If you own cryptocurrency, you need a place to store it securely. Just like tangible currency, cryptocurrency should have a storage place that is safe, but also accessible. A popular storage solution for cryptocurrency today is a cryptocurrency wallet. Cryptocurrency wallets are digital tools that allow you to keep your money safe, while still using it to invest and trade. Read on to learn more about how cryptocurrency wallets work and how you can benefit from using one.
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How Cryptocurrency Wallets Work
Essentially, investors use cryptocurrency wallets for storing, sending, and receiving cryptocurrency. With cryptocurrency wallets, the currency isn’t actually stored inside. Instead, the wallet serves as a sort of lockbox that displays how much currency you have and a record of all of your transactions.
If you want to access the cryptocurrency in your wallet to send some away, or if you want to receive cryptocurrency that someone sent to you, you need to have the key to access the wallet and cryptocurrency. The key matches these public address associated with your account (so that people know where to send currency). When you have a cryptocurrency wallet, it is essential to keep track of the key, which comes in the form of a passcode.
Types of Cryptocurrency Wallets
Not all cryptocurrency wallets are the same. In fact, there are several different types you can rely on for securing your coins. Here are some of the most popular:
- Hardware wallet: this wallet is a physical, tangible device that lets you keep cryptocurrency stored offline. To use it, you must insert it into a computer or device that has access to the web.
- Software wallet: These wallets can be stored on your desktop, online, or on a mobile device. They’re not physically tangible, but you can access them either via one device or via any device that can access the Internet.
- Paper wallets: Some cryptocurrency wallets allow you to print paper copies of keys. You can avoid storing any digital info about your wallet by using a paper wallet.
How to Transfer Coins Into and Out of a Cryptocurrency Wallet
As a cryptocurrency investor, you probably want to transfer coins into and out of your wallet regularly. Transferring coins into your wallet means your balance is growing. Transferring them out means you’re making payments or investing in something else.
In order to transfer coins out of a wallet, log in to your wallet, visit the send and receive feature, then click send. Enter the public address of where the coins are going and the amount you’re planning to send.
To receive coins, share your wallet’s public address with the person sending you coins. Then, wait to receive them in your wallet (the action’s on them in this case).
Benefits of Using Cryptocurrency Wallets
There are benefits of using cryptocurrency wallets to help manage your coins. First, they are secure, and they limit people’s ability to access or take your currency. Also, they make using your cryptocurrency easy, whether you’re sending or receiving it. Finally, they’re a tool that simplifies the process of using cryptocurrency, so they make the process take less time and energy, and they don’t require any tech expert knowledge.
Being a cryptocurrency investor means hanging on to currency that you can’t tangibly access. To keep it safe and secure, consider using a cryptocurrency wallet.