With all the news around Bitcoin, I wanted to give a brief update on Film Annex's use of "Cold Storage". As of today, we have purchased most of the bitcoins that we need for 2014, and we have 93% of them in Cold Storage, which is the process of taking money that is connected to the internet and moving it offline for safe keeping.

The other 7.0% of our bitcoins are in two transaction wallets. One at Coinbase, and a second wallet that I will not disclose for now. Coinbase describes their "Cold Storage" process here on their Blog, and they have approximately 87% of their Bitcoin in Cold Storage:

"During a normal week, the largest transaction on Coinbase might only account for 5% of total customer deposits.  So it’s not necessary to keep 100% of funds available at any given time.

Instead, we can safely move about 90% of those funds offline.  We do this by taking the sensitive data that would normally reside on our servers (the “private keys” which represent the actual bitcoins) and moving it to USB sticks and paper backups.  We then take these to a safe deposit box at an actual bank.  In this case we use the bank more like a vault instead of for storing any traditional currency."

Thus, if you have an account with Film Annex or Women's Annex, over 90% of your Bitcoin money is safe in cold storage. Any delays that we have had have been from shifting our accounting systems, and remember to look for us at Inside Bitcoins on April 7-8, 2014 at the Javits Convention Center.

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Mike Sweeney

Film Annex Networks