Crypto wallets from A to Z
You have exchanged some fiat money for cryptocurrency. So, you have just made a step into the new and technological reality. But how does everything work in here?
Well, the basic categories are the same with physical world: you have money, you can store it, exchange, spend, receive, invest, but now all these processes are digital thanks to blockchain technologies. It is much safer, cheaper and easier to transact cryptocurrencies to pay for something, so more and more people are joining the mainstream.
The Noah Project has been developing its own cryptocurrency called Noah Coin (NOAH). It gives its holders a lot of privileges like discounts and special offers in the Noah City and Noah Resort, low remittance fees and an opportunity to purchase goods in online retail stores provided by our partner — a payment gateway PayRemit. We do our best to bring modern technologies into the lives of common people from the Philippines and all over the world.
The Global Cryptocurrency Benchmarking Study gathered data from more than 100 cryptocurrency companies in 38 countries, capturing 75% of the cryptocurrency industry. According to this research, more than 3 million people are actively using cryptocurrencies nowadays. It is a pretty rough estimation because it’s almost impossible to trace all crypto holders due to the high security of blockchain-based accounts.
How do these people store their crypto assets?
They obviously keep them in the wallet, but in the context of cryptocurrencies it should be a digital one. In fact, these wallets don’t store currencies — simply because digital currencies don’t exist in the physical world. They are basically records of transactions stored in the blockchain. So, cryptocurrency wallets represent a software which can store your public and private keys. Users can monitor the balance, send and receive money and perform other operations with it. When you send coins you actually transfer the ownership of your coin to the recipient. Blockchain guarantees the security of transactions checking that private keys of the recipient and match the public address that you sent the coins to. You get total control of your assets excluding intermediaries who charge high fees. This is how the digital wallets work.
Also, there are different types of crypto wallets in three basic categories: software, hardware, and paper.
Software wallets include:
1. Desktop wallets that are downloaded and installed on a PC or laptop. You can use it only on the computer in which it is downloaded. This way it ensures a high level of security until your PC is hacked or virus-infected.
2. Online wallets which represent a cloud software and can be used from any device and any place with an Internet access. These wallets are convenient but definitely lack security and reliability because they include the third party controlling transactions.
3. Mobile wallets that run on an app on the smartphone are becoming more popular among users nowadays as they enable easy transactions anytime and anywhere.
Hardware wallets are cold wallets. They differ from the software ones in that they store currencies on a special device which looks like a USB and are not connected to the Internet directly. Hardware storage is the least convenient to store digital currencies. but the most secure as all the keys are stored offline and can’t be attacked by hackers. To make a transaction you should connect this USB to the PC with an Internet access, enter a pin, perform the operations needed and confirm them.
Paper wallets are physical copies or print-outs of your public and private keys. Also, this term can refer to a piece of software that is used to securely generate a pair of keys which are then printed. To make a transaction you should enter your private keys or scan the QR code from the paper wallet into your software wallet.
One more classification of digital wallets consists of cold storage and hot storage. Cold storage provides a high level of security as users don’t store private keys online but on a device (a pretty expensive one) with a strong encryption and password enforcement. Though it’s very secure, cold storage may not suit for quick and regular transactions.
Hot storage is free and gives a quick access to cryptocurrency. It’s a real-world analogy of keeping much cash with you — there is always a risk of theft or fraud.
If you want the examples of good wallets, here they are:
Exodus enables the storage and trading of Bitcoin, Ether, Litecoin, Dogecoin and Dash. The wallet has useful options such as backup and a built-in shapeshift exchange. The disadvantage is the absence of a web interface or a mobile app.
Blockchain.info is one of the most popular Bitcoin wallets. Desktop version has a two-factor authentication, and mobile users can activate a pin code requirement every time the app is opened. The wallet has no access to your private keys, but still it lacks privacy and has experienced outages.
The Ledger Wallet Nano is a compact USB device based on a smart card. It has Multi-Currency support and is not expensive, but it can’t create hidden accounts and has no password manager.
There are many other wallets such as Copay, Armory, Green Address, Trezor, Jaxx,which description you can find on their websites.
Any digital wallet has its pros and cons, and the Noah Project also gets into the game. We’ve launched our own wallet called Noah Wallet.
Among competitive advantages of Noah Wallet are:
- an intuitive design for both crypto newcomers and professionals
- convenient and instant transactions through the use of QR code
- recording of all the user’s transactions in the history
- a backup function to restore the wallet if necessary
- strong security measures ensuring that the crypto assets are stored and transacted safely.
As you can see, it is easy to use, cheap and secure due to blockchain features. Noah Wallet offers all the main wallet functions like sending, receiving, storing cryptocurrencies, including NOAH. We moved even further. Our alliance with PayRemit opens new perspectives for NOAH holders to spend their coins: buy gifts, flowers, toys, food, plane tickets, pay for different services from PayRemit partner merchants. With Noah Wallet people can do it even more easily, so we’re definitely on track to build the technological future.