2 mins

5 Different Types of Cryptocurrency Wallets to Store Your Digital Money

Avatar newsbtc 1 year ago

It’s Invest Diva’s  Kiana Danial https://www.investdiva.com/ with News BTC and in today’s educational piece, I’m gonna talk about cryptocurrency wallets. A cryptocurrency wallet, aka a digital wallet, is a software program that stores your digital money. More specifically, it stores the public and private keys that can be used to send and receive cryptocurrencies or to pay and get paid using digital money. In fact, without crypto wallets, the whole idea of cryptocurrencies dies! In my book, Cryptocurrency Investing for Dummies I get into details of different types of wallets and how each of them works. I also talk about how you can choose the right crypto wallet for you. In this video I’ll explore the different types of wallets out there, starting with the least secure ones. The first type of crypto wallets are (1) Online Wallets and are arguably some of the least secure ones.  An online wallet, also known as a web wallet, allows you access to your cryptos via the Internet. Advantages of online wallets include:

Advantages:

* Fast transactions

*       May be able to manage multiple cryptocurrencies

*       Conveniently use on the go and for active trading

Disadvantages:

*       Risk of online security such as hacks and scams

*       Risk of personal security such as computer viruses

*       A third-party is storing your cryptos, not you

The second type of crypto wallets is called (2) Mobile Wallets which is considered safer than online wallets. Just like Apple Pay, you can use mobile wallets when shopping in physical stores as cryptocurrencies become more acceptable. The third type is the (3) Desktop Wallets.  Another choice that can be safer than online wallets. You can download your desktop wallet and install it on your computer. Desktop wallets are especially safe if your computer is not, or even better, has never been connected to the Internet. I explain more about the pros and cons of mobile and desktop wallets in my book and on Investdiva.com. The fourth type and one of the most secure wallets is the (4) Hardware Wallets. It stores your private keys on a device like a USB drive. You are still able to make online transactions. But since they are offline most of the time, you can consider them a cold wallet, which means it isn’t connected to the Internet. Last but not least, is the (5) Paper Wallets. To use, you’ll need to print out your private and public keys. You can send funds by transferring the money to wallet’s public address and you can withdraw or send your currencies by entering your private keys or by scanning the QR code on the paper wallet.

Some of the advantages of paper wallets include:

Advantages:

*    Ultra hacker-proof

*    Not stored on a computer or mobile

*    Not stored on a third-party server

Disadvantages:

*    Not user-friendly for none-geeks

*    Harder to use for day-to-day transactions

*    They can catch fire

Check out investdiva.com and my book Cryptocurrency Investing for Dummies to explore more about crypto wallets.

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?
Nexo

Instant Crypto Credit Lines™ from only 5.9% APR - unlock your crypto-wealth tax-efficiently, without selling it. Earn up to 8% interest per year on your Stablecoins, USD, EUR & GBP. $100 million custodial insurance.

Ad
Show comments