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0 sats \ 0 replies \ @ionisle 22 Sep 2023 \ on: Moving from hot to cold wallet bitcoin
Best Security Practices for Moving Bitcoin to a Cold Wallet:
  1. Create a New Cold Wallet:
  • Use a reputable hardware wallet.
  • During the setup, you will be provided with a new set of 12/24 recovery words (seed phrase).
  • Write down the seed phrase on paper and store it in a secure location. Do not store it digitally to avoid hacking risks. Or use the @darthcoin poetry standard to remember/memorize your seed phrase.
  1. Secure the Seed Phrase:
  • Store the seed phrase in a fireproof and waterproof container or safe.
  • Consider using a metal backup tool like Cryptosteel or Billfodl to store the seed phrase, as it is more durable than paper.
  • Do not share the seed phrase with anyone and avoid entering it on online platforms or taking pictures of it on your phone.
  1. Whirlpool
  • Before sending your Bitcoin to the cold wallet, use a CoinJoin service like Whirlpool by Samourai Wallet to mix your coins.
  • This step enhances your privacy by breaking the link between the input and output addresses, making the transaction trail harder to analyze.
  1. Generate a Receiving Address:
  • Connect the cold wallet to a safe computer or use its interface to generate a new receiving address.
  • Double-check the address to ensure it is correct.
  1. Send an UTXO:
  • Send one of the UTXO's from whirlpool to the address.
  • Confirm that the transaction is successful and the funds are received in the cold wallet.
  1. Send the Remaining Balance:
  • Once the test transaction is confirmed, send the remaining balance from the hot wallet to the cold wallet. (Be sure each UTXO goes to a new address on the wallet this way only someone with your xpub would be able to make additional connections)
  • Monitor the transaction until it gets enough confirmations on the blockchain.
  1. Keep the Hardware Wallet Secure: Store the hardware wallet in a secure location when not in use. Use strong PIN/password protection on the hardware wallet.
  2. Verify
  • Frequently verify you can access your hardware wallet ( I recommend monthly but at least when you change your batteries in your smoke detectors)
I'm sure @darthcoin has a more definitive guide on this somewhere but with my threat model this would be the way I go.
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