Digital wallet
Bitcoin Wallet is a digital wallet that allows bitcoin virtual currencies to be held, much like a regular wallet that you hold in your pocket for holding money. This guide will give you order in the whole bitcoin wallet issue. If you have not yet read the guide to which Bitcoin is and how it was created – now is the time!.
Just as if you want to buy a particular product you need a wallet to put your money there, so does the world of bitcoin.
To buy and sell bitcoin, one must first understand how to choose a bitcoin wallet, how to open and of course how to use it. this is the guide that explains everything about it to you. ready? forward.
hot wallet or cold wallet?
Well, the first thing you need to know is whether you need a hot wallet or a cold wallet. to answer this question, first of all it is necessary to understand what are hot wallets and what are cold wallets.
hot wallet
a hot wallet is a digital wallet connected to the blockchain network over the internet, these wallets allow quick access to the virtual currencies (or by another name, cryptocurrencies) mainly for the purpose of sending and quickly receiving bitcoin funds.
Since a hot wallet is always connected to the internet, its level of security is lower, there is a chance that it will be hackable (or like everything else on the internet) by experienced hackers.
To compare to the tangible world, you can think that a hot wallet is like a passerby in your bank account.
cold wallet
Unlike the previous one, a cold wallet is a wallet that is not connected to the blockchain network through the internet on an ongoing basis. this wallet is less suitable for daily use, but on the other hand it has a significantly higher level of security than a hot wallet.
To compare to the real world, you can assume that a cold wallet is like your pension savings or deposit.
Another example of comparison between them: a hot wallet is intended for those who wish to trade bitcoin intraday, that is, to buy and sell on the same day, on the other hand, a cold wallet is intended for those who wish to invest in bitcoin in the longer term.
If you make mixed use, that is, you purchase services frequently and on the other hand you want to invest in the belief that the value of the currency will increase, you need 2 wallets, it's also hot and cold.
In this case, it is recommended to distribute the money in a way that is suitable for covering your day-to-day activities and in contrast to holding a larger amount with higher security.
What kind of wallet do you need?
There are lots of virtual wallets, enough to write it down in search engines and find thousands of different wallets.
Of course, you need to know what type of wallet, whether it is hardware or software, for a computer or a Smartphone.
digital wallet on computer
a Computer wallet, the kind of software that's on your computer, like other software you install on your computer.
The advantage of it being installed on your computer provides you with greater protection and full control over your bitcoin.
The main drawback is that you need high security for your computer, including a powerful antivirus that can protect you from attacks and malware.
The other downside is that if your computer is destroyed or disabled, you will no longer have access to your funds.
digital wallet in a Smartphone
a Smartphone wallet (or mobile) is an app type software, like the other apps installed on your phone, bitcoin will be stored on your mobile device.
The advantage is that a Smartphone is a mobile device and therefore it is easier to manage when you need to make a purchase or purchase of bitcoin, but on the other hand, Smartphone's can be stolen or destroyed, so you'll lose all your money.
digital wallet on the internet
A bitcoin wallet on the internet allows you to manage your bitcoins over the internet and especially through the website of the provider that offers the digital wallet.
The main advantage is that you can access it from anywhere in the world provided that there is an internet connection and usually by entering a site with a username and password.
Also, you don't have to worry about your wallet settings, managing your bitcoin addresses, and private keys – which will make it significantly easier to use you.
On the other hand, because it is connected to the network, and all the information is public, it arouses interest in hackers who may hack into the company's servers that offer your wallet and denounce your bitcoin information, which will provide hackers to do whatever they want with your money.
Another thing, if there is a security breach or lawsuit against the supplier, the company may close and prevent you from accessing your bitcoin or some of them.
hardware wallet
Hardware wallets are physical wallets like the USB on which all your information and bitcoins stored.
There is a clear advantage to this, that they cannot be hacked unless the device is connected to the computer – this constitutes a very high level of security.
On the other hand, since it is a hardware wallet, it costs money and therefore it is a kind of disadvantage compared to the other solutions, the second downside is that such a wallet can also be destroyed, stolen or eroded.
paper wallet
a paper wallet is also a type of bitcoin wallet with which bitcoin can be stored. a paper wallet is completely physical which is written on paper or engraved on metal.
Much like the printout of your bank account – if it is destroyed or lost, all bitcoins stored in it will disappear for good.
How to open a digital wallet?
Simply choose what type of wallet you want and what type of wallet you want and what it's based on.
You should then open it, either by downloading an app, downloading software to your computer, purchasing hardware, or by opening a digital wallet online.
After you have followed the previous step (break above), you can start the opening stage. at this point you can choose whether to open a new wallet or restore an existing wallet, once you've filled in the necessary details, you'll be transferred to your wallet.
In most wallets, in the process of opening a new wallet, you will receive a sequence of a few words whose purpose is to protect you for the purpose of backing up your wallet.
This sequence is unique to your wallet and unparalleled, if your wallet is destroyed, you can transfer and restore your bitcoin to another digital wallet by sequence of these words, all of which is of course that your account did not lose bitcoin due to hacking and theft.
It is very useful to keep these details in a safe place, so you can access it at any time, provided that these details are as secure as possible. it is recommended to store it in an accessible and secure place, and if you also need to write on a paper note and keep it in a safe.
how to use a digital wallet?
After you have finished the registration process and the word sequence acceptance process, you can start transferring (send and receiving) bitcoin coins.
In order to receive a digital currency, the user who transfers the money to you needs to receive your public ID key (called Public Key), this key includes a sequence of numbers and letters and is your unique wallet address. Sometimes you can also get a QR code, which is like a barcode that is an alternative to your public key and mainly saves typing and prevents errors of typo (if not copied but typed).
Of course, the user who wants to make a bitcoin transfer, or other digital currencies, should also type in the amount and prioritization level of the execution of the action.
As a rule, the higher the prioritization (i.e. the time of transfer of money), the higher the commission, the fee is actually the amount you pay for the transfer of digital currencies between different wallets.
Where do you open a bitcoin wallet?
There are several popular sites in the world that provide a bitcoin wallet service. they are recommended in the world so we publish them here.
blockchain.info
blockchain info is one of the software companies that provides a digital wallet on the network and can be held through it many different digital currencies and not just bitcoin.
This company has over 100 million transactions and includes users in 140 countries around the world. the blockchain has over 21 million digital wallets and there are 160,000 transactions every day!
in the past year, the virtual wallet was available over 99.53% of the time, there were about 80 breaks and a total inactivity time was about 3 1/2 hours.
In other words, the wallet is very available, and it is almost always possible to make a currency transfer.
Jaxx
Jaxx Is a popular software wallet through which you can purchase many types of virtual currencies and not only Bitcoin, but also Bitcoin Cash, Ethereum, Litecoin, Dash, and more.
Jaxx digital wallet, can be downloaded to a large number of mobile devices such as Android, iOS, Windows computers, Mac computers, Linux computers, and even have a chrome browser extension.
Mycelium
This is an iOS and Android mobile phone app type digital wallet. It can be linked to other accounts through API connectivity, so you can actually pay for different accounts, product purchases, etc.
Trezor
It's a hardware – type wallet when it connects to your computer in the tips of a simple USB cable. The cost of purchasing the device is 89€ and is suitable for Windows, Linux, Mac and Android system.
By embellishing this wallet you can purchase different types of virtual currencies.
Summary
Try to choose a digital wallet that best suits your needs, if you care about a combination of actions, then try both a hot wallet and a cold wallet. if you are suspicious and do not want to put all the eggs in one basket, use several digital wallets for different purposes.
Always remember that security is one of the most important things, so it is forbidden to skip this step. if a digital wallet offers you additional security on your existing security (like the word sequence), consider it.
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