Storing your digital wealth before understanding how the digital currency storage work can be risky. Use of the currency begins with identifying a storage system that you are comfortable with. You can choose to use online exchange or cold storage depending on the amount of currency you need to store and the security level. Without a store, you can own or transact with any digital currency.
Digital currency stores are referred to as wallet and you can choose between the two popular options; online exchange and cold storage. These two enable you store your digital wealth safely and securely; however, you need to be particular on the feature flexibility knowing security begins with you.
A digital wealth storage facility is a lot more than storing your currency; it also holds critical data. When performing a transaction, you are using a unique address to send to another sender with a unique address. This is more like email addresses but with a bit of a twist. Your wallet or storage has your public key and private key as well.
Hold Tight to Your Wallet Keys!
These two sets of keys serve different purposes. Your storage or wallet has an address that you are identified with in the network. The public key is the address you give others so that they can send you digital currency and it is safe to share. Funds are stored in your wallet and you are the only one who can shift them to a different wallet.
The private key remains private as the title indicates, you should never share it with anyone. You use your private key to spend or send your currency from your wallet. When you go to your wallet, the system prompts you to enter the private key to commence transactions; it acts like a password to your wealth.
You can opt to download a wallet to your smartphone or Pc or just identify an online host or exchange. Many users prefer using wallet hosted by service providers. Exchanges offer free storage but will charge you a small maintenance fee.
The Vulnerability of Online Crypto Exchanges
Online storage is the most popular and easy to access but the most vulnerable. Many digital currency exchanges offer various
storage solutions to a wide variety of users. These are sites or applications that manage you private data. You can either download or signup with their sites to get started. They are easy to set up and operate.
Online exchanges require that you submit a withdrawal request by logging into their dashboard and sometimes the process can be tedious. CoinBase and Blockchain.info are some of the online exchanges you can try for your storage solutions.
Exchanges have a myriad of problems and you need to be extra careful who your host is. Hackers target accounts that are hosted by exchanges; mostly, they target wallets that have huge balances. On the other hand, hackers and cyber-crime activities may target your account.
Watch Out for Those Email Links/Attachments
Phishing is another problem with storing your digital wealth online. You can easily be tracked online through your wallet transactions. If you use your wallet regularly or you have several accounts that you move your funds to and fro, you could be the next victim; avoid exposing your online privacy.
The other way you can store your wealth is though desktop storage. You need to identify the right storage program and download it to your computer or smartphone. This comes with some risks and you need to be careful how you store your private key. If others have access to your PC, do not enable the password auto-fill function.
Desktop storage requires backup and the best way you can do this is through your USB stick or external hard drive. Each file
needs to be password protected and safely stored. However, desktop storage has its own risks. You can get hacked once you connect to the internet or if you do not use malware and virus protection, you might lose your data if they attack your computer or smartphone. Mobile storage works well but just like desktop, it is not one of the best when it comes to storing your digital wealth. Whether you are using Android or iOS, you are prone to virus and Trojan attacks.
Last on cold storage is the hardware digital wealth storage and is extremely secure. Buying the hardware s may cost you up to $100 but it is worth the investment. However, it might not make sense to have storage worth more than what you keep in it; it gives you peace of mind.
Hardware storage is small device but very convenient. It helps you store your private key safely. The cold storage is the best for you and gives you absolute control over your digital wealth. You are the custodian of the hardware and you only use it when you need to connect to your personal computer.
For the best peace of mind and value for your money, cold storage is the best. It offers ultimate security to your wealth compared to your online exchange. You do not have to expose your fund to hackers and cyber-crime risks when you can keep your storage in your pockets.