March 30, 2020

BlogCoinz

Cryptocurrency and Technology

Crypto, What’s Your Wallet?

There are many different ways to store your cryptocurrency from paper to hardware we take a look at the different options and their advantages or disadvantages.

Exchange Wallet

Ok, let’s get this out of the way. Everyone should know that an exchange is not somewhere you should keep you crypto long term. The biggest reason is if its not your keys you do not have full control over them. There is also the risk of exchange hacks that could also cause you to lose your funds but this is still an option and good to use in certain circumstances.

First off an exchange wallet is most users first wallet. It is alright to start off with this then move on. You buy some on sites or apps like Coinbase or Cashapp and depending on how much you are buying then offload to a different more secure wallet. The other reason you might have your coins on an exchange is you are actively trading them. This is also fine but remember not to keep more than you are willing to lose as any site can be hacked and funds can be stolen.

Software/Mobile Wallet

Software and mobile wallets are practically the same in a lot of ways with mobile being an app on your phone rather than software on your computer. Software and mobile wallets generally provide multiple layers of security from sitting securely on your hard drive behind your network to having 2FA to use and log into the software. Software wallets are a great place to store crypto you want to you use either online or in person while providing you more security.

Hardware Wallets

Just like it sounds a hardware wallet is a piece of hardware you store your coins on. They generally look like a USB drive and provide the same security that a software wallet offers with the addition of being able to take it offline. If your wallet is not online then it can not be used and the only way someone then could steal your funds is by getting the same hardware wallet and using your seed phrase which is near impossible to crack.

The big reason most people like these types of devices for long term storage is you can secure the drive a multitude of ways. You can leave it in a safety deposit box, a safe, or any other favorite hiding spot.

Paper Wallet

Like it sounds a paper wallet is generally made of paper. It is a QR code linked to a wallet on the block chain that piece of paper represents an amount that can be scanned into a digital wallet later. The biggest use of these is give away at events. It is a great way to get people to look into crypto by putting $5 on a QR that they can scan into a wallet. Some people use this method apposed to a hardware wallet also as it provides the same benefits and can be stored wherever you feel it is safest. Of course, a QR does not have to exist solely on a piece of paper. Some people have gone to extremes as having them laser engraved on metal or plastic cards so they are less likely to be destroyed.

Whatever wallet you use there are lots of options in the space to store your crypto. Choose wisely and remember if it is not your keys it is not your coins.