addresses. The only downside is that it is still not possible to withdraw the funds to exchanges, but the technology will be there and if you plan a long-term hold you should be OK with that.
    Thanks, you are probably right but better be safe...
    And yes, I am considering SegWit addresses.
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