Cryptocurrency storage is an important step in keeping your personal digital currency safe. Whether it’s Ethereum, Bitcoin, or any other crypto currency, having a good storage wallet is essential to keep your funds safe. Many trading platforms that also offer you to store passwords are not trustworthy. Thus, here are the different wallets where you can store your cryptocurrency.
Offline wallet
An offline wallet or cold wallet is a method of storing cryptocurrencies offline. Since it is not remotely accessible, it is the most secure category of wallets. Because of their security, cold wallets are favored by the more cautious and those who hold relatively large amounts of cryptocurrencies.
There are two types of offline wallets: hardware wallets and paper wallets. Both options allow you to store cryptocurrencies without connecting to the Internet.
Full wallet
Like Bitcoin Core, there are full wallets or full wallets that work completely independent of the network. The software that will act as the wallet on your computer will download the entire blockchain of the associated cryptocurrency and store it on your computer’s hard drive.
By installing a complete wallet on your computer, it becomes a complete node and helps secure the network. The owner of this computer would therefore be a minor and would be compensated for their part in securing the network. However, this solution is not for everyone. Beginners, or those who don’t want to spend a lot of time managing their crypto-currencies, can find alternatives thanks to wallets that are easier to use, such as the one offered by the ZenGo application.
Desktop wallet or mobile wallet
Desktop wallets allow you to store your private keys on a device that you own. The wallet can then interact with the corresponding blockchain. The system does not require you to provide your personal information and most of the time, you have full control over the fees associated with the transfer. Here, you are the owner of your cryptocurrency. The principle of the mobile wallet is the same, you install an application on your cell phone, and the private key is placed on it.
Therefore, this type of wallet provides non-depository storage of cryptocurrencies. There are still a few drawbacks to these wallets. Firstly, the medium on which the private keys are stored remains vulnerable to computer attacks. Thus, if your computer or phone is hacked, your private key could be stolen by the hacker.
Hot wallet
Unlike cold wallets, there are also hot wallets. They are permanently connected to the Internet, which could allow malicious people to hack them.
That said, the hot wallet solutions available today are quite reliable and the risk of being hacked is relatively low (if you are vigilant and don’t plan to connect your wallet to sites).
However, the security will never be as optimal as that offered by cold wallets. These solutions are more practical for those who do a lot of trading or want to interact with decentralized financial protocols on blockchains like Ethereum, Avalanche, Solana, Matic, etc.
Hi techies! My name is Alice, a passionate geek who loves everything about high tech. My love for gadgets and new technologies goes back to my youth, and since then, I’ve been following the evolution of the industry closely. I love diving into the technical details and specifications of devices to understand how they work and what they are used for. In this blog, I will share my knowledge and opinions on the latest trends in high tech.