Any bitcoins you might have are constantly in danger of either being stolen due to weak security or lost due to computer failure. Because of this, it is wise to keep multiple backups in very secure places.

Imagine you have a large sum of money stored in an impenetrable safe. This safe is in a public area that everybody has ready access to and is protected only by a combination so long that it is unguessable. You can’t possibly remember the combination to the safe, so you have to write it down. In the Bitcoin world, your bitcoins are the large sum of money, the safe is the blockchain and the combination is your private keys stored in your wallet.

There are two ways that you can lose your bitcoins. If you lose your combination, the safe will never be opened by anyone. If anyone finds out your combination, you risk having your coins stolen. On the one hand, it is smart to backup your combination in multiple locations to ensure that you don’t lose it. On the other hand, if any backup of the combination is compromised, all your coins are gone.