Recently the 2016 movie Banking on Bitcoin was released on Netflix. With it came a flurry of excitement from folks who, up until now had no idea how ‘this whole Bitcoin thing’ worked. And from the movie’s elderly kitchen discussion, to the benign and jovial ‘how Bitcoin works’ infographics, you would be forgiven for thinking that hackers are bumbling around in a confused daze over it all.
Especially when Wall Street Journal Columnist Michael Casey stated:
“The key point here is that this a distributed ledger. There is no central server… The bitcoin ledger resides, on, you know, thousands of computers. You can't hack that”.
Do I have wax in my ears? Did I just hear you say - you can’t hack Bitcoin?
Just like my ‘decentralized’ honey stash, anything of value, on and offline is up for grabs to a determined thief, and especially Hot Wallet Crypto.
Is Your Bitcoin Wallet Really At Risk?
Earlier this year, hackers gained access to a hot wallet owned by Genesis Mining - one of the oldest and most well known Bitcoin companies around. And while Genesis were quick to mitigate losses, and reimburse customers for missing funds, other folk aren’t that lucky.
One month earlier, $400,000 in Bitcoin, Ethereum, Ethereum Classic, and Zcash was stolen from the cross-platform cryptocurrency wallet, Jaxx and never returned. A report from Vx Labs identified the serious (and ongoing) vulnerability, stating:
“Even when your Jaxx has a security PIN configured, anyone with 20 seconds of (network) access to your PC can extract your 12 word backup phrase and copy it down. Jaxx does not have to be running for this to happen.”
On Reddit, Jaxx CTO Nilang Vyas replied:
“Jaxx is a hot wallet suitable for small amounts (similar to your regular wallet in your pocket). Jaxx IS NOT cold storage. For large amounts we recommend hardware wallets.”
Even the so-called ‘unhackable’ blockchain knows it can be hacked.
Back in December 2016, the Chinese exchange, BTC38 was hacked to the tune of 1.5million RMB / approximately $220,000 USD.
“You can’t hack that”? Impawsible!
While hot wallets can be hacked, there is a way to prevent it.
How To Bolster Your Bitcoin Security, Easily.
As Jaxx’s CTO infers, you don’t have to empty your wallet to hackers. Not when you have some unhackable Cold Storage.
(… I like the shiny ones)
But didn’t Vyas say cold wallets are just for large sums of cash?
Yes, he did – but fear not! Just like the millions of dried up savings accounts around the world, many cold wallets, like Cold Storage Coins, have no minimum storage amount. So owning Bitcoin becomes hackproof and safe, but also fun and easy for those who are still a little green on the idea of ‘this whole Bitcoin thing’.
If the thought of being Bit-hacked seems un-bearable to you too, this is the easiest way to own Bitcoin.
But How Do I Use Cold Storage Online?
I’m glad you asked! And while I can’t speak on behalf of other cold storage options, I can say that Cold Storage Coins have a nifty QR code so you can scan and check your balance. And you can move any crypto amount online for immediate use. It’s just like transferring savings over to your ATM card.
But as for me, I’m more of the investing type, so I’ll be hibernating on my cold wallet and checking it in Spring (… after I chase the hackers from my best salmon fishing spot).