Types Of Crypto Wallets

1. TYPES OF CRYPTO WALLETS BY: BLOCKTECH BREW 1

2. Hosted Wallets These are the most popular and easy-to-set-up wallets. Once you buy crypto using an app, it is automatically held in a hosted wallet. It is called ‘hosted’ because a third party keeps your cryptocurrency for you, just like a bank keeps your cash in a savings account. With a hosted wallet, you don’t have to worry about “losing your keys” or “losing your USB wallet”. In this case, even if you forget your password, you won’t lose your digital currency. However, you can’t access everything cryptocurrency has to offer when you use a hosted wallet. This might change as hosted wallets start supporting more features. 2

3. Before you set up a crypto wallet, choose a trusted platform. The three main qualities of such a platform are ease of use, security, and compliance with government & financial regulations. Next, create an account. Fill in your personal details and choose a strong password. We highly recommend that you use two-step verification for an added layer of security. Either buy or transfer cryptocurrency. Most crypto exchanges and platforms allow you to buy crypto using a credit card or a bank account. If you already own crypto, feel free to transfer it to your new hosted wallet for safe keeping. How to set up a hosted wallet? 3

4. Hardware Wallet It is a physical device – about the size of a thumb drive – that stores the private keys to your cryptocurrency offline. If complexity (setting them up takes time) and comparatively high costs (over $100) seem like barriers for you to set up a crypto wallet, then you should reconsider using a hardware wallet. But it has a huge benefit too — it’s the most secure of all wallet options. So, using hardware wallets keeps your cryptocurrency secure even if your computer is hacked. The extra security is possible because your private keys are held in an offline device that isn’t your laptop, mobile phone, or other computer. As such, hardware wallets are less prone to malware attacks from hackers. 4

5. Buy the hardware. The two popular brands are Trezor and Ledger. Install the software that’s needed to set up a crypto wallet. Download the software from the company’s official website and follow the given instructions to create your wallet. How to set up a hardware wallet? Write down the recovery passphrase for your private keys. Connect the hardware device to your computer. A hardware wallet doesn’t typically allow you to buy crypto using standard currencies (like Euros or US dollars). So, you’ll need to transfer the cryptocurrency to your wallet. 5

6. Mobile Wallet A mobile wallet is much easier to set up. The first step is to choose a mobile crypto wallet app from your device’s associated app store. Two examples are Edge and BRD. The thing about most mobile wallets is that you can instantly accept cryptocurrency payments. But ensure that during the setup process, you keep a backup of your private keys on physical paper. Such a backup generally comes in the form of a 12 to 24 letter passphrase, also called your recovery phrase. Though not all crypto wallets require this step, it’s a best practice to follow. Otherwise, if you lose your phone or your mobile device simply stops working properly, you may permanently lose access to your funds. Remember, in the cryptocurrency industry, no third party can come to your rescue once you’ve lost your password. 6

7. Launch the mobile wallet app on your phone. For Apple and Samsung, click on the “+” symbol or add button to add a new card and then select “Continue”. How to set up a mobile wallet on Apple Pay, Samsung Pay, and Google Pay? For android users, the app will show cards that are already linked to the account. Select one of the linked cards or select add another card. The app will either let you take a picture of the card or enter the card digits manually. Make sure to “Review the Terms and Conditions” and tap on “Agree”. Enjoy the convenience of paying with the wave of your phone. 7

8. Desktop Wallet As compared to mobile wallets, desktop wallets typically include a more extensive portfolio. Using these, you can track graphs and charts to know the value of your assets in various ways. Some examples of desktop wallets are the Jaxx Liberty Wallet, Exodus Wallet, and Atomic Wallet. You can also set up a crypto wallet on your desktop. Setting up a desktop wallet is similar to setting up a mobile wallet. All you have to do is select your cryptocurrency wallet software. Then, you only need to run the software to begin the setup process. Just as in the mobile wallet setup process, desktop wallet software could ask you to create a backup of the passphrase associated with your private keys. 8

9. After you install the Desktop Wallet, open it and create a password that contains at least six characters. Note down the password somewhere safe as you’ll need it to sign into the Desktop Wallet again. Go to “Settings” in the Desktop Wallet and select “Node settings”. How to set up a desktop wallet? By default, the Virtual Hive node is inserted. However, you can change this to any other node of your preference. You can even choose the node provided by your third-party provider. Then, enter the Address & Port of the node you’re running. The address is the node’s network address. Then select “Set Connection”. You will see a message saying “Successfully Connected” if the connection is working fine. Once you install the Desktop Wallet, ensure that you set up an identity & an initial account. 9

10. Custodial vs. Non-Custodial Wallets Custodial wallets differ from non-custodial wallets in that they hold your private keys for you. So basically, a third-party holds your cryptocurrency for you. It is crucial that you choose trustworthy, regulated providers like Coinbase. Further, use two-factor authentication whenever it is offered. Almost every custodial wallet offers two-factor authentication. The Electrum wallet even offers this feature in a quasi- decentralized way. 10

11. Setting up one of these doesn’t need right away; that comes later when you want to put some crypto into it. Choose a wallet app like Mycelium, Coinbase Wallet, or Metamask. How to set up a self- custody wallet? Make an account and record your recovery phrase. Certain wallet apps might allow you to add an extra layer of security, like creating a passcode or facial recognition. Add some cryptocurrency into the wallet. After this, your ID will be verified. Now start sending, receiving, or trading crypto! 11

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