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HomeCryptoCurrencyThese are Jameson Lopp's tips for the safe storage of your bitcoin

These are Jameson Lopp's tips for the safe storage of your bitcoin

«Talking about bitcoin is very popular among bitcoiners. What is not advisable is to talk about your bitcoins ». Discretion is the first recommendation from Jameson Lopp, CTO of security firm Casa, dedicated to developing bitcoin security software. The specialist intervened last Friday, November 19 at LaBitConf, with a talk entitled The best practices for storing your bitcoin.

Lopp offered in his talk concrete examples of the risks that arise when a user comments publicly about the BTC you own. He referred to a high-profile case on Twitter in 2017, in which a user pointed out that he had all of his BTC on Coinbase. Within 24 hours he suffered an attack to replace the SIM chip of his cell phone and lost all his funds.

“Thieves cannot steal what they do not know you have,” says the specialist and adds that who does not comment with others about their bitcoins, decreases the probability of attracting attention and being attacked.

The co-founder of Casa stated that the most prominent risk that bitcoin faces it is the accidental loss of the private key . “In the early days of the protocol it was very easy to lose bitcoins and a lot of people did. It is estimated that so far there are about 4 million bitcoins lost, almost a fifth of all the bitcoins that will exist, “says Lopp.

Part of that risk has been mitigated through technology , for example, through metal devices for storing the bitcoin private key or through the use of multi-signature wallets.

Bitcoin in metal

The recommendation to write down the seed phrase, or the set of keywords that give access to a portfolio of bitcoin, and storing the paper “in a safe place” carries many risks, says Lopp. Paper is vulnerable to moisture or fire, among other eventualities, such as simply forgetting where it was stored.

The lecturer gave details about the different options of metal supports that exist in the market to store the words key, and highlighted that one of the most recommended, due to its simplicity and efficiency, is the plate with a squared matrix , in which the respective letters of each keyword are indicated with a perforation in the corresponding square.

The previous photo shows a plate that allows recording 12 words and on the right side it is appreciated that there is no loss of data when it is subjected to fire. This particular plate is the size of a credit card. Standard-size ones store up to 24 words.

The necessary prevention

«An ounce of prevention is worth more than a pound of medicine». With this phrase, Lopp highlights that the majority of bitcoin holders do not think about self-defense measures because they do not believe that they are targets desired by hackers. “Even if you consider that you have a modest amount of BTC, you must remember that once someone steals it, that action is almost always irreversible,” he says. The proof of the lack of prevention is in the number of BTC stolen, which is estimated at 2 million, says Lopp.

It also refers to the fact that if there are not, in general, greater security measures , the perception about the value of bitcoin could be affected. “If everyone were careless in properly safeguarding their assets, they would not be worth much.”

Regarding the risk of theft of private keys, for example, safes, hiding places or distribution of the words can be used key. To avoid digital theft, on the other hand, storage in cold wallets is a highly recommended alternative.

Self-custody of bitcoin, through applications, is always subject to risks, says the specialist, and recommends multi-signature proposals, which offer greater security. It also warns against custody granted to third parties, for example to exchanges. “These exchanges have shown significant vulnerabilities against hackers, who constantly update their attack methods,” he says.

In addition to all technology-based attacks, those that are based on social engineering are the most difficult to contain , argues Lopp. These attacks are based on deception and have proven to be efficient in many types of scam.

He showed as an example a communication via email, posing as a cold wallet provider. The intention of the communication was to warn that there were records of wallet failures and that the user had to enter the seed to solve the problem. The careful design of the message, with the provider’s logo, could convince some careless users, who thus hand over the private key and the BTC disappears in seconds, said the speaker.

Finally he referred to an aspect little addressed when talking about the security of bitcoin: the inheritance of BTC. The methods of safeguarding the private key are aimed at a single person having access to it. As a security provider, Casa has protection plans for BTC funds that include conditional access by the heirs to private keys, Lopp stated.

At the end of last October, Lopp stated in his Twitter account that half of the bitcoin in circulation were in the hands of custodial companies, a fact that was commented on by CriptoNoticias. According to figures from Glassnode and Chainalysis, the amount of BTC in custody platforms is between 2.5 million and 8.5 million.

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Sandra Loyd
Sandra is the Reporter working for World Weekly News. She loves to learn about the latest news from all around the world and share it with our readers.

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