Security is very important when we are handling cryptocurrencies. This guide explains how to encrypt your wallet with a secure password to safeguard your wallet.
Note: this is a separate process to exporting/importing private keys and encrypting a USB stick on which your wallet.dat/private key may be stored. It simply adds another layer of protection for your funds. If someone gets hold of your private key, however, this encryption of the wallet.dat will not help.
1. Start the wallet software.
2. Go to Settings and click "Encrypt wallet".
3. It is very important that you use a strong password, as this will keep your coins safe even if someone were able to access your ’wallet.dat’ file. DO NOT lose or forget this password. Once the wallet is encrypted it cannot be undone. If you lose your password you lose all access to your coins and we can not help you access your coins again. (However you can use a backed up private key to restore your wallet.)
Enter a strong password, and make sure you have it memorised or written down on paper. Click OK.
You will be asked to confirm the encryption of your wallet. Click Yes.
A new box will appear warning you that the software will now shut down and encrypt your wallet. Click OK. Wait for a minute or two for the encryption process to finish.
Your wallet is now encrypted!
4. The next time you start your wallet software and want to send coins, you will be asked for the password. This is for sending only. When receiving, no password is needed.
Note: After encrypting your wallet, you should make a new backup. Any old unencrypted backups will no longer function.