Could you imagine having hundreds of thousands of dollars in Bitcoin stolen from you because you didn’t keep it secure? So how to store the crypto safely? Where to store cryptocurrency? Today we’ll discuss cryptocurrency wallets. So if you’re curious on where and how you can store your Bitcoins digitally this is going to be your number one resource.
Why do you even need a cryptocurrency wallet? Bitcoin is a digital currency, and as BTC doesn’t actually exist in physical shape or form, so they can’t be technically stored anywhere. A Bitcoin wallet is actually a device that stores your public and private keys, which are used to publicly access your Bitcoin address as well as your private key using it as a transaction signature. All this makes a transaction with this digital currency possible.
All coins have their blockchain. And each token uses a different crypto blockchain. Therefore, when deciding on a crypto wallet, take into account which network blockchain is used by a given digital currency or token. So if we put tokens in the Ethereum network on a cryptocurrency wallet adapted to store NEO network tokens, we may lose them. In the crypto world, we act individually and have our own resources. It is up to us to ensure their security and properly executed transfers. At the beginning, you have to find out what blockchain is based on which crypto you have.
Then find out what cryptocurrency wallets are adjusted to the digital currency you want to store. There are several types of Bitcoin wallet. That is why we will discuss each one of them to better understand how they work.
Cold wallet is a wallet where private keys are encrypted offline. This means that the private key was generated on a device that had no Internet access. A properly created offline wallet is resistant to hacker attacks, but is relatively difficult to assume.
Hot wallet is the opposite of cold wallet – the private key has been generated on a device that has access to the Internet. This type of wallet is much more popular and the vast majority of crypto owners decide on such a solution.
The first one is a paper wallet essentially. It’s a piece of paper with your public address and your private address on it. Now, they’re not just written out full-on addresses. Paper wallets are actually usually printed out in QR codes that you can quickly scan and people can get your address.
You can use services like bitaddress and Bitcoin paper wallet. The main advantage is that the keys are actually stored offline which makes them immune to hackers. The main disadvantage, however, is that a paper wallet can be stolen because it’s a physical piece of paper.
The next type of wallet is mobile wallet. The main advantage of having a mobile wallet is that your phone is always with you and if you need to buy or sell on your mobile device or use it as a mobile payment, this is all possible because your phone is always with you.
The main disadvantage of it being on your phone, is that phones get stolen and can become compromised because it uses a second form authentication that gets sent through text and the person that stole your phone has access to your texts. The last cons is that it takes up a lot of storage space on your phone because you actually need to hold a condensed copy of the blockchain ledger. In the market, we find some options like the Coincasso Mobile Wallet as well as Freewallet, Edge, Lumi wallet, and Blockchain Wallet.
The next and most common type of wallet is actually a desktop wallet. These wallets are actually downloaded and stored on your computer’s hard drive. So you can even access them without being connected to the internet. They are more secure than online wallets because they don’t rely on third-party data.
The last wallet on our list is actually hardware wallets. These devices store your public and private key on an actual physical device not connected to the internet. Just like a USB flash drive, but much more sophisticated. The top three hardware wallets are actually Ledger Nano S, Trezor and Keepkey and those are the basic wallets. There are pros and cons to each one.
A lot of People have different platforms that they keep their Bitcoins on. Commonly, what most people do is actually use their trading platform like CoinCasso, do their transaction, make sure that that transaction gets processed, and they are in possession of their Bitcoin or other cryptocurrencies, and then transfer that amount to their desktop wallet.
That seems to be the most common and most secure way to do it. You can also move it to any of these other wallets like the hardware wallet.
The safety of your cryptocurrency should be a priority. There are several interesting solutions on the market on how to store your crypto properly. Consider which solution will be best for you. You can use paper wallets, desktop wallets and hardware wallets. And remember that although you may not have too much BTC, its value is still growing, so it is not worth risking its loss.