As someone transacting in cryptocurrencies every now and then, you must have gone through the process of setting up a Bitcoin account. For users that are new to crypto, the process is one of the basic undertakings you must complete before you can hold Bitcoin wealth or transact in the cryptocurrency.
For newcomers into the crypto world, creating a Bitcoin wallet is not as complicated as you may be imagining. This tutorial will guide you through the process, and cover important aspects that you need to observe to ensure your Bitcoin stash is safe from prying eyes and scammers.
What is Bitcoin Wallet?
Before delving deep into the process, it is important to explain what the narrative means by the phrase Bitcoin Wallet.
Simply put, a Bitcoin wallet refers to the combination of a Bitcoin address complete with its corresponding public and private keys. Even simpler, the phrase defines the identifier of a user in the blockchain that he or she uses to send or receive Bitcoin payments on the network.
The keyword “Bitcoin Wallet” is nothing more than a description of the various ways that a user can organize his or her public keys as well as secure the corresponding private keys. In the narrative, you will realize that there are various ways of doing so. Also, these various ways differ in the degree of usability as well as security.
The various Bitcoin wallets are:
• Web Wallets – These are relatively unsecure, meant to hold considerably small stashes of coins and are appropriate for completing purchases.
• Hardware Wallets – Suited for long-term Bitcoin holding, very secure.
• Local Wallets – Offers a combination of the best security and usability.
The process of installing and using these different wallets differ from one to the other.
Setting Up a Bitcoin Wallet (Web)
Start by downloading the Bitcoin wallet application depending on the operating System (OS) installed in your device. The supported OS are Windows, Linux, Mac, Android, and iOS.
If you are installing Bitcoin.com wallet, for instance, you should navigate to the home screen, then tap on the "+" sign in the wallets menu. This action will initiate the process of downloading the wallet.
Do note that most wallet platforms will ask for your email address. The address helps when verifying your identity. It also is a security feature that is essential if you want to reset the password.
When creating a password, ensure it is strong, preferably with at least 10 characters. The characters should be a mixture of upper and lower case letters, numbers as well as the special characters such as $, #, & and many more.
After you have completed the process, ensure you write and store the start phrase securely. Remember, this phrase is critical when you want to reset your Bitcoin wallet if you forget your password.
Using Hardware Wallets
Hardware Bitcoin wallets serve the needs of individuals that value the safety of their cryptocurrency wealth. These physical devices hold your private keys and can be used to facilitate transactions as well.
To use a hardware wallet, you first need to make a purchase, depending on your desired quality and budget range. Some of the available premier quality hardware wallets are:
• Trezor – has a small interactive screen from where you can input instructions. The device generates the private keys, which cannot be extracted from the wallet. This feature makes it safe and immune to malware.
• Pi Wallet – A safe and easy-to-use wallet that an Armory’s client. Its key feature is its cold storage properties that lack wireless capabilities.
• USB Wallets – Considerably more popular that the first two, probably because they are comparatively cheaper. They protect your data using the same mechanism of the microprocessor chips on debit and credit cards. Unlike Trezor and Pi, USB wallets require a computer to establish a connection.
Once you decide to get a hardware wallet, ensure you procure it only from the official store. e-Commerce stores such as eBay and Amazon may seem a great source but that is never true when buying a hardware wallet.
After getting your hands on the wallet, do ensure you go through the manual to familiarise yourself with how the wallet functions. Start by unboxing the device to confirm if you have every accessory.
Then, plug it into your PC or laptop to initiate the process of configuring and initializing the device with the seed or recovery phrase. Just to be clear, a recovery phrase or seed is a 24-word key that you use to set up the device. It is also important if you need to recovery the device in case you forget the PIN.
Using Bitcoin Paper Wallets
A Bitcoin paper wallet is nothing more than the private and public keys all printed in one paper. As its name suggests, these wallets (the wallet information) are printed in paper or plastic, or any other material that can hold a printed information durably, for that matter.
It is the public and private keys that are printed on paper, usually the QR form of the information. After printing the information on a paper, ensure you destroy the copy from the computer.
Start by cleaning up your computer and set up a printer, which should offline. You should clean the computer using a high-quality anti-virus after wiping it clean with a military-grade hard-drive cleaner.
Download the paper wallet generator by visiting the wallet generating site and download the zip file. Disconnect the internet soon after completing the download process. Then, open the file and print out the keys, and ensure you delete all the files associated with the said key.
Setting up a Bitcoin wallet is easy as pie. However, you have to know which of the available wallets best suits you needs. After you have identified the appropriate wallet, go through the paces highlighted in the narrative above and set up a wallet that meets your needs.