In an announcement Coinbase said that though Bitcoin wallets are great for day-to-day spending, storing large amounts of Bitcoin for the long term requires extra security and, to cater that requirement, it has created the Coinbase Vault. From various Bitcoin hacking cases it is evident that users are asked to avoid storing Bitcoins that they are not going to use.
Understanding the inherent risk involved in storing Bitcoins in a single wallet customers have been looking for a safe place wherein they not just store them but stay assured that they won’t be hacked. Now, they have this safe storage facility in the form of Coinbase ‘Bitcoin Vault’ which according to the company is safe and secure to a great extent.
Coinbase Vault, according to the company, is trying to offer Bitcoin storage facility that helps customers sleep well knowing their Bitcoin are safe and secure as its best in class security gives them peace of mind with various options. With it they can choose ‘Time Delayed Withdrawals’ i.e. withdrawals from vault have a 48 hour window during which they can be canceled.
Similarly, customers can have ‘Multiple Approvers’ wherein joint accounts can be used for extra security, requiring multiple approvers to initiate a withdrawal. Also, Coinbase Vault has ‘Offline Storage’ wherein up to 97% of Bitcoin is stored totally offline, in geographically distributed safe deposit boxes and physical vaults.
Offline Storage of Bitcoin is safe and secure from Hacking
Offline storage has become popular as it minimizes the possibility that an intruder could steal the entire reserve in a security breach. Here the majority of the reserve is kept in cold storage, or in other words, not presence on the web server or any other computer, and the only amount kept on the server is the amount needed to cover anticipated withdrawals.
Coinbase Vault also provides several features to try to prevent fraud; for instance, it brings two-factor authentication by default, with additional factors allowed. Here customers have the option of a 48-hour delay before withdrawals are processed and like its own holdings, 97% are stored in cold storage in various geographic locations.
Best part about the Coinbase Vault service is that for now it’s free. Thus, providing cold storage and two-factor authentication, Coinbase is expected to emerge as a leading option for Bitcoiners who wish to protect their digital currency from being hacked.
To contact the reporter of this story: Deepak Tiwari at firstname.lastname@example.org