Crypto for Beginners: How to Setup Your First Wallet

Option 1: Keep it on the exchange

Under the “accounts” tab, a Coinbase user can see wallet details.

Option 2: Hardware Wallet

  • private keys are often stored in a protected area of a microcontroller, and cannot be transferred out of the device in plaintext
  • immune to computer viruses that steal from software wallets
  • can be used securely and interactively, as opposed to a paper wallet which must be imported to software at some point
  • much of the time, the software is open source, allowing a user to validate the entire operation of the device (Source)
The Nano Ledger S
  1. Purchase a hardware wallet. I recommend the Ledger Nano S. You can buy one on Amazon.
  2. Plug in your Nano S with the USB cable to an internet-enabled computer and follow the on-screen instructions.
  3. You can then choose to make a new wallet or import a wallet.
  4. Choose a PIN code. Make sure your PIN is memorable because three wrong PIN entries will reset your Nano S.
  5. Backup your recovery phrase. A recovery phrase is a 24 word mnemonic phrase designed to recover your device if you forget your PIN of if your Nano S is lost or stolen. Keep your “recovery sheet” in a safe place. (Ideally, stored in a safe)
  6. Install the Ledger apps on your computer to use your device and access your wallet. There are Chrome extensions that make this a breeze.

Option 3: Soft Wallets

  1. Check to see if the coin you want to store in a desktop wallet offers this as an option. Most will offer a desktop wallet.
  2. Download the desktop wallet software from the Github or the coin’s website. An example I will use is the Neon Wallet, a wallet designed specifically for NEO and Nep-5 coins (coins built on the NEO blockchain)
  3. Install the software and fire it up. All desktop wallets are different, but you will at minimum have options to create a wallet and access it, and once accessed you can see funds available and transaction history.
  4. To decrypt a wallet you created, you need to copy and paste your private key into the wallet software.
The NEON Wallet interface. Note: I grabbed this from Google, so I have no idea whose public address that is.
The landing page for My Ether Wallet
  1. Go to www.myetherwallet.com. As a matter of security, don’t trust even the link I just offered you. Type that into your browser directly and make sure there is a little “lock” symbol next to the URL showing the link is secure and begins with “https.”
  2. Click through the notices provided by My Ether Wallet that explain the website and how it works.
  3. Begin the wallet creation process by inputting a password.
  4. Download the Keystore File. This file allows you to decrypt your wallet just like a private key does, so if you lose it or someone gains access to it, your coins are jeopardized. Save this file on a USB stick, put it in a ziploc bag or waterproof container, and hide it in a safe.
  5. Click “I understand, continue” and you will see your private key. Save this key by printing your paper wallet. Store this in a safe in a ziploc bag with the USB stick.
  6. MEW then gives you options for how you want to access your wallet for the first time. If you’re not using a Ledger Nano, you can upload the Keystore file you just downloaded or copy and paste the private key. It is safer to use the Keystore file because malware cannot attack it like they can your copy and paste command. Notice the Ledger Wallet is an option. This will decrypt your wallet and you can access your coins.

Option 4: Cold Wallet

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