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Is Paper Wallet A Real Thing In The Crypto Industry?

By December 13, 2022December 19th, 20223 minute read

The rise in Crypto fraud and cybersecurity risks emphasizes the importance of keeping your Crypto secure. Due to their offline asset storage, hardware wallets have become the benchmark for self-custody in the Crypto sector.

However, paper wallets are still a traditional method of securing crypto, although being less common today.

Other alternative non-custodial cold storage techniques have replaced paper wallets, which were formerly the gold standard for storing your Cryptos offline. Some Crypto fans, even today, wouldn’t keep their digital holdings in any other way!

In this article, let’s learn about the paper wallet.

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What is a paper wallet?

To put it simply, paper wallets are a form of offline cold storage for storing crypto. It means printing your public and private keys on paper, which you should then securely store and put in a safe place. The keys have QR codes printed on them that you can scan in the future to complete all of your transactions. It is highly secure since it provides you, the user, total control. You don’t need to worry about malware or hackers, nor do you need to worry about the good condition of a piece of hardware. It’s merely a piece of paper that needs your attention.

Benefits of using a paper wallet

  • Offline storage

A paper wallet eliminates the need for internet accessibility. As a result, hackers and malicious attackers won’t be able to take advantage of your Crypto holdings. In addition, it’s almost difficult to steal the assets kept in a paper wallet unless someone manages to get their hands on the actual paper you printed while creating the wallet.

  • Low-cost

You only need pen and paper to create a paper wallet (or easy access to a key generator, after which you can print the addresses generated).

  • Easy to create

Generating a paper wallet is a simple process if you employ a wallet key generator. Create your private key by logging in to a secure wallet key generator and entering a string of randomly chosen alphanumeric characters. Print the paper wallet after it is generated, then keep it securely.

Drawbacks of using a paper wallet

  • Vulnerability

The fact is that it is paper. Paper can easily be destroyed, and it can also degrade with time. You should always create multiple backups due to this.

  • Easy to steal

Anyone who can access it or take a picture of it can steal your money because it is printed on a piece of paper.

  • Not immune to disasters

It is only a piece of paper; it is not resistant to natural disasters, and if you have not taken any backups, you can lose your Crypto holdings, just like that in the case of disasters.

  • The quality of the printer used.

The quality of the printer chosen could also be damaging. Non-laser printers could cause the ink to run if the paper gets wet.

  • Human Errors

Humans are prone to make mistakes, so it’s easy to forget where the paper wallet is kept or accidentally damage that piece of paper.

Is using a paper wallet easy?

Using a paper wallet is simple and hassle-free. Users only need to:

  • Generate a wallet address.
  • Create the paper wallet in print.
  • Deposit Cryptos to the public key address.

In alphanumeric and QR code formats, addresses are frequently included in paper wallets.

A user must import or sweep the private key in order to spend money from a paper wallet. To do this, a user must set up a digital wallet on their computer or mobile device that enables the import of private keys.

In general, Crypto exchanges do not support this feature.

Bottom line: Are paper wallets a secure option?

At one point, paper wallets were the safest way to store crypto. If you don’t have any other storage options, it’s still a valid way to keep your tokens safe. However, unless you have access to another method of storing them, you should think of it as a temporary solution.

Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
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Harshita Shrivastava

Harshita Shrivastava is an Associate Content Writer with WazirX. She did her graduation in E-Commerce and loved the concept of Digital Marketing. With a brief knowledge of SEO and Content Writing, she knows how to win her content game!

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