We are all familiar with the incredible increase in use of crypto in the world since 2011 on both the producer and the user side. There are 221 Million global crypto users in the ecosystem based on 2021 data from Statista and when you search for the word crypto wallet, 107 million results come out.
https://www.statista.com/statistics/1202503/global-cryptocurrency-user-base/
There are hundreds of wallet options. So, do you know which one to choose and what your wallet will provide you? Here’s the answer:
Buying cryptocurrencies has never been easier, but learning how to manage them properly and safely requires a lot more effort. This is where cryptocurrency wallets come into the picture.
Just as a bank account is important in traditional finance, wallet addresses are pertinent for any crypto trader or investor.
This article will explain the significance of crypto wallets, the various wallet types, and how to safeguard your crypto using popular wallets like Metamask, Trust, and Getwallet.
What are Cryptocurrency Wallets?
A cryptocurrency wallet is any device or application that holds a user’s secret keys for crypto transactions. The pertinent wallet stores the keys that are used to sign cryptocurrency transactions. In addition, a wallet provides an interface that allows users to easily access their cryptocurrency.
Initially, transferring crypto was a difficult operation that required long alphanumeric keys to be entered. However, as crypto adoption and technology grew, modern wallets have made it easier to transfer cryptos. Trust wallet and Metamask are two prominent modern cryptocurrency wallets, to name a few.
Interestingly, when Satoshi Nakamoto originally unveiled the Bitcoin protocol in 2009, he also designed the first cryptocurrency wallet. Although Bitcoin is the most widely used cryptocurrency, other cryptocurrencies have arisen and can all be managed via a similar wallet.
How Do Cryptocurrency Wallets Work?
To put it simply, crypto wallets share similarities with the conventional banking system. A sender can only transfer money to a receiver in the banking system if he has the receiver’s account information. Likewise, a wallet address can be shared to both receive and send cryptocurrency.
Unlike bank account numbers, wallet addresses are made up of random alphanumeric characters. For example, a wallet address may look like this: 0x3CE825CDe27f8ca14Fafd4232b83b5A14194F5.
Moreso, one can also transfer their crypto via online applications. In short, the sender inputs the receiver’s wallet address for the particular cryptocurrency needed and also the amount to be sent. Usually, a negligible transaction fee is generated, and the crypto is sent to the receiver.
There is no action required on the receiver’s end other than sending the wallet address and waiting for a successful transaction.
While one might think that a crypto wallet functions just like a physical wallet. Technically, it is not the case, one’s crypto coins are not “stored directly” into a crypto wallet, Instead, the wallet essentially stores the coins’ private keys. It is also worth noting that each cryptocurrency uses a distinct blockchain protocol. Hence, using the same wallet address for Bitcoin, Dogecoin, Ethereum, and Binance Coin is not possible.
Types of Cryptocurrency Wallets
Wallets are usually classified into two types: software wallets and hardware wallets.
Hardware
A hardware wallet, also known as a cold wallet, works offline by storing the users’ private keys in a secure hardware device. This wallet gadget is comparable to a USB flash drive. One significant advantage of a hardware wallet over its equivalent is security. Additionally, since hardware wallets are not connected to the internet, they are considerably more difficult to hack.
On the flip side, if sufficient care is not taken, even hardware wallet devices may be lost, stolen, or destroyed. Among the most popular hardware wallets are the Ledger Nano, Trezor variants, and SafePal.
Software
A software wallet, on the other hand, is any wallet that is connected to the internet. Software wallets are simple to use and accessible. However, they come with the single caveat of being vulnerable to hackers. There are several types of software wallets, including desktop wallets, web wallets, and mobile wallets. When using software wallets (also called hot wallets), one piece of general advice is to avoid storing large quantities of cryptocurrencies in them.
For technical purposes, crypto wallets can also be categorized as Custodial and Non-custodial. Custodial wallets are usually managed by a third party, such as a crypto exchange or security firm. In the case of non-custodial wallets, the user retains complete control over their keys and assets.
Here are some noteworthy cryptocurrency wallets.
Getwallet
Getwallet is a Web3 crypto wallet created by the developers of the Getcontact app, a caller identification tool. Getwallet addresses the problems of long wallet addresses and complex transactions, which often result in transaction issues. Getwallet’s native algorithm help avoid these issues.
The wallet is also one of the easiest and most accessible, especially to beginning users. Getwallet simplifies crypto transactions by allowing users to send and receive money using only their phone numbers. This new wallet also has its own utility token, Getcoin, which is set to launch later this year.
Binance Chain Wallet
Binance Chain Wallet is Binance’s official crypto wallet that allows users to access ecosystems such as Binance Smart Chain, Binance Chain, and Ethereum. It can be used to access cryptocurrency as well as connect to a variety of blockchain initiatives. This wallet is computer-compatible and already supports Chrome, Firefox, and Brave browsers.
Trust Wallet
Trust Wallet is a decentralized wallet in which the user manages their crypto wallet’s private keys. The use of Trust Wallet grants the user access to decentralized applications (dApps). In addition, unlike centralized wallets, it allows the user complete control over their cryptocurrency.
Crypto Exchanges vs Crypto Wallets
A cryptocurrency wallet allows an investor to keep all of their cryptocurrency in one location. In the case of a non-custodial wallet, it also allows complete control over the use and transfer of funds. The user will be handed his private keys in a crypto wallet such as Trust Wallet, which are supposed to be kept safely. Crypto wallets are frequently used for hodling, which is the practice of keeping a cryptocurrency in anticipation of future returns.
In contrast, a cryptocurrency exchange allows users to trade cryptocurrencies or convert fiat currency into digital currency. Due to the high volume of transactions on the exchange, cryptocurrency can be quickly traded to other users. However, it comes at a cost. Using a crypto exchange implies they have access to your keys.
How to Keep your Crypto Wallet Safe
One of the main reasons why people have been reluctant to engage in cryptocurrency investment is the security risks. This is especially true when the investor is ultimately responsible for protecting a cryptocurrency investment. However, there are a few steps you can take to protect your cryptocurrencies.
- Store your cryptocurrency in a “cold” wallet.
- Use a reputable exchange to buy or sell crypto.
- Change your password on a regular basis and employ a password manager if possible.
- Use multi-factor authentication to secure your account.
- Be wary of phishing attempts.
Other things to do include avoiding public WiFi, installing software security updates, and staying up to date on the latest exploiting tactics.
Advantage of Getwallet Over its Competitors
Getwallet enables easy crypto transfer by using only a phone number, which makes it as simple as sending SMS. In a world where crypto adoption is increasing by the day, Getwallet is leading the way in accessibility.
Indeed, Getwallet’s method is different from other wallets, and is intent on reducing transaction misappropriation as much as possible. Getwallet features low transaction fees and is a product focused on the growing decentralized finance revolution.
As discussed earlier, to increase security and decrease susceptibility to hacks, users of Getwallet will have total control of their crypto.
Notably, Getwallet focuses majorly on its users, rather than an “investor-demand approach”. Consequently, this strategy will provide some of its early users with first-come access to its native token, Getcoin.
In all, Getwallet fills a niche that is even more necessary in a world already embracing crypto — ease, and accessibility. With time, it hopes to lead the way into a dominant crypto-positive world.
