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oleganza

They do not emphasize wallet security issues enough.

Before buying any serious amount of BTC user must ensure:

1. Software that he uses actually encrypts wallets (BitcoinQT by default does not!).

2. His wallet is backed up in 3 places.

3. Backups actually work and he tried them.

4. His computer is not infested with malware.

5. He has multiple wallets and money is spread across all of them.

So that if he one days makes a payment, enters a password and virus steals his coins, he will not lose everything.

Blockchain.info is a great service, but only when you enable 2-factor authentication (otherwise your encrypted wallet can be bruteforced offline) and make sure you get backups by email.

Finally, everyone should remember:

THERE IS NO "FORGET MY PASSWORD" BUTTON.

If you own your coins, be it in BitcoinQT, Electrum or Blockchain.info, you must own your password. You lose it - you are done. People are not used to it. They should be.

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Paper wallets using offline-created Bitcoin addresses are the safest means of storage. I etched my keys onto metal dogtags and have them stored in a fireproof box.

> I etched my addresses onto metal dogtags

you mean you etched your keys, right? Nice idea.

Ack. Fixed and thanks!

No worries. Can you link/write a howto for that?

Here's a quick how-to:

1. Go to bitaddress.org and save the page to hard drive.

2. Take computer offline and generate keypairs.

3. Send coins to generated address(es) and print out private keys.

4. Etch keys onto metal (I used a Dremel though other methods may be better). Two copies stored in separate places might be wise.

5. Burn paper copy of keys.

6. Wait 10 years, buy Aruba.

i would recommend also using bip0038 to encrypt those private keys with a memory intensive hash.

> Blockchain.info is a great service, but only when you enable 2-factor authentication (otherwise your encrypted wallet can be bruteforced offline) and make sure you get backups by email.

2-factor auth does not and cannot protect against offline bruteforcing, quite the contrary, it's only relevant for online authentication with a service provider.

In your example it would be for authenticating with blockchain.info so they could perform an action on your behalf. Assuming they use your actual password as a master key to unlock a wallet they store on your behalf, the 2-factor piece is just extra security they are providing for actions performed through their site. 2-factor auth does nothing to prevent someone from trying to brute force the private key or pass phrase for your wallet.

I'm all for using 2-factor auth (I personally have it enabled on every site/service that supports it) but it's only for securing online access to an external service.

In case of Blockchain.info, wallet decryption happens in browser. The server sends you an encrypted wallet if you know user ID and provide 2-FA code. Without the code, anyone who knows your user ID will get the encrypted wallet and bruteforce it offline. With 2-FA they'd have to hack into your email or phone to get the code or hack into your email or computer to get your encrypted backup.

My interpretation of offline is if someone had access to their stored data (ex: blockchain.info is hacked, database is leaked, etc). In that case then 2-FA is pointless. It's only valid when interacting with them as an online service.

Usually you send your password to a service, but in this case encrypted data is "leaked" to a person requesting it. 2-FA prevents from giving this data to strangers (and won't help if the service is hacked, yes)

Fully agreed. The website delivers Bitcoin as a average-consumer-frienldy. If bitcoin becomes mainstream, it will soon collapse under the weight of careless users.

I would rather see a site solving some of the critical concerns raised by average-user's ignorance.

> 1. Software that he uses actually encrypts wallets (BitcoinQT by default does not!).

Are you sure about that? Can you point to a discussion where it says BitcoinQT doesn't encrypt by default. Googling found me nothing.

You have to turn it on. If you create yet another wallet, it's easy to forget that.

tl;dr, you are responsible for your bitcoins.

People applying to YCombinator should adopt your approach.

"Of course our startup is user-unfriendly! We hate users! People should just get used to it."

And your goal (after precautions!) of "not losing everything" - wondrous! Every day I wake up and I haven't lost everything is a good day.

This revolutionary approach will certainly succeed.

His point is that you HAVE to be used to it. There is no 'person' that can recover your password for you in these cases.

My point is about current state of affairs. And it sucks the way it is today. I want a wallet app for my parents which will make sure it is backed up and the key is split via SSSS and sent out to 5 of their friends before they even see the address to move money into. That would be better UX.

Today you can launch the wallet, send money to it right away and then immediately forget your password or have a disk crash. This sucks and people will be hurt.

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