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Where to store crypto and how to create a bitcoin wallet in 2024
Choosing a reliable crypto wallet is the next crucial step after purchasing bitcoin. In this article, we will explore popular and secure methods of cryptocurrency storage.
A bitcoin wallet is a digital wallet used for sending, receiving and storing BTC. It is the digital equivalent of a physical wallet, but instead of physical money, it stores cryptographic information necessary for accessing bitcoin addresses and conducting transactions.
A bitcoin wallet can be either in the form of a device or an application. Despite the name, it does not “store” bitcoins, but rather has cryptographic control over addresses on the blockchain.
Difference between an address, key and wallet
A bitcoin wallet is a type of digital wallet used to send and receive BTC. It is analogous to a physical wallet but instead of storing physical money, the wallet stores the cryptographic information necessary to access bitcoin addresses and carry out transactions.
A Bitcoin wallet can be either a device or a program. Contrary to popular belief, this wallet does not “store” bitcoins but provides cryptographic control over the blockchain address.
Difference between address, key and crypto wallet
To understand how a crypto wallet works, let’s examine several related concepts: the address, public key and private key.
A wallet address is a randomly generated unique combination of numbers and letters that functions like a bank account number. It typically consists of 26-35 characters. For example, here is what the first Bitcoin address looked like: 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa. Since the Bitcoin network is pseudonymous, anyone who knows the wallet address can view the assets and transactions of the BTC owner.
A wallet’s address is also referred to as its public key. It is used in conjunction with the private key to secure assets.
The private key is akin to a PIN for a bank card. Only by knowing the private key, can one gain access to coins or conduct a transaction.
Types of crypto wallets
Wallets can be categorised as hot and cold. To choose the right storage solution for your assets, pay attention to the key properties of each type.
Hot wallets require a constant internet connection. Examples include exchange accounts, online services, smartphone apps, and some desktop wallets. Hot services are always available and convenient for frequent transactions. They are easy to install and set up. An example of a hot wallet is the EXMO.com wallet.
Cold wallets are crypto accounts that do not require a constant internet connection. They are suitable for long-term storage of large amounts of funds you donโt need quick access to. Hardware wallets, which store a user’s private keys, fall into this category. They resemble USB drives.
Despite their enhanced security, hardware wallets are less convenient than hot wallets. Working with them requires two devices: the wallet itself and a computer with internet access. Another drawback of cold storage is the cost involved, as hardware wallets can range between $50 and $200.
How to create a BTC wallet on EXMO.com
On EXMO.com, you can use an online wallet for storing cryptocurrency assets. To do this, create an account on the exchange and generate a wallet address. The EXMO.com wallet is suitable for storing not only bitcoin, but also other assets and fiat currencies. Additionally, both web and mobile versions of the wallet are available to traders and holders.
How to top up a bitcoin wallet
After successfully registering on EXMO.com, you can top up your bitcoin wallet as follows:
- In your account, go to the “Wallet” section.
- Find BTC in the list of available cryptocurrencies and click “Deposit”.
- In the pop-up window, you can generate and copy your wallet address. After funding, the received Bitcoins will appear in your wallet.
You can also top up the wallet by purchasing coins through Simple Trade at the current rate, by creating an order in the Advanced Trade tab or via the Buy Crypto section with a bank card. For more details on these methods, read the following articles: “How to deposit funds” and “How to buy crypto with a bank card”.
Security measures for bitcoin storage
To minimise the risk of cryptocurrency loss, follow a few simple rules:
- Enable all available security methods: a strong password, a seed phrase, SMS notifications, a list of allowed IP addresses and more.
- Set up Two-factor authentication for your exchange account and the email address provided during registration on EXMO.com.
- Store significant amounts only in cold wallets.
- Use hot wallets for trading and transfers.
- Avoid keeping all your coins in one place.