When you take your first step in the world of crypto trading, it’s usually by purchasing a cryptocurrency. Whether you opted for a well-known token like Bitcoin or something that falls within your reach, like XRP, it’s crucial that you’re storing it the right way. But what is the proper way to store your cryptocurrencies? This requires you to choose a suitable crypto wallet. Here’s a guide that tells you how to do just that.
Is It Secure?
Just like when you’re choosing a crypto exchange or cryptocurrency to invest in, you need to consider how secure a wallet is. After all, it’s crucial that you have a first line of defense in the event that your device ends up in the wrong hands. Your device should require you to enter a PIN code each time you want to use it. So if you lose your device, you don’t have to worry about someone else stealing your tokens.
Does It Have a Reputation?
The reputation of the company making the crypto wallet is an important consideration. That’s because it’s possible for it to have built-in security flaws that put your cryptocurrency tokens at risk. To know if it’s a reliable wallet to use, look it up on different online forums to see what other investors and crypto holders are saying about it.
Does It Provide Access To Private Keys?
To complete a cryptocurrency transaction, you need a public and private key. Your public key is what makes your wallet address distinctly identifiable. It’s how other members of the network know it’s you and send you cryptocurrency.
But if you want to access the cryptocurrency in your account, you need to use a private key. This is a passcode that only you know, and it helps the blockchain identify when you’re trying to access the cryptocurrency in your account.
Why It Should Give You Access To Private Keys
So, if the wallet you’re considering doesn’t give you access to the private keys, you don’t have control over your cryptocurrencies. Whoever has access to the private key of an address has complete control over the digital assets in the account.
By using a wallet that doesn’t give you your private keys, you only have a claim to your cryptocurrency tokens. In fact, someone else has custody and control of your assets. So, if it ever happens that the custodian goes bankrupt, there’s a chance that you may never be able to access your cryptocurrency.
Not to mention, you’ll need to ask the custodian for permission each time you want to access the cryptocurrencies in your wallet. To make matters worse, they may delay your requests or even charge late fees that prevent you from using your tokens.
When you have access to the private keys, you’ll be dealing with the public blockchain directly. This takes the middleman out of the equation and allows smoother, faster transactions.
What Are Its Backup Features?
Advanced wallets with innovative features allow you to back up your private keys. Although it’s important that you have access to the private keys, it’s true that managing them can be difficult. That’s because some people want to own more than a single wallet or the best way to store a private key is to write it down on paper and keep it safe.
When you use a wallet with private key management features, the process of storing your private keys becomes less of a hassle.
Does It Offer Fee Customization? High-performing crypto wallets make it simple to customize the fees you pay to a public blockchain miner or validator. The wallet may have preset such as slow, medium, and fast. So, if you choose fast, you’ll be able to pay a higher fee, but your transaction is completed much more quickly. Similarly, if you choose slow, you’ll pay low fees but the transaction will take longer to complete.
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