Like traditional currency notes, you can't fold up your Bitcoins, Ethereum, Doge coin, or any other criptocurrency holdings and put them into your wallet. They are available in a variety of formats, from hardware wallets to apps that you can run on phones or computers. These wallets keep your private keys - the passwords that give you access to the criptocurrency - safe and accessible.
What are the different types of wallets for cryptocurrencies?
There are three main types of criptocurrency wallets you can choose from - paper wallets, hardware or physical wallets, software or online wallets.
Paper wallets: Here is a place where you can write down your private key on a tangible medium, such as paper, and store it in a secure location. This isn't safe, especially if you are the sort to leave paper pieces scattered all over the house.
Hardware wallets: Also known as physical wallets, these keys are stored in a secure location and are only connected to a computer when you wish to use your cryptocurrencies. Like paper wallets, hardware wallets have the risk of being lost or destroyed.
Private keys can be stored in an app or other software, or in an online wallet, in these wallets. You can use cryptocurrencies in the same way that you would do transactions in an online bank account, as well as send, receive and use cryptocurrencies.
A software wallet is an example of hot storage, while the other two types of wallets — paper and hardware — are also known as cold storage. Hot storage wallets are those that are connected to the Internet and can be used to pay for items immediately as well as acquire additional cryptocurrencies in real-time. The private keys are what they do when it comes to cold storage wallets.
If you lose your private keys, you will lose access to all of your cryptocurrencies. It is important to keep your hardware wallet secure and use a trusted service if you are using a software wallet.
The easiest way to get started in your journey is to use an online wallet provided by a large exchange that offers a blend of security and accessibility. Your protection against hackers is limited because of the security of your wallet provider, because of the fact that your personal information is stored online. When you use an online wallet, you should look for measures like two-factor authentication.
You should make sure you know where your private keys are and that you've kept your wallet password safe. You do not want to lose your cryptocurrencies because you misplaced your keys.