One cryptocurrency that had a huge run from the end of 2017 into the beginning of 2018 was Ripple (XRP). Indeed, from December 11, 2017 to January 4, 2018 the price of Ripple went from $0.25 per XRP to a high of $3.78 in less than a month!
In other words, the price increased by a multiple of 15. Just having $1,000 worth of Ripple at the beginning of that period and waiting a bit over 3 weeks would have turned that $1,000 into a little over $15,000 – not a bad Christmas present.
Naturally, with Ripple’s price shooting up so drastically, investors in the #3 cryptocurrency by total market capitalization (as of March 16, 2018) want to protect their investment and find safe ways to store it. While some users prefer “hot wallets” for securing their digital assets, “cold wallets” are often considered safer than hot wallets for holding onto cryptocurrency.
The key difference between hot wallets and cold wallets is that cold wallets are not connected to the Internet. Examples of hot wallets include cryptocurrency exchanges and software wallets.
A cold wallet would be something like a hardware wallet (usually only connected to the Internet to make transactions), or a paper wallet.
Since cold wallets are safer than hot ones, investors looking to hold their Ripple for a long time without spending it should consider them for safe and secure storage of their assets. What, then, is the best cold storage wallet for Ripple?
Important: Read Before Setting up Any Ripple Wallet!
Before you set up a Ripple wallet, cold or otherwise, know that you need 20 XRP to generate a Ripple wallet address (where you store your Ripple).
While it is good to diversify your storage methods so that if one method gets compromised, you still have funds in other places, this could be an inconvenient practice since you need to allocate 20 XRP as a “placeholder” for each wallet (the wallet requires a minimum balance of 20 XRP at all times to work).
This only applies to addresses that you own and have the private keys to, granting you access to the wallet from any wallet that can interact with the Ripple ledger. It doesn’t apply to addresses on places like most exchanges, where the exchange has the private keys and not you.
Since you own the private keys to cold wallets, it might be in your interest to not set up that many of them unless you are comfortable with allocating 20 XRP to each cold wallet that you make.
The Best Ripple Cold Storage Wallet: Setting up a Paper Wallet
Although paper wallets are a bit more complicated to set up and maintain than other types of wallets, there is no doubt that they are the most secure type of wallet and since people looking for cold wallets are concerned about security, they are no doubt the best option for cold storage of Ripple.
Here’s how you can get started setting up your Ripple paper wallet:
- Go to https://bithomp.com/create or https://octillionsa.github.io/generate-ripple-wallet/ and hit “Generate” to generate your Ripple wallet address and wallet secret key. To use the analogy of a PayPal account, the address is your PayPal address or email (where people can send you money) and the secret key is your username and password (how you access your account in order to send funds and so on).
- Make a note of your address and secret key. For your secret key, write it down on a PIECE OF PAPER (hence the name “paper wallet”)! For extra security, write the secret key down on multiple pieces of paper so that if you lose one, you don’t lose everything. Store the piece(s) of paper in a secure place – most people opt for a safe deposit box.
- If you want to monitor your wallet balance from time to time and make sure that nothing fishy is going on, go to Ripple’s account explorer and enter your wallet address to see your current balance and transaction history.
- When the time comes and you want to access your wallet and do things like send Ripple to another wallet, you can access your paper wallet with a Ripple client such as this one. It can be accessed offline with the offline version by downloading the .zip file, extracting it to your computer with something like WinZip and opening index.html). Note: do not use the client listed with the Safari browser, as users have reported bugs when doing so. Use other browsers like Chrome or Firefox.
- In the field “secret” enter your secret key and hit “set identity”. Your public key (wallet address) should then be displayed.
- Click “connect to ripple” – note this is an online action that involves using an Internet connection! When doing this, we recommend using a trusted computer with a trusted Internet connection – for example, use Tor and/or a Virtual Private Network (VPN) to obfuscate (encrypt, hide, etc.) your Internet traffic.
- Once you are connected, you can go down to the send payment section to send payments to other Ripple addresses and so on.
- (For sending Ripple to another Ripple wallet)
- Check the “direct xrp->xrp” box
- Enter the amount of Ripple you want to send
- Enter the wallet address you want to send Ripple to in the field “destination”
- (Optional) check “use optional fields” and enter a destination tag if you were told to or if the Ripple address you’re sending to has one (you would know if this was the case).
With Ripple recently becoming exponentially more valuable than it was just a few months ago, many Ripple investors are feeling the pressure of having to find more secure storage options for their investment.
Cold storage is the best option for those who want security, and the paper wallet listed is the best cold storage wallet available for storing your XRP.