Cryptocurrency | Types of Cryptocurrency wallets that you should know about

Crypto wallet is generally a media or program for storing cryptocurrency, the crypto wallet has various types depending on the user's needs. Crypto Wallet is generally divided into three types namely: Software, Hardware, and Pepper Wallet and is divided into two types: Hot and Cold Wallet.

In general, the crypto Wallet service is software, which is based on user comfort. However, Hardware wallet provides an alternative with strong security, while Pepper wallet or printable wallet also offers strong security, but the paper wallet is rarely used because it is outdated and difficult to depend on.

The crypto wallet works by providing the tools needed to interact with the blockchain, in other words, the wallet can create the information needed to send and receive digital currencies through blockchain transactions. In essence, crypto Wallet does not store cryptos but provides equipment to interact with the blockchain.

Crypto Wallet also has a Public address as an identification tool and Private Key as security and proof of ownership. A public address is essentially a specific "location" where crypto will be sent on the blockchain network, while the Private key is a personal identification and should not be distributed to anyone.

It is important to know, if the private key falls into the hands of people, the coins we have will most likely disappear "stolen".

Hot wallet and Cold Wallet
The hot wallet is a crypto wallet of any type that is connected to the internet, examples of hot wallets are coinbase and other crypto exchanges. On average crypto exchange only holds a small portion of their assets in a hot wallet. The advantage of the hot wallet is that it is easy to manage and access and is certainly very convenient for users.

The cold wallet is a crypto wallet type of paper and hardware wallet that is not connected to the internet, users of this wallet also have full control over the coin and private key wallet. Because they are not connected to the internet, most crypto exchanges use this type of wallet to secure their assets. This wallet is also suitable for long-term crypto investors.

Here are the types of crypto wallet that you can use to store your crypto:

Software Wallet
Is the type of wallet most widely used, this wallet has various types of features and its uniqueness depending on the bomber. Almost all of these types of Wallet are connected to the internet (Hot wallet) and almost all of these types give you full control over your assets.
Wallet Software is divided into two, the desktop version and the mobile version. the desktop version must be loaded first, this version gives the full control over your private key and funds, and you can modify your wallet "usually for crypto forks" (for the open-source version).

Keep in mind that in the wallet software there is a file "wallet.dat". If you lose this file or forget your password, you will lose access to your funds.

On the other hand, the mobile version also gives you complete control over your private key and funds (not all of them), this version also has a barcode first to facilitate and avoid mistakes made by the user when sending crypto. The mobile version generally has the same security, namely: authenticator, PIN, SMS, telephone, and fingerprints and can back up secure word, private key, and barcode backup.

Web Wallet
Wallet type can only be opened through a web browser and is the wallet most often used and the easiest and most convenient way to use. The web wallet is mostly owned by the crypto exchange or independent wallet connected to the crypto exchange.

This wallet is a private key held by the company, but this is very risky because you entrust your funds to others. However, currently web wallet developers protect their users by using multi-factor tools, seed keys, and so on, some developers provide flexibility to their users to manage private keys in full or in full (multi-factor).

To use the web wallet, it's best to do the analysis first to see the security used, the wallet work system, and the history of the company you will be using.

Wallet hardware
A hardware ware wallet is a physical electronic device that uses random number generation (RNG) to open public and private addresses. These keys are stored on the device itself and are not connected to the internet. This storage is the most resilient [cannot be hacked]

Even so, this device is not user-friendly and difficult to access. Developers of these devices usually create applications for ease of use and can also be connected to several supporting exchanges such as SapeShift and BinanceDEX.

This type of wallet is highly recommended for long-term investors and crypto exchanges.

Pepper Wallet
This type of wallet is a paper that contains a public address and a private key and QR Code that can be printed. This wallet is effective if you want to make direct face-to-face transactions. However, this Wallet is also not recommended because it is very dangerous and not recommended, because the wallet can only contain the entire balance in part in one transaction.
For example, if you have 1 ETH then you only send 1 ETH and cannot be less. However, you can still send part of your balance with certain tricks, I will give the trick in next post.

Crypto wallet is an important instrument in cryptocurrency, each crypto wallet has advantages and disadvantages of each, so it is very important to know how they work before you use it. Besides, loss of access to the crypto wallet can be fatal, so it is very important to archive and backup data regularly.

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Cryptocurrency | Types of Cryptocurrency wallets that you should know about Cryptocurrency | Types of Cryptocurrency wallets that you should know about Reviewed by sheffter on September 29, 2019 Rating: 5

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