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Sikh Bitcoin · Beginner · Lesson 2 of 21

Keys, custody and keeping control

Understand who can authorize spending, what must stay private and why a backup matters.

About 9 minutes with practice. You only need something to take notes with. No real wallet details or payments are part of this lesson.

Course contents · Lesson 2 of 21
  1. Bitcoin without jargon
  2. Keys, custody and keeping control
  3. Payments for humans, including Lightning
  4. Money, prices and units
  5. Follow a payment from request to receipt
  6. Addresses, networks and QR codes
  7. Confirmations and patience
  8. Fees buy scarce block space
  9. Backups before dependence
  10. Scams, urgency and trusted routes
  11. Privacy is a practice
  12. Custody is a relationship
  13. Reading a Lightning invoice
  14. Exchanges and access to bitcoin
  15. Volatility and practical planning
  16. A fair invoice for creative work
  17. Donations with accountable purpose
  18. Proof of work and honest energy questions
  19. Bitcoin and Litecoin: related ideas, separate networks
  20. Read Bitcoin news with a source trail
  21. Capstone: welcome a newcomer safely

What you will learn

  • Distinguish receiving information from a wallet secret.
  • Describe the responsibilities of self-custody and the dependence of custodial use.
  • Reject a dangerous support request without needing a wallet demonstration.

The wallet and the keys do different jobs

A wallet is software or a device that helps manage the credentials used to authorize spending. It does not store little digital coins inside your phone. The network records transactions; your keys let you authorize spending the funds they control.

A receiving address can be shared with someone who needs to pay you. A private key or recovery phrase is different: it can give someone the power to spend. A public username is not a recovery method, and knowing your address does not give a helper permission to move your funds.

Read the source: Bitcoin developer guide · Wallets

Know who holds the authority

With self-custody, you hold the credentials and take responsibility for protecting and recovering them. Losing the only usable backup can mean losing access permanently. A custodian holds funds on your behalf; you depend on its security, solvency and withdrawal policies.

A friendly interface does not tell you which model you are using. Before choosing a real wallet, read its own documentation: who can authorize a payment, what happens if the provider disappears, and how recovery works. This lesson is a way to understand those questions, not a recommendation to move your money.

Read the source: Bitcoin FAQ · Wallets and self-custody

A backup should remain under your control

Wallets have different backup designs. Follow the documented recovery process for the wallet you choose and understand it before depending on it. Recovery information belongs in a secure, private backup—not in a public document, cloud screenshot, support chat, AI conversation or GitHub issue.

For this course, use invented labels on paper such as “receiving address” and “private recovery information.” Do not write a real recovery phrase in an exercise. Satnam Satoshi never needs it to teach you, invite you to a meetup or offer you a meal.

Read the source: Bitcoin.org · Securing your wallet

Protect privacy as well as access

Bitcoin transactions are public. Publishing a name beside an address can make that person’s activity easier to follow. Only share receiving information where it is needed; avoid posting someone else’s payment details or a screenshot of their wallet without permission.

If an unexpected message asks you to “verify,” “synchronize” or “unlock” a wallet by exposing a secret, stop. Return to the service through a known address rather than following the message. Urgency, a familiar logo and a helpful tone are not proof of legitimacy.

Read the source: Bitcoin.org · Things you need to know

Sort three requests

Consider: (1) an artist gives a buyer an invoice; (2) a stranger asks for a recovery phrase to release a reward; (3) an organizer asks permission to publish a volunteer’s wallet address beside their name. Which request is a clear secret-exposure risk, and which needs a privacy decision?

Reveal the worked answer

Request 2 exposes a secret and should be refused. Request 3 needs freely given consent and a good reason; public recognition should not require publishing a wallet. Request 1 is a normal payment request in principle, but the buyer must still check the recipient, network, amount and agreed terms.

Check your understanding

Choose an answer in your head or on paper, then reveal the explanation. Retry whenever you like. Answers are not submitted or scored; completion marks are your own learning notes.

1. What does self-custody require?

  • A. Giving a community administrator a recovery phrase
  • B. Protecting your own spending credentials and a usable backup
Reveal answer 1

B. Self-custody gives you control and responsibility. A community administrator does not need your wallet secret.

2. Does an account balance at a custodian remove dependence on that company?

  • A. Yes
  • B. No
Reveal answer 2

B. You still depend on the custodian’s operations and ability to honor withdrawals.

3. Where should you enter a real recovery phrase for this course?

  • A. In an AI chat
  • B. In a public issue
  • C. Nowhere
Reveal answer 3

C. Nowhere. The lesson uses paper examples and never asks for a real wallet secret.

Take this with you

Know who can spend, know how recovery works and keep private credentials private.

Your learning, at your pace

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