How to Use VPN to Protect Your Bitcoins

Since its introduction in the mid-2000s, Bitcoins have become a rage in the world of finance and computer science. A disruptive technology in its own right it, cryptocurrency brings a fresh way of handling currency, which is completely different from the way the established banking system had been operating for the past 200 years. With Bitcoin, the valuation of your money depends on the market forces, with no regulatory body to determine the worth of the same. As a result, the safekeeping of your own bitcoins is dependent upon how you choose to store them. While quite a few have literally “minted” their own bitcoins, storing their bitcoin wallets as metal coins with an embedded QR code, most people use a Bitcoin wallet to store them. Since the wallet needs to be online all the time, there lies a chance of a breach of security and theft of your hard-earned money. But you can protect your bitcoin wallet by using a VPN.

What is a VPN?

A VPN or Virtual Private Network is a network of computer systems within the Internet. It allows only subscribers to log their computers onto the network, which provides a host of benefits, including:

Secure Connection to the Internet
Encryption of the connection between your computer and the VPN Server
Encryption of the connection between the VPN and the Internet.

All these benefits allow you to safely connect to the Internet without any worries.

How can you protect your Bitcoins with VPN?

Bitcoins operate on the principle of a transparent ledger, where each interaction is recorded. Everyone has access to that ledger on the bitcoin network. Therefore, when you receive Bitcoins or spend them, the activity is stored on the ledger. The ledger does not store your IP addresses or even your Bitcoin wallet information, but someone using advanced packet filtering tools can make a guess as to which IP address the transaction is coming from. A VPN obfuscates your IP address, by hiding your computer behind their IP address.

In addition, the VPN encrypts every packet that operates between the Internet and the VPN, providing packet sniffing software with garbled data that is unusable.

If you store your Bitcoins on a cloud-based wallet, the information on the wallet might not be 100% safe and might be prone to attacks. You can use a personal Bitcoin wallet and store it on a USB drive. While connecting to the Bitcoin network through a VPN, a hacker has to go through the VPN to gain access to your computer, and physically into your USB drive to access your wallet, which is extremely difficult, thus making it completely safe for the users.