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Where is it better to keep cryptocurrency?

Vladlena Martus 2022-05-03

Where is it better to keep cryptocurrency?

Cryptocurrency could be pretty complicated for beginners, especially those that only start their way in this market. It is hard to succeed in trading or investing without quality guidance and research. 

We are sure that you thought about where it is better to store your cryptocurrency no more than once. Wisebitcoin wants to help novice traders and investors answer perhaps, the most critical questions:

  • Where is the best and safest place to store cryptocurrency? 
  • What methods and options are there to keep cryptocurrencies? 
  • Why should we, in general, pay attention to these methods? 

Let's figure it out together in today's blog!

Wisebitcoin is sure that each of our traders knows the risky elements of cryptocurrency investing. We hope you remember that trading with these digital assets can become successful and unfortunate. Be attentive and try to have as much information as possible if you decide to obtain these instruments.

Content:

  1. Cryptocurrency storage: what are the options?

  2. Cryptocurrency wallet

  3. Cryptocurrency exchange

  4. Other methods to consider

  5. What option to choose when deciding to store cryptocurrency?

  6. Is Wisebitcoin a reliable platform to store crypto?

Cryptocurrency storage: what are the options?

Cryptocurrency is a fairly attractive investment tool. Many market players can secure a steady income by choosing the right coins and making the right, well-thought-out deals. We have already told you which cryptocurrencies at the beginning of 2022 are promising for investment and trading. You can read this top-5 list of coins here.

However, cryptocurrency is also a somewhat risky tool that can play a trick on your capital. You also need to think about the best way to protect your assets, what kind of storage place would be relatively safe in your particular case, and other essential details. 

Most traders and investors have the two central options: the crypto wallets and the cryptocurrency exchange platforms. These tools make cryptocurrency deals more valuable and secure. The interesting thing to note is that you can use them simultaneously because they fill two different ecosystem niches, so that they can be helpful for other purposes and tasks. It remains only to choose your tool or try to use them together. 

  • A Crypto wallet is a way in which you can keep your investments securely but without constant usage;

  • Crypto exchange platforms allow you to buy, sell, exchange, and store your coins, using them actively. 

There are also payment systems and third-party services. We will review these two methods later to understand the whole picture of crypto storage.

Cryptocurrency wallet

It is a tool that is implemented with the help of a program and allows traders and investors to keep their cryptocurrency investments in a particular store. 

There are two kinds of crypto wallets: “hot” ones that stay online and “cold” ones that stay offline. Many traders prefer cold wallets because they are more secure and can protect themselves from hacking and fraud. However, such protection makes wallet usage inconvenient, so the most optimal way is to have a non-custodial wallet (that is not connected to the exchange or any other platforms) from the “hot” category that has a constant connection to the network.

When you store your assets in a wallet, you need to have both private and public keys to have access and complete control of the wallet. They are randomized just in time when the wallet is created. These keys should always be with you because you will not have access to your assets without them. Of course, it would be better to have them not online but in written form on paper. 

To sum up a bit, we can stop at the main advantages of the wallets: 

  • Easy access; 
  • Long term storage;
  • High level of security.

Cryptocurrency exchange

It is a service implemented on a website, where you can sell, buy, exchange cryptocurrency, and convert it into fiat and visa-versa. The rates on the digital market exchange fluctuate just the way it fluctuates on the stock exchange. 

There are centralized and decentralized exchanges on the market. Thus, the first ones are easy to interact with cryptocurrencies, to deposit and withdraw the fiat currency. However, they are connected with the central authority that could be hacked. The second ones are unsuitable for storage, but they are more secure because they have no leading authority to hack. 

Crypto exchange platforms have their wallets, time after time, and are primarily web-hosted inside the website. To access the wallet on the cryptocurrency exchange, you need to sign in and create your account. Exchanges keep your private key, so if you lose the password to the account, it could be restored, but if you lose access to the account in general, you will not have access to crypto.

To sum up a bit, we can stop at the main advantages of the exchange platforms: 

  • Insure against hacks and loss of private keys;
  • You can restore your password;
  • Better and more accessible user interface;
  • High level of security;
  • Customer service.

Other methods to consider

In addition, for your cryptocurrency storage, you have two more options to use, but they are not so popular and widespread: 

  • Payment systems that allow storing cryptocurrency on the balance of electronic payment systems. They are pretty comfortable but require high fees for transactions and can be hacked due to centralization;
  • Third-party services allow you to keep your cryptocurrency with the help of Western brokers and on incredibly progressive bank accounts. This option is more convenient to trade cryptocurrency, buy, sell or exchange it.

What option to choose when deciding to store cryptocurrency?

This decision should be made personally and specifically for the particular situation. Both crypto wallets and exchange platforms are platforms that give you the possibility to store and access digital currency. However, they are different in the details. 

The most important thing to understand before choosing the methods is understanding and evaluating the risks you can get during your crypto activity. 

Crypto wallets are pretty secure. However, the whole responsibility is laid on you because it is way more complicated than opening an account on a crypto exchange platform. You should manage, backup, and secure your account by yourself. It could be a bit tricky for beginners because, if something happens, without the key for the wallet, you will not have access to your account, which means a total loss of the money. 

Keeping the cryptocurrency on the exchange platforms could be the easiest way for beginners to store the assets: there is no need to remember or write a key to prevent the loss of the crypto assets. Exchange can offer you the possibility of constant trading and investments. It is a convenient experience you can get during your start on the cryptocurrency market. And, of course, you will not have to worry about securing, back up, and managing your assets – the exchange platform will do that for you. In case of hacks or issues from the platform side, it will return the whole affected amount of coins. 

Is Wisebitcoin a reliable platform to store crypto?

Yes. Moreover, we have a super safe environment where you can profit from transactions on the market and store your cryptocurrency safely. We provide our users with two-factor authentication, additional security services, and a quick response support service if you note a suspicious account activity. 

We aim to provide a user-friendly interface, quality services, and opportunities for trading, investing, making transactions, withdrawing, and depositing cryptocurrencies.

Wisebitcoin is an exchange platform that offers deep liquidity, 100X leverage, and cloud services that unify more than 200 other cryptocurrency exchanges worldwide. It has both “hot” and “cold” wallets inside the platform. Wisebitcoin is also connected to the cloud of 15 million users and more than 280 merchants. That helps us be one of the most promising and attractive platforms to work with. 

 

Follow us for more interesting topics to research next week! We will be happy to share curious facts, news, and subjects about the crypto market and its surroundings. See you!