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Understanding Bitcoin-How To Store Your Bitcoins-Lesson 11

Invest In Bitcoin And Other Types Of Crypto Currency And Crypto Coins By Joining The BitClub Network

· Bitcoin,BitClub Network,Crypto Currency,Cryptocurrency,Crypto Coins

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Author : Bitconnect
 

The ledger wallet application does not need administrator privileges to install and can be used safely on an untrusted machine. The ledger can have multiple ledger wallets in a multi-signature configuration for further security. TREZOR. A TREZOR Wallet is similar to LEDGER, but it is a bit larger and connects to the USB port via a cable. It works in a similar way but has a screen and two buttons on the device, the screen shows the wallet address you are sending coins to and you press the buttons to confirm/cancel the coins, this is a security measure to ensure you are sending the coins to the intended address. This is a high security option and the TREZOR can also use a longer password. The security of the TREZOR is possibly the highest of any hardware based wallet solution, and uses the same recovery seed method as the LEDGER. Advantages. Very high degree of security, very hard to attack and in the case of using them in a multi signature configuration, almost impervious even to theft through the users themselves without all parties consenting. The most secure ways to store coins, even more secure than paper wallets as paper wallets are vulnerable to theft of the raw private keys when it is entered. Portable, the same private keys can be loaded onto multiple hardware wallets via the recovery seed. Disadvantages. Upfront cost, ledger starts at £20 GBP, the TREZOR at £90 GBP. If used without multi signature, does not stop employee theft within a company, this can be negated. The physical device is needed to send/receive coins, although the seed can be imported into many desktop wallets such as electrum. No protection against forced sending of coins, for example at gunpoint.
 

LEDGER is working on plausible deniability features by use of a second password which takes the user to a dummy wallet. Summary. The hardware based wallet solutions are practically impervious to all methods of attack. There is a small vulnerability in LEDGER, where use of the ledger with the security card on an infected machines many times over can potentially get enough information to decipher what is on the security card. This can be negated by using the mobile device authentication. With this in mind, and especially when used in a multi-signature configuration hardware wallets are impervious to nearly all types of attack. Use of any hardware wallet other than these two should be researched as vulnerabilities in the random number generators used for the private key generation used in any type of wallet can be a risk if it is not truly random. They still must be set up on a secure machine, provided this is done they are the best method of storing coins long term and are impervious to attack from nearly all vectors. To avoid the risk of damage by fire/flood or other disaster the seed should be saved in multiple locations. There is an option on TREZOR to encrypt this seed with a passphrase. Provided these precautions are followed your risk of theft or loss is almost zero, minus being forced at gunpoint to send coins. This can be negated by splitting your holdings to multiple wallets, or use of multi-signature. The next wallet to be discussed is mobile wallets.
 

Mobile Wallets. Mobile wallets at https://play.google.com/store/apps/details?id=de.schildbach.wallet&hl=en_GB are bitcoin wallets stored on your mobile phone, tablet, iPod touch or another portable device. They can be used when out and about for shopping and paying for coffee, among other things if a merchant accepts bitcoin. They typically scan the receiving address as a QR code. These are typically protected with a PIN. They can be further secured by encryption of your phones device memory. Android can enable this feature. They are good for everyday amounts of coins, but backups of the wallet file should be taken. Due to their weak PIN that is often used they should be stored offline. They are reasonably secure, unless your device is rooted and at risk of malware, or your device is lost without a backup. Due to the weak PIN often used, encrypting your device with a password and ensuring the wallet is on the device or the SD card is also encrypted, but have a lower chance of infection than a Microsoft windows desktop wallet. There have been known instances of many mobile wallets being emptied due to a weakness in the random number generator, resulting in many private keys being cracked by an external hacker by testing every possible combination of a random number generator which was not truly random, article shown here at https://bitcoinmagazine.com/articles/critical-vulnerability-found-in-android-wallets-1376273924.
 

Read more about Bitcoin and The BitClub Network.

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