What is a Crypto wallet and why do you need one?
#CryptoEssentials: What is a Crypto wallet and why do you need one?
A Cryptocurrency wallet, or crypto wallet, is a piece of software that allows you to send and receive cryptocurrencies like Bitcoin or NEO. If you’re looking to get into cryptocurrency trading, you’ll need a crypto wallet before you start.
Unlike the physical wallet you might carry around with you, your digital wallet doesn’t actually store your currency. Instead it stores private and public keys. Your tokens are actually stored on the blockchain.
Public keys are the equivalent of your postal address. If you want someone to send you a letter, you give them your address so the letter can reach you. However, Private keys are exactly that, private. Your private keys should be treated the same as your house keys – you wouldn’t give them to a stranger, would you?!
When someone sends you some cryptocurrency, they use your public address. You then use your private key to get access to it. If the private and public keys match, the balance in your digital wallet will increase and the balance in the sender’s wallet will decrease. When completed, the transaction is recorded on the blockchain.
Before you choose your wallet you definitely need to do a bit of homework. Make sure that the wallet you’re looking at supports the currencies you want to trade and that it has a good reputation for being secure and trustworthy. Read up on each of the wallets that you’re considering, weigh up the pros and cons, such as cost and security levels, and take your time to make the right decision for you. Once you’ve done your due diligence and found a wallet that meets all of your needs, you need to get it set up.
Each crypto wallet will have their own step by step guide on creating them so following the steps should be fairly straight forward for you. Once you’ve created your wallet, make sure you make a copy of your private key and keep it safe.
The security of your private keys is crucial. There’s no point spending the time pouring over your investments to find that your private keys have been compromised and the profit you would have made has now disappeared.
There are some simple things you can do to keep your private keys and your currency safe:
- Firstly, NEVER share your private key with anyone.
- Don’t keep all of our currency online and in the same place. Research offline wallets to add an additional layer of security
- Be careful about downloading or allowing unknown software access to your computer or phone. Following the usual security steps when online and ensuring your anti-virus/malware software is up to date will help
- Be mindful of emails and messages from people claiming to be your wallet provider. These emails can at times be very convincing so be sure to double check the email addresses that they’ve been sent from for typos or slight changes from the original. Legitimate emails from your wallet provider will often contain bits of information that only they will know.
- Finally, and just reiterate, NEVER share your private key with anyone and keep it safe. If you lose your key, you’ll lose your crypto.
So, now you understand what a crypto wallet is. You’ve researched the wallets that are available to you and found one that meets your needs. You’ve set your wallet up and taken steps to make sure your private key stays secure. Now all that’s left to do is get trading. If you get stuck or have any questions, drop us a message via the social channels below or directly to our support portal. Good luck!
Coinage is is here to make cryptocurrency investing easier, safer, stable and more transparent for seasoned traders and newcomers alike.
Coinage is a new kind of cryptocurrency company that is set to change the way we view and access crypto trading. We aim to make cryptocurrency investing easier, safer, stable and more transparent for seasoned traders and newcomers alike. To help get you started on your crypto journey, we’ve developed the #CryptoEssentials. A series of blogs designed to give you all the information you need to start trading cryptocurrency. If you have any questions about the #CryptoEssentials, the Coinage Exchange or anything else Crypto related, feel free to get in touch with us.
If you found this article useful why not take a look at the other articles in our #CryptoEssentials series below. If you have any questions about anything crypto related, drop us a message via our social channels.
For more information about Coinage or the Coinage Exchange go to GetCoinage.com
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- #CryptoInsights: Diversifying Your Portfolio – Part 1
In this edition of the #CryptoEssentials, we take a look at what are Privacy coins and do you need them? … Read More