The first step of starting crypto-trading is buying digital currency from one of the reputed exchanges and the second step is to store them on a secure location. In case of crypto-currency, this secure location is called Wallet. The wallet is a place where your digital currency is stored; you can also send and receive money through your wallet. Cryptocurrency Wallets-Ninja Tips on Choosing the Safest Wallet for Your Digital Currency.
E-wallets are different from the wallets that we normally use to keep our fiat currencies. It is in-fact an address of the location where your digital coins are stored. This address routes us to where our digital currency is stored, Just like www.informationistan routes us to our own website.
Private and Public Keys
These wallets have two addresses, one is called a private address and the other is called a public address. On both of these addresses our private and public keys are stored. The keys are used to execute your transactions. We use private keys to login to our wallet and use our wallet with full rights, using private key we can send money to anyone and check our balance and statement. On the other hand, public key is only used for receiving money. For example, if someone wants to send money to your wallet, he needs to have your public address where he will send it.
As we know that private key is just like our PIN or Password so we should never give it to anyone. Anyone having your private key can easily steal your money or do whatever he want with our account.
Cryptocurrency Wallets-Ninja Tips on Choosing the Safest Wallet for Your Digital Currency
We will describe how to store your crypto currency in detail in the following debate.
Types of wallets
So far we have just learnt what these wallets are, now we will elaborate on different types of wallets and their security features. Remember, the first thing that we should consider before choosing any wallet is its security features.
E-wallets are different from the wallets that we normally use to keep our fiat currencies. It is in-fact an address of the location where your digital coins are stored.
We can’t undo a transaction, so if we mistakenly sent the money to any account, it can never be reversed. Hackers can break into the defenses of your wallet security and can rip you off your fortune. We emphasize on purchasing a secure wallet because of our concern about your money. Digital currency market is decentralized which means there is no regulatory body or any financial institute keeping a check on its working. No one can give you security of your funds except you, and you can only secure them by using the best cryptocurrency wallets as your first and last line of defense.
The exchange from where we buy Bitcoin or any other digital coins offers us to purchase wallets. These wallets are called online wallets because they are stored on their server. Online wallets are least recommended for their security features. They are vulnerable to hackers and not the best place for your hard earned money.
Mobile wallets, as the name suggests, can be downloaded to your mobile phones. It is convenient to have a mobile wallet for sending and receiving your Bitcoins but we are talking about the security not the convenience. You are still vulnerable to hacking, mobile dysfunction or lose. In any of the case, you will lose your money. There is no way to retrieve you amount even if you have just lost your Smartphone or it became faulty. However, you can choose it if you are a frequent trader.
The imitation of every popular wallet is present on the online stores. You need to be careful while downloading your mobile wallet and ensure that you have chosen the one you wanted and not its copy or imitation. These scammers have designed these copies to snatch your money.
Desktop wallets are for your Desktop computers. This wallet performs all your transactions just like any other wallet. The only thing that separate one type of wallet from the other is its security features. But there is an option for the desktop users to store their digital currency. Remember, anything that is connected to internet is vulnerable to hacking.
Hardware wallets are a bit different from all of the wallets discussed above. They come in a shape of hardware and give you a more secure option to save your digital currency. The only concern about their security is their malfunction. If the hardware gets faulty, you can’t access your private and public keys and thus losing all of your money.
Paper wallets are offline wallets and therefore the safest of all the options discussed above. These wallets are as simple as writing down your private and public keys on a piece of paper and storing them at a secure place inside your house.
Here you must be confused about performing your transactions on paper wallet. Lets recall, wallets are just an address to the location where your money is stored. No wallets stores your physical coins, all of them store an address. So you can perform all your actions by accessing your account by using the private and public keys.
The security threats are of different types. In this case, you are safe to hackers, but if you lose your paper and it gets burned or tear apart, you will be waving a goodbye to your precious money.
Before pulling the handbrake, we can’t recommend any single type of wallet because each trader has its own priorities and convenience level. The frequent traders find it easy to use mobile wallet while less frequent traders would go for desktop wallets. The ones who only do long term trading while prefer paper wallet. Therefore, it is hard to recommend a solution that meets all your needs but you have to choose it carefully because it is the most important part of your crypto trading.
To conclude the debate, it is plausible to see your trading needs before opting for a wallet.