How To Store Cryptocurrencies? | Beginner's Guide
Move cryptocurrency from your hardware wallet to a “hot” exchange wallet when trading, and move it back when it’s not in use.
If you are reading this post, probably you are going to buy your first cryptocurrencies. But first, you must ask yourself two important questions:
- What level of security satisfies you and what amount of funds are you going to keep?
- How do you want to connect with your wallet? From a computer / tablet / phone or via a web browser?
For long-term storage of significant funds, we are recommending to use offline wallet “Paper Wallet”, or hardware wallet eg. Ledger, Trezor. The disadvantage is their low mobility.
The security of our wallet depends mostly on security of the computers we use.
Wallets can be divided into 5 categories:
- Browser wallets - This is a wallet provided by a website providing such services. To use it, all you need is a computer / tablet / phone with a browser and access to the Internet. We entrust our funds to third parties, which also involves the risk of losing funds.
- Offline wallets -(or Paper Wallet) aka safe to store your money. This type of wallet is characterized by low mobility.
- Hardware wallets - Often has the shape of a thicker pendrive. Very safe. They allow you to keep many cryptocurrencies at once. We can use it on any device equipped with a USB input, or with a suitable adapter. We will not pay with it in the store.
- Wallets in the form of a desktop application - (for a personal computer) this type of wallet can be used only on the computer, on which it is installed.
- Full node - storing the whole chain of blocks. Long synchronization time and high resource intensive, disqualify it as a wallet for beginners.
- Light - the block chain is stored on servers. Fast synchronization time, low resource intensive.
- Mobile wallets - As the name suggests, these wallets are designed for mobile devices. They enable quick payment anywhere by scanning the QR code.