Bitcoin QT backup restore

Since there’s no other way to pay and use Bitcoins, we might as well find ways to protect the one we have: the wallet. The security of this digital tool has been, especially since Bitcoin’s boom, the main concern of the cryptocurrency development community.

You must know that if, by any chance, you lose your wallet or its password, it’s super difficult to recover it. Also, if a thief gains access to your wallet or your password and steals your Bitcoins, there’s no way to recover your money. Because of this and other overcome difficulties, a great progress has been made in the last four years, but we still have a lot to do.

You can prevent some of the risks, but a single mistake can ruin all your hard work. Let’s go through some of the recent cases of losses and thefts and check what are the possible solutions to protect your digital currency.

1. 25.000 BTC stolen

In June 2011, the Bitcointalk member known as ‘allinvain’ lost the astonishing amount of 25.000 BTC, the same as $500.000 at the time! The thief, an unknown intruder, somehow gained direct access to his computer and wallet and stole the Bitcoins, using one of two ways: either he made a transaction from ‘allinvain’s’ computer itself or just uploaded the wallet.dat file and emptied it on his own computer. What could ‘allinvain’ have done in this case? He could have encrypted his wallet, but in 2011 this process wasn’t so simple as it is now.

2. 7.000 BTC lost

Two years ago, Bitcoin developer Stefan Thomas had three backups of his wallet – in an encrypted USB stick, a Dropbox account and also in a Virtualbox– and not even all this could help him. Why? Because he erased two of these backups and forgot the password to the third one, losing 7.000 BTC forever! That was $125.000 at the time.

3. 2 BTC taken by Java application

The victim told his story : ”last night, around 9PM PDT, I clicked a link to go to CoinChat.freetzi.com and I was prompted to run java. I did (thinking this was a legitimate chatoom) and nothing happened. I closed the window and thought nothing of it. I opened my Bitcoin-qt wallet approximately 14 minutes later, and saw a transaction that I did not approve go to wallet 1Es3QVvKN1qA2p6me7jLCVMZpQXVXWPNTC, for almost my entire wallet (2.07 BTC)”, something like $300 at the time. And this coin was encrypted! But the attacker found a way around it: the Java application that the victim had opened had also asked for additional permissions and that’s the secret. As the victim agreed, he gave access to a malicious program that was able to read all of his keystrokes. Then, the application waited until he typed in his wallet password and recorded it, decrypting and emptying out the wallet.