This post is also available in: Khmer
[CryptoAsia is publishing a series of articles to help residents of Cambodia get started using bitcoin and bitcoin wallets. In our first article below, we introduce some of the most popular bitcoin wallets you should consider for storing your bitcoin.]
Introduction to Bitcoin Wallets
Now that you know a little bit about bitcoin and how it works, it’s time to learn how to keep it safe in a bitcoin wallet.
Before we get started, you must understand 2 basic rules about bitcoin.
First, if you do not control your private keys then you do not own your bitcoin. When you entrust your private keys to a 3rd party service then there is no guarantee that your bitcoin will be safe. For this reason we only recommend wallets that give you exclusive control over your bitcoin private keys.
Second, if you do not back up your private keys and you lose access to your bitcoin, then your bitcoin will be lost forever. Making a backup of your bitcoin wallet is an easy and essential first step before becoming an active user. Information on how to make and store backups can be found on the website of the wallet provider you choose.
So, let’s get started!
Blockchain.info is one of the longest standing and most respected bitcoin companies around. Their service provides access to your bitcoin wallet from your phone and computer simultaneously, without storing your private keys on their server.
Having access to your bitcoin wallet on the cloud is a nice convenience. However, if the website server goes offline or your Blockchain account has issues then you will lose access to your bitcoin. Don’t worry, if you back up your private keys your bitcoin can be restored, even if the Blockchain website permanently disappears. Make sure to use a strong password for your account and enable 2-factor authentication (2fa). Detailed and easy-to-follow instructions on backups and 2fa are available at blockchain.info.
Electrum has a simple interface but it is rich in features; particularly nice is the multiple wallet functionality. Unlike the Blockchain app, Electrum is a stand-alone app for your phone or computer and doesn’t require a 3rd party account in the cloud. Because of this, you should load the wallet on one device (phone or desktop computer) where you plan on using bitcoin the most.
The Electrum smartphone app is a fast and convenient way to carry your bitcoin with you wherever you go. The Electrum desktop app is one of the most efficient ways to run a bitcoin node from your computer.
Regardless of the device you choose to run Electrum, it is essential that you write down your 12-word wallet seed on a piece of paper and store it in a safe place. You will be prompted to do this when you first create the wallet. If you ever get hacked or lose/break your device then don’t worry. You can easily restore your private keys from the seed you used to create the wallet (Write It Down!).
Since not long after bitcoin was first created the bitcoin core development team has been maintaining the open-source code of its original wallet software. It is the most stable and secure wallet in the world.
Running a Bitcoin Core full node on your computer requires that you download a copy of the entire bitcoin network transaction history (called the blockchain). Downloading the blockchain increases the resiliency of the bitcoin network and the security of your own transactions. The Bitcoin Core software is resource-intensive as a result of this, but don’t let that stop you from using it.
As always, don’t forget to set a strong wallet password and store a back-up of your private keys externally.
Some people choose to store their bitcoin in a hardware wallet offline, completely disconnected from the internet. This is a smart move if you are concerned about hackers and security. But don’t forget, even hardware wallets can have vulnerabilities.
There are two major hardware wallet manufacturers, Ledger and Trezor. Neither of them has much presence in Cambodia yet, but CryptoAsia is hoping to change that soon (watch this space for more information in the future). For now, you will have to order one of these devices from overseas.
We have given you a brief introduction to some of the most popular bitcoin wallets in the world. With a bit more research you should be ready to go. After installing and running the wallet software of your choice, you will be ready to buy bitcoin for the first time. Congratulations and good luck!
[Honorable Mention – Exodus and Mycelium]