How to safely store cryptocurrency

Whether you’re just beginning to explore the crypto industry or already a skilled trader, you need a place to safely store your cryptocurrencies. Finding the right wallet can be challenging, especially with the various options available in the market.

Here is a comprehensive guide in storing cryptocurrency to help you navigate through the crypto world.

What are crypto wallets?

Crypto wallets are devices that let you transfer and store cryptocurrency. These come in various forms where you can access different types of coins or a specific cryptocurrency.

To send and receive your funds, crypto wallets make use of public keys, private keys, and a wallet address that is shared with other users to complete transactions.

Types of crypto wallets

There are different types of wallets according to the method of storing, and they offer various features and advantages suited for different kinds of users:

Hot wallet

Hot wallets are accessed through a computer or mobile application best suited for people who engage in regular trading. With this type of wallet, as long as you are connected to the internet, you can quickly manage your funds.

• Mobile wallets

Due to its convenience and accessibility, this type of wallet is suitable for those who often make daily transactions. With mobile wallets, you can access your assets using a mobile phone through the touch-to-pay system and near-field communication (NFC) so you can make trades anywhere and anytime.

• Web wallets

With a web wallet, you can manage your cryptocurrencies through a laptop or computer using an internet browser. You can also store your private keys in non-hosted or hosted platforms such as MetaMask, Blockchain and Coinbase for additional security.

Cold wallet

As opposed to hot wallets, cold wallets include physical equipment that can be accessed offline. Cold wallets are ideal for people who are interested in long-term investments since these types of wallets secure your funds away from online attacks and other threats on the internet.

• Hardware wallet

This refers to hardware devices where your public keys and addresses are stored. You can access hardware wallets by connecting them to your laptop or desktop using a USB cable. Since this wallet lets you store your coins offline, they are considered the most secure type of wallet.

• Paper wallet

This wallet comes as a piece of paper where a unique QR code is printed. Since it’s not connected to the internet, your code must be scanned to complete a transaction.

Why use a crypto wallet

Check out these key features of crypto wallets that make them safe and reliable in storing your digital assets:

Security

Crypto wallets use multiple safety measures such as a recovery phrase, PIN code, two-factor authentication and password management. Most wallets use verification requests to alert you of unauthorised access attempts.

Convenience

You can have a hassle-free experience with managing your assets through a crypto wallet. Moreover, you have complete control and access over your funds compared to storing them in centralized exchange sites that are often subject to hacks and breaches.

With the wide variety of crypto wallets, each with its own functionality, you can choose whichever type is suitable for your trading activity or investment.

Accessibility

Many crypto wallets are optimised so that all kinds of users can easily access the wallet features. Whether you’re a beginner or an experienced user, the intuitive interface of these wallets allows you to handle your assets without difficulty.

How to set up your crypto wallet

Once you have chosen the type of wallet that suits your needs, you must learn how to set it up. Here’s how to use crypto wallets depending on their classification:

Paper wallet

Since your crypto coins are stored offline, you can simply print your public address and private key on paper. To ensure that it’s safe from damage, you can place it in a waterproof bag or container or use a personal safe as storage.

Online wallet

In setting up your online wallet, you can use an internet browser on your computer or install an application on your mobile device.

Depending on the wallet that you wish to use, you may be required to input different codes to access your assets. For instance, some wallets feature a two-factor authentication code or a 12-word phrase before you can open the application.

Hardware wallet

To set up your hardware wallet, you need to use a USB cable to plug the device into your computer. Connect your computer to the internet and create a new wallet or import an existing one. You can then assign your PIN and recovery phrase. Afterwards, install the wallet’s browser extension or download it directly to your computer.

Exchange platform as a wallet

Many exchange sites automatically create a wallet once you purchase some coins. You will only need to enable the platform’s 2-factor authentication to keep it secure.

Best crypto wallets

With all the wallets available in the market, it can be difficult to know which ones best suit you. Here some of the best crypto wallets you can try, each with unique features that can cater to your various trading needs:

Coinbase

Coinbase is one of the leading exchange sites that provide reliable services and offer insurance on the assets stored in their servers. Aside from keeping your coins safe, it has an intuitive interface that accommodates beginners and experienced users alike.

Exodus

If you want an easy-to-use wallet where you don’t have to sign-up or register, you can try the Exodus wallet. It is a mobile and desktop wallet that offers fast and smooth exchanges through its Simplified Payment Verification system.

Jaxx

A multiplatform blockchain wallet, Jazz is easy to use and allows users to manage their funds across several different devices. This wallet features a 12-word backup phrase and supports more than 90 cryptocurrencies.

Trezor

Trezor is a hardware wallet that keeps your cryptocurrencies secure using the 2-factor authentication feature and their next-generation password management application. It also provides a recovery key to minimise losses and the risk of private key disclosure of malware attacks or online breaches.

Electrum

A popular blockchain wallet, Electrum is known for its multi-signature feature where you can manage your Bitcoin using numerous wallets. Additionally, with its reliable system that doesn’t have any downtimes, users like you can make quick and easy transactions anytime and anywhere.