How to Import, Export, Store and Manage Private Keys in Cryptocurrency Wallets
If you own cryptocurrencies in any form, you store them in wallets. A private wallet is a good place to keep your private keys. However, there are many options out there that are full of security holes. If someone gets into your wallet, they’ll steal your keys. Lose your keys, and you lose your Bitcoins.
In this entry, we’re going to show you how to store keys properly and give you a few other tips about your wallet and private key management.
Importing, Exporting, Storing, and Managing Private Keys
If you’re wondering about the best way to import, export, store, and manage your private keys, the answer is simple – find a quality wallet. A good wallet can tackle all four aspects of Bitcoin storage.
Every Bitcoin wallet is used for storing your private keys. Not all wallets allow you to import and export them, however. Exchange wallets, for example, give you a private key and store it for you. You can’t import any new keys. You aren’t in control of your private keys, either – the crypto exchange in question does this on your behalf. As long as the exchange is safe, your keys are secure as well. Huge exchange-wide hacks have been known to happen in the past, though.
Private wallets will let you store, manage, import, and export your private keys. You’ve probably tried looking up something along the lines of “how to import wallet to blockchain.” Unfortunately, there is no unique answer to this type of question. It varies from wallet to wallet. On private wallets, you are the one in control of your private key – not even the wallet creators have access to this information. This is arguably the best Bitcoin private key storage option.
What to Look For in a Wallet
A Bitcoin wallet is usually a place where people store all their crypto assets. Even if it’s only one of your crypto storage options, you’ll want to ensure that the wallet is secure and functional.
First and foremost, never download a wallet unless it’s from an official website. We are aware that you’ve previously downloaded countless apps from non-official websites, but crypto wallets aren’t your regular apps. They are used to store crypto funds, and you don’t want them to be corrupted or compromised – this is how cybercriminals steal people’s cryptos.
Another thing to keep in mind when choosing a blockchain export wallet is the MD5 checksum. In short, this is a digital fingerprint that helps the user verify that the file that they’ve downloaded is similar to the file that the wallet creators have made and uploaded.
Even if you are aware that downloading a wallet from its official website is the right way to go, there are phishing scams that can lead you to a website that was made to appear like the legitimate one, and have you download/use a wallet to steal your private key.
Unfortunately, the MD5 checksum can be forged. It does help to avoid some malicious wallets, but the only way to be absolutely sure that the wallet file is legitimate would be to check out its GPG signature. The creator of a wallet attaches their own GPG signature to help you confirm that you have the legitimate version. Even if the attackers are to replace the original file and create a fake MD5 checksum, they won’t be able to correctly sign the binaries.
Custodian Wallets
Custodians are services that specialise in managing your Bitcoin private keys. These include various telegram bots, exchanges, online wallets, and even some software wallets. The services that offer this take care of your funds’ safety. Most of them guarantee refunds if they happen to lose your coins as a result of service-wide hacks. However, there are shadier alternatives that won’t compensate you for this.
Most custodial wallet services aren’t scammers – they won’t steal your funds, but many of them have a lack of technical knowledge and feature various security holes.
Holding the entirety of your funds in custodian wallets isn’t the best way to store private keys.
Open-Source vs. Closed-Source Wallets
Like any form of open-source software, open-source wallets kept their development open to the public. The obvious advantage of these is their progressiveness, features, and capabilities. The downside is that they are susceptible to hacks and code alterations. Client-side open-source wallets are run from the client’s browser and are much safer than the full-on open-source versions.
Although closed-source wallets offer a solid degree of privacy, they are far from the best way to store private keys. Nobody can guarantee that the coding team behind this wallet type won’t just steal your keys and disappear. Plus, closed-source wallets use remote servers to store the users’ wallet info, which means that they are no better than custodial wallets.
Hot Wallets vs. Cold Wallets
The difference between a hot and a cold wallet is very straightforward. Hot wallets are installed on devices that are connected/can connect to the internet. This means desktop computers, laptops, mobile phones, tablets, etc. Cold wallets are stored on devices and objects without an internet connection.
Every exchange wallet, blockchain export wallet, browser extension wallet, even wallet app is considered a hot wallet. The fact that the device it’s installed on has an internet connection makes it susceptible to hacker attempts. We’re talking about cybercriminals who know how to find private key of any Bitcoin address out there.
Cold wallets are either pieces of USB hardware or plain papers with QR codes on them. As long as you keep these hardware/physical wallets in your possession and don’t allow anyone else to gain access to them, your funds are safe. Unfortunately, if you happen to lose these devices, you also lose your crypto assets. Plus, they aren’t convenient for crypto transfers.
Which Wallet to Go With
Unfortunately, there is no unique answer on how to store keys to your crypto assets. To make things worse, opting for a single platform for your entire Bitcoin private key storage is definitely not recommended, either.
The safest way to go here would be using multiple wallets. For instance, have a blockchain export wallet for quick private access to your crypto assets. But also have some funds on the exchanges that you use so that you can make quick trades. The bulk of your crypto funds should be kept in a few cold wallets. Never use just a single wallet for importing, exporting, storing, and managing your private keys. The more wallets you have, the safer your funds are going to be, overall.
Learning How to Import, Export, Store, and Manage Your Private Keys
There isn’t a single universal way to handle everything related to cryptocurrency storage. Some wallets, for instance, don’t allow you to manage your private keys at all. Others, on the other hand, give you full control over them. In any case, spreading out your cryptocurrency possessions is the smartest way to go.
Don’t forget to back those private keys up, either. Lose a key, and you’ve successfully robbed yourself of your Bitcoin.
Safe crypto storage can be frustrating and overly complicated. However, it’s incredibly important that you safeguard your investment. Bitcoin is the money of the future, and you don’t want to live through the next bull run without any Bitcoin to your name.