The Crytocurrencies in Detail!

by Ali S. Earn with Us!

All cryptocurrencies are kept in what is known as a wallet.

There are 6 distinctly different types of wallets; web, mobile, desktop, hardware, paper and the least commonly used brain wallet. Some types of wallets allow you to store more than 1 different kind of cryptocurrency.

Web wallets

Web wallets are probably the most commonly used bitcoin wallet. While not the safest option, web wallets allow people to transact anywhere. Some web wallets offer some very good security so when choosing a web wallet, you want something that offers really terrific security. Coinbase.com are a very popular web wallet, as well as being an exchange and a merchant account provider. Coinbase allow anyone from any country to open a bitcoin wallet, but not all countries are allowed to buy and sell or make use of the merchant facility. All other functions of coinbase are fully functional. Coinbase not only allows you to store your bitcoin, Ethereum and Litecoin, but they also allow you to buy and sell, providing you're in one of the countries that they have approved to use the exchange.

Coinbase have a variation of security measure in place such as 2FA and the option of authy or google authenticator, requiring you to enter a secret code every time you access your account or send any bitcoin to anyone. Coinbase also make use of a "Vault" which is a much more secure wallet and is free to use. The "Vault" is actually what is referred to as cold storage or a hardware wallet.

Any bitcoins that are deposited into the vault are then moved to a device that stores bitcoin offline to prevent hackers from accessing them and can only be withdrawn after 2 days notice. iCoinPro highly recommends coinbase as a reliable and secure web wallet. Other wallets worth checking out include Xapo and blockchain.info. Xapo offer a debit card that can be used to directly spend funds in your wallet.

Mobile wallets

Mobile wallets are, as the name suggests, cryptocurrency wallets for a smart phone or mobile device such as an ipad. Security wise, they are questionable because if you lose your phone, you lose your wallet. Some wallets allow you to restore to another phone as long as you provide some secret security keys that they give you when you install your wallet. Most, if not all mobile wallets have a built in QR scanner to scan bitcoin addresses from a QR code. MyCelium is one of the most popular mobile wallets

Previously the only wallets for desktops also ran a copy of the bitcoin software that powers the bitcoin blockchain and thus a desktop would become a node in the network, carrying with it a copy of the entire bitcoin database, every bitcoin, every transaction ever. Most people wouldn't do this and much simpler wallets exist. Exodus is a very popular and easy to use desktop wallet that caters for bitcoin, ethereum, golem, litecoin and dogecoin.

Similarly, the same security problems exist as with a mobile phone-- if the desktop is stolen, lost or damaged- the wallet and contents are gone. Should you decide to use a desktop wallet, make regular backups of all your files to an external drive and safeguard it.

Hardware wallets.

Hardware wallets offer the most protection but are not viable to use on a daily basis. They are great (as well as super secure) as a storage facility because once your cryptocurrencies are moved onto the device, the device can be disconnected from the internet and can not be hacked into. A popular, affordable offline or hardware wallet is the ledger nano s. It allows you to store dash, ethereum, bitcoin and litecoin safely and securely.

Paper wallets.

Paper wallets offer another high security way of storing cryptocurrency and it's an easy process to master. All cryptocurrencies have 2 parts, a public key and a private key which need each other in order to prove the validity of the coin - while using most other wallets, one would not often see or make use of the private keys, but to create a paper wallet, both the private and public keys are printed on paper and in the process the coin is then "transferred" off the internet and now exists on paper which can then be stored away or even used similarly to paper cash. In order to use the paper wallet again, the addresses are scanned using an app on a mobile phone and the funds are sent to another wallet. The benefits of paper wallets are that once you have printed them off, they are safe from hackers but are still subject to loss, theft or damage so if you go this route - you need to ensure that you store your paper wallets in a very secure place. It might even be a good idea to laminate them to prevent water damage or ink degradation.

A brain wallet is not common and because cryptocurrency addresses are too long and difficult to remember - a brain wallet allows you to think up and create a secure passphrase that only you know and can remember which is then used to create the public address and private key, then funds can be sent to the generated address and any evidence can be destroyed. The pass phrase can then later be used to reconstruct the wallet and funds can be imported to a regular wallet.