Bitcoin wallet locked

Since you‟re looking after your money yourself, and there‟s no built-in backup in case something goes horribly wrong and your money is lost or stolen, it‟s important that you keep your BitCoin wallet locked up and backed up.

Bear in mind, though, that some of the steps involved are quite advanced. If you‟re not at all confident in your abilities with a computer, I‟d suggest leaving this bit alone. As a general rule, if you have no idea where or what the Terminal is, you probably shouldn‟t be using it.

Windows

First up, you‟ll want to make a Virtual Encrypted Disk using TrueCrypt. Just use the basic settings, and don‟t worry about making a dynamic disk – you really don‟t want anything going wrong with it! Ideally the VED should be around 100MB in size to accommodate any large increases in file size in the future. Save the VED file to DropBox so that it‟s automatically backed up!

Before we start working with the files, start up BitCoin and take note of the receiving address. We can use this to verify that it is using the data properly.

Once you‟ve done that, it‟s just a case of finding the folder where the BitCoin client stores all its files (including your wallet file). You can usually find this by going to Start > Run (or by pressing WinKey + R and typing in the following:

explorer %APPDATA%Bitcoin

This is the default location for BitCoin data:

C:Documents and SettingsYourUserNameApplication dataBitcoin (XP)

C:UsersYourUserNameAppdataRoamingBitcoin (Vista and 7)

Once you‟ve found the folder, copy the entire folder into the VED that you created earlier. Take note of the drive letter you assign to the VED – you‟ll be using this in a bit when you tell BitCoin where to look for its data. For this example we‟ll assume that the drive you have selected is the E: drive.

Once you‟ve copied the files over, create a temporary backup of the file, then delete the original file from the Appdata folder. This will force the BitCoin client to use the VED as a source if everything has been done correctly, otherwise it will simply create a new folder to replace the one that was deleted.

Now that you‟ve finished moving files around, you can create a new shortcut to start the BitCoin application. Find BitCoin in your Start Menu, right click the shortcut and choose “Send to > Desktop (create shortcut)”. Then right click the shortcut you just edited and click “Properties…” and enter in the following in the “Target” field:

C:Program FilesBitcoinbitcoin.exe -datadir=E:Bitcoin

Don‟t forget to change E: to the drive letter you assigned the VED. Also, if you‟re using a 64-bit version of Windows, you‟ll need to change