Several years ago, many people were assuming that cryptocurrencies were a pyramid scheme and a passing fad. After all, how could digital currency work properly without having a government to back it? But when a person really examines worldwide currencies, we realize that the money we have in our billfolds really has nothing backing it either.
Digital currency, better known as cryptocurrency, has gained a high level of popularity. People who purchased Bitcoin, Ethereum or other forms of digital currency early have gained monstrous profits.
Is it too late?
That would be like saying no to buying into Apple stock because it has been out too long. Every day, people buy and sell Apple stock for good profits. It can be the same with cryptocurrency.
With Bitcoin reaching massive heights, many people are now considering investing in cryptocurrency we want to provide you with information to help you have a safe and profitable crypto-investing experience whether you decide to trade cryptocurrencies with our robot or buy and hold in a wallet.
Here are the best cryptocurrency exchanges and wallets…
What is an exchange?
Simply put, an exchange is the medium where a person can buy and sell cryptocurrencies. If a person wants to invest in crypto, they would have to register with with a cryptocurrency exchange.
There are many exchanges in operation, but not all are created equal. There are certain criteria you should examine before choosing the exchange that is right for you.
Scroll down and we will provide you with the unbiased info you need before investing in cryptocurrency.
Where are my coins stored?
When you purchase a cryptocurrency from an exchange, they are delivered to a wallet in your account at the exchange.
The wallet is a system that “connects” to the digital blockchain and keeps track of your crypto account.
Naturally, this is done digitally with the use of passwords and key-codes. So the possibility of getting “hacked” is real. But just like a regular wallet, a person can take protective measures to ensure it is safe from crooks and thieves.
When you purchase crypto from an exchange, it is put in a designated wallet that is owned by the exchange but you have the key to do what you will with your crypto. You should already have a personal wallet that you can transfer your purchase to.
I will explain more about crypto wallets as you scroll down.
Choosing an exchange and what to look for
As stated earlier, not all exchanges are the same. There are certain things you should look for in an exchange. We have narrowed this down to 3 areas:
- Your location and the exchange location
- Payment method and fees
- And the cryptocurrency you are interested in buying or selling
Locations – Depending on your country of residence and as regulations come into play, you will want to use an exchange that is “friendly” to your location.
Payment methods and fees – You want to know exactly how you plan on paying for the cryptocurrency you are investing in. You want to research all the fees which are quite different between the many exchanges. You will want to know the percentages for buying and selling, exchanging and for withdrawing.
The cryptocurrency of choice – With many various cryptocurrencies in use and more being developed, you will want to see if the exchange offers trading in the cryptocurrency you want to invest in.
What is a wallet?
A wallet is your gateway to trading in cryptocurrency. Without wallets, no transactions could be done.
Now your wallet does not actually contain your cryptocurrency. Keep in mind that all crypto transactions are done on the blockchain. Your wallet is simply a record of all your transactions and your cryptocurrency balance.
To achieve this, wallets are managed with public and private keys. It is up to you to keep, store and secure your private key. If you lose it, you lose all cryptocurrency you have garnered. Like exchanges, not all wallets are created equal either.
But no matter the wallet you use, there are certain safety measures you should take…
- Use strong passwords and usernames
- Never use public Wi-Fi to access your online wallet
- Carry a good antivirus and malware software on your device
- Make sure online wallets have a secure (https) address
- Have a secure firewall installed
- Keep your wallet software updated
- And only use trusted and verified wallets
The 5 different types of crypto wallets
We explained how wallets work; they essentially store 2 keys, 1 public and 1 private which are used to complete transactions.
Various companies have developed crypto wallets. These can vary in ease of use and the level of security. Crypto wallets come in one of 5 types. They are:
Desktop – Probably the most used crypto wallet, they are downloaded on your computer and can only be used from that particular device. You must keep your computer secure and you must store the string of words for your wallet in case your computer crashes.
Online – These are the types of wallets exchanges and many businesses use. They are run through the cloud. They are the easiest to set up and use but can also be the least secure.
In some cases, online wallets will charge for transactions.
Mobile – These are similar to the desktop except they run on an app in your mobile device. They also carry a high level of security, but it is up to you to protect your smartphone or tablet. Losing it can allow the finder to have access to your crypto funds.
Hardware – This type of wallet is similar to the desktop, but you gain another security level in that you store the private key on outer storage like a USB stick. Each time you make a transaction, you would have to use the hardware to do so. But DO NOT lose the USB or you will lose your cryptocurrency.
Paper – It IS the most secure wallet because it is what it says… printed paper. The paper will print your public and private keys and that will be your wallet. But, you will still need to have one of the other wallets to complete any transactions with your paper wallet. This makes the paper wallet the most complex wallet type.
Sending and receiving coins with your wallet
This is the area that often scares people away from getting involved with trading in cryptocurrency. But there is no need to fear, it is much easier than many people assume.
Sending – The sending process means the recipient will need to provide you with their public wallet key. It can be provided in one of these ways:
- A long string of letters and numbers
- A QR scanning code for mobile wallets
- Or a web link that when clicked on, opens your wallet
When the address is entered in the wallet, you will then enter the amount of crypto to be sent and press send. Once a miner has entered the log into the blockchain, the recipient will be notified of the transaction. It can take a few seconds up to 10, or even more minutes.
Receiving – Sending really isn’t difficult and receiving is even easier. Depending on the wallet used, you will get a fixed public address, a variable address or a combination of each. You provide the sender with a public key to your wallet and the amount of crypto you are requesting. The sender uses this info to send you money using the previous steps.
As you can see, investing in cryptocurrency is not that difficult. Just do your research to find the exchange and the wallet that best suits you and your goals.