Besides stocks, bonds, and commodities, another valuable asset has been added to the investors’ portfolios after 2009 which is Bitcoin Investment. Cryptocurrency trading has been a major part of today’s investment sector. And with this safety measures around the asset are the greatest consideration today. Just as in real life you keep your money in the purse, in the case of storing digital currency, you can use the wallets for trading in crypto.
What is a crypto wallet?
A Crypto wallet is a digital or physical form of storage where an investor’s public and private keys required for crypto transactions are stored. Besides this, the crypto wallet performs some more functions such as encryption and signing information for running smart contracts.
Cryptocurrencies are circulated totally on the digital network. If you own some cryptos you can’t hold them in your regular physical wallet just like paper currencies. When you buy a certain amount of crypto from trading platforms and many others you basically have the ownership of those cryptos on the crypto Blockchain. But, you have two separate keys to access them. One is the public key that you need to receive cryptos from others and another one is the private key that you need to send cryptos to others. Both are very confidential and must be kept safely.
About different crypto wallets
The basic functionality of crypto wallets is safely storing public and private keys but, as per some other characteristics, there are so many different types of crypto wallets we can get. The two main types of crypto wallets are software wallets are hardware wallets. However, you should be careful about hacking or any kind of online phishing when it comes to major wallet-related security activities.
Software Crypto Wallets
A software wallet is an application that provides the storage capacity of crypto trading keys. There are different wallet applications for computers and mobiles you can use at your convenience. Almost all the software wallets are hot storage because they remain connected to the internet.
Desktop wallets
Desktop wallets are applications that you can download on your desktop as well as the laptop. They provide an online data storage where you can keep your crypto trading keys and you have the ownership of those keys. You can also set a password to access the keys for adding some extra security to them.
Mobile wallets
Mobile wallets are almost the same as desktop wallets with the only difference being that they are mobile applications. Mobile wallets are convenient for use because you can make crypto transactions from wherever you are at that point in time.
Web wallets
These wallets don’t need downloading and installing. You can use these wallets through web browsers. The website keeps your trading keys and you can access them with your password.
Unlike desktop wallets, in this case, the website has the ownership of your keys. However, you need to have the right internet connection and cloud storage option to check the safety of the coins that you put in the wallet.
Hardware crypto wallets
Hardware wallets are just the opposite of software wallets. These are physical devices that you can store offline. In this device, the crypto trading keys are kept. The device doesn’t need an online connection to store keys or to work.
Comparison and safety factors
To compare software and hardware wallets the first thing that comes to mind is software wallets are connected to the internet and so, they can be hacked like any online app or website. Though they assure to keep the crypto trading keys securely, you can also have an extra password to access them but, you can not completely trust that no fraudulent activity would happen with them.
On the other hand, if you think about desktop wallets, they don’t even need any online connectivity to store the keys. But, as they are offline you can be out of fear of any online scams to happen on them.
Conclusion
Both software and hardware wallets have their own features and different users prefer different wallets for their convenience. If you want to use any crypto wallet you can research the facilities the wallet will give you with keeping the security measures in mind and then you can use it.
China has also come up with its cryptocurrency digital Yuan. So, if you have a crypto wallet, and you wish to explore the Chinese cryptocurrency, then you can log on, where you will get easy and simple access to digital Yuan.