Where to store cryptocurrency?

Cryptocurrency is a digital currency that is not controlled by any central authorities (banks, the state, etc.). There are over 17,543 cryptocurrencies in the world. The most interesting thing is that each person can create their own digital currency with only a laptop needed. It also should be mentioned that cryptocurrency cannot be withdrawn into cash, the only thing that can be done with it is the exchange of crypto for dollars, euros, etc. 

A common question usually emerges for people who start working with cryptocurrency: where should I store my cryptocurrency safely? To begin with, let's figure out what cryptocurrency is in general.

The very first cryptocurrency ever existed is Bitcoin. It was created in 2009 by Satoshi Nikamoto, it is still unknown whether the creator was one person or a group of people. Back then nobody could believe that bitcoin would become so popular in the future. In 2010, he could not pass the value of $1, but already in 2022 its price jumped to $42,000. Of course, BTS is constantly falling and taking off, so the price is always changing.

Let's have a look at the ways of storing the existing cryptocurrencies:

  • custodial (hot) wallets - with custodial wallet you can transfer your assets to third parties for storage. It is somehow similar to the banking system. Many exchanges have custodial wallets (Binance, Poloniex, Bittrex, Coinbase, etc.). If you forget your password, you can always recover it by verifying your identity.
  • non-custodial (cold) wallets - using such wallets you are in full control of your funds. The private key, or the seed phrase is completely under your control. But if you lose or forget your phrase, you will never be able to return your funds.

There are also other wallets that exist in the crypto industry:

  • Online crypto wallets - you don't need to download anything, you just need an internet connection to use it. All wallet functionality is available on the site (i.e. transfer, exchange, etc.). Data can be stored both on the device and on the company's servers, but this is not secure. The most popular online crypto wallets are Blockchain Wallet and MyEtherWallet.
  • Desktop crypto wallets - in order to start working with such a wallet, you need to install a special application on your PC. These wallets are safe, as most developers keep users’ data not on their servers, but on client computers. The most popular desktop crypto wallets are Electrum and Jaxx.
  • Mobile crypto wallets - these wallets have to be installed on your smartphone, they kind of resemble the desktop version. They are quite convenient, since we always have mobile phones with us and can transfer cryptocurrency at any moment. Users’ data is stored locally. Some popular mobile crypto wallets are trustwallet, metamask, etc.

We suggest you not keep your seed phrase or key on your screenshots, written notes on your phone or laptop. The best way to safely store it is to write down the key on several pieces of paper and hide it somewhere in your house you won't forget.

The way to choose where to store your assets is completely up to you. We will provide you with more educational articles. You can ask any questions in our Telegram Chat: https://t.me/AquarisCommunity


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