What is a paper wallet and what are its risks?
A paper wallet is a printed private key or seed phrase kept offline. Anyone who sees the paper can spend the crypto, and losing it means losing the funds.
Vahe HakobyanEditor-in-chief
Updated Oct 5, 20263 min readFact-checked
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- A paper wallet holds a public address and a private key.
- Anyone who sees the private key can spend the crypto.
- Paper can be lost or damaged, with no recovery.
- A hardware wallet keeps keys in a chip and usually uses a PIN.
The idea is to keep keys away from the internet. A paper wallet is one low-tech way to try that.
What is a paper wallet?
A paper wallet is a printed or handwritten copy of a private key or seed phrase. It keeps that secret offline, out of reach of hackers. It is not a wallet app or a physical coin.
How does a paper wallet work?
A paper wallet shows two pieces of text. One is a public address that you share to receive crypto. The other is a private key or seed phrase that spends it. The private key is the secret that authorizes a transfer.
- The address receives crypto from other people.
- The private key signs spending transactions.
- A QR code holds the same text as the key.
- An address usually works on the network it was made for; some compatible networks share formats.
What are the main risks?
A paper wallet removes online threats, but it creates physical ones.
Paper wallet vs hardware wallet?
A hardware wallet is a small device that stores keys and signs transactions internally. It is not just a physical medium. Most models use a PIN, and many keep keys in a secure chip.
Frequently asked questions
Some people still use them for offline storage, but hardware wallets are more common.
No. A key made for one network usually will not work on another, though compatible networks can share formats.
It is possible with dice and a conversion method, but mistakes are easy and weak randomness can expose the key.
Yes, if the network supports the address. The same private key controls anything sent there.
