@benglabs
One of the hallmark qualities of cryptocurrency is its virtuality. Unlike most other forms of currency, crypto has no physical embodiment. You can’t get it as paper, coin, bar of gold or fancy bead. There’s no token that needs to be locked up in a bank vault or buried beneath a mattress.
But like anything valuable, cryptocurrency needs to be protected. It exists as a natively digital entity that requires an internet connection for any transaction — and that connectedness makes it vulnerable to hacking. In fact, despite its ethereal nature, it’s at least as susceptible to plunder as cash or gold. And with cryptocurrency, these violations are likely to come remotely.
Read: Bitcoin explained — everything you need to know
Many newcomers buy cryptocurrency from an exchange, such as Coinbase or BitFlyer, and leave their holdings in those sites’ “custodial” wallets. But like any other online entity, the exchanges are vulnerable to hacking — and as the crossroads for many billions of dollars of transactions every day, they make for particularly attractive targets. The cautionary tales of Mt. Gox, which “lost” 750,000 of its customers’ bitcoins in 2014;NiceHash, which was robbed of $60 million in December 2017; and a recent close call at Binanceshow the risks associated with leaving your coins in an exchange’s online wallet.
Conventional wisdom dictates that if you’ve got more virtual currency than you’d be comfortable carrying around on your person, or you intend to hold it as a long-term investment, you should keep it in “cold storage.” This could be a computer that’s disconnected from the internet or a specialized USB drive called a hardware wallet. (We’ll take a look at how those work in a future explainer.)
Dedicating a computer to store your cryptocurrency or shelling out for a hardware wallet isn’t an option for everyone, however. Well known devices such as the Trezor and Ledger cost between $75 and $100 and, by design, add complexity and a few extra steps to every transaction. Software wallets, by contrast, are usually free and easily accessed though, ultimately, less secure.
Now Playing: Watch this: What the heck is blockchain?
1:49
A cryptocurrency wallet’s primary function is to store the public and private keys you need to conduct a transaction on the blockchain. Many also offer features such as integrated currency swapping. There are three main kinds of software wallets — desktop, online and mobile — and each offers a different combination of convenience and security.
Desktop wallets are software you install on your computer. They give you lots of control over your assets but, if connected to the internet, remain vulnerable. A malware infection, the remote takeover of your computer or — even if you’re not online — a hard-drive failure could be a catastrophe.
Read:Blockchain Decoded on CNET
Online wallets are hosted on a website. This makes them convenient because they’re accessible from any internet-connected device. The downside: Your private keys are (theoretically) known to the website owner and, from a technical perspective, there’s not much to stop them from simply taking your coins.
Mobile app wallets are optimized for retail transactions — that is, paying for stuff with bitcoin or another cryptocurrency. But because your encryption keys are stored on your phone, you lose your coins if you lose your device. You thought it was a bummer to leave your phone in a taxi? Imagine how bad it will be if it has thousands of dollars of cryptocurrency locked on it.
Whether you choose a hardware, software or paper wallet to manage your passwords and private keys, there are a handful of things you can do to keep your stash safer. These include:
We’ll take a high-level view of some well known software wallets to provide an overview of the different features and tradeoffs to consider.
Note: There are many wallet options available, and we have not comprehensively tested any of these. As such, we cannot recommend any of them. As with everything related to cryptocurrency, you are advised to do your own research before making any decisions. Caveat emptor!
A versatile online wallet, Jaxx can be installed on a computer (Windows, Mac or Linux), added as an extension to the Chrome web browser, or downloaded as an app on an Android or Apple phone or tablet. In addition to helping you store dozens of cryptocurrencies, Jaxx’s support for the ShapeShift API makes it easy to swap coins — say, Litecoin for Ether — right inside the wallet. ShapeShift’s exchange rates aren’t always as low as what you’ll find on major exchanges and they do charge a transaction fee (or “miner fee”), which was about 40 cents on the Bitcoin to Ether transaction we priced out. Jaxx offers novices an easy pathway into alt-coins that aren’t yet supported by Coinbase or Bittrex.
Learn more: jaxx.io
Super simple to install and use, MetaMask is a specialist, supporting only ERC20 tokens — that is, any cryptocurrency built on the Ethereum platform. The good news: there are about 50,000 or so tokens (and projects) built on Ethereum, accounting for roughly 90 percent of the total cryptocurrency market cap, which was more than $200 billionat the time of writing, according to CoinMarketCap.com.
MetaMask can be used to send, receive and store Ethereum tokens and private keys. All of the data is encrypted and stored locally, making it difficult for the developers or anyone else to steal your keys or coins remotely. And, in addition to its storage and transactional capabilities, the MetaMask extension connects most web browsers (Chrome, Firefox, Opera and Brave) with the growing universe of decentralized applications, also known as dApps, being built on the Ethereum platform.
Learn more: metamask.io
The Exodus software wallet is a good entry-level wallet for cryptocurrency newcomers. It’s known for responsive customer support, copious user documentation and a refined design and interface. It accommodates dozens of coins (here’s a full list) and was the first wallet to support Shapeshift. There’s no mobile app yet, however, and Exodus doesn’t offer two-factor authentication or multisignature addressing, which gives you the power to require approval from multiple devices before finalizing a transaction. This could give security-minded coin owners pause.
Learn more: exodus.io
One of the first mobile wallets, Mycelium has since established a solid reputation as a secure and user-friendly way to store bitcoin (and, so far, only bitcoin). Like any credible wallet, it lets you generate a set of 12 “seed words” that will help you restore the wallet if you lose access to your private keys. There’s no desktop interface, but it can be used in tandem with a cold storage solution, managing your accounts on a hardware device like a Trezor or Ledger. (The company also produces a USB key that generates paper wallets; plug it into your printer and out comes a paper wallet without any need for a computer.)
Instead of using ShapeShifter, Mycelium runs its own reputation-based exchange platform, which helps coordinate bitcoin trades between buyers and sellers. Transactions incur a fee that ranges from about 70 cents to $8 depending on the priority you set — that is, how quickly you want it to be confirmed and added to the blockchain.
Learn more: wallet.mycelium.com
Remember: Do your own research before installing or using any of these wallet technologies — or trading or investing in any cryptocurrency.
Buying and selling bitcoin: A quick and dirty introduction to trading cryptocurrency.
Initial coin offerings, explained: How can this possibly be a legitimate way to raise money?
See the article here:
How to keep your cryptocurrency safe – CNET
- What Is Cryptocurrency? - dummies - April 21st, 2018
- Cryptocurrency Market Surges to $365 Billion, Start of a ... - April 21st, 2018
- BTCMANAGER | Bitcoin, Blockchain & Cryptocurrency News - April 16th, 2018
- How do I report Cryptocurrency Mining income? - TurboTax ... - April 4th, 2018
- When do you report Cryptocurrency investments? - TurboTax ... - April 4th, 2018
- Trading Cryptocurrency in 2018: The Definitive Guide - March 14th, 2018
- How would one operate a Cryptocurrency Mining Pool and ... - March 13th, 2018
- Coinbase cryptocurrency index fund - Business Insider - March 10th, 2018
- Cryptosomniac | Cryptocurrency Price Tracker - Bitcoin & Eth ... - February 24th, 2018
- Cryptocurrencies News & Prices | Markets Insider - February 22nd, 2018
- I started cryptocurrency mining at the end of 2017 and was ... - February 20th, 2018
- Cryptocurrency News - Bitcoin, Ethereum, NEO, ICO startups - February 8th, 2018
- 7 Best Cryptocurrency Exchanges to Buy/Sell Any ... - February 8th, 2018
- Electroneum. The Mobile Cryptocurrency. - February 8th, 2018
- Cryptocurrencies trading | your guide in the world of trading ... - February 5th, 2018
- Robinhood trading app introduces cryptocurrency - money.cnn.com - January 28th, 2018
- Robinhood adds zero-fee cryptocurrency trading and tracking ... - January 28th, 2018
- Cryptocurrency Price Prediction, Comparison, Analysis - January 22nd, 2018
- South Korea's major cryptocurrency exchanges ... - reuters.com - January 13th, 2018
- Bitcoin-crazy South Korea may face a ban on cryptocurrency ... - January 13th, 2018
- Cryptocurrency - IC Markets - January 13th, 2018
- Kodak launches cryptocurrency, stock pops 125% - Jan. 9, 2018 - January 10th, 2018
- The cryptocurrency bubble is strangling innovation | TechCrunch - January 9th, 2018
- Coinschedule - The best cryptocurrency ICOs (Initial Coin ... - January 8th, 2018
- CCN: Bitcoin, Ethereum, ICO, Blockchain & Cryptocurrency News - January 7th, 2018
- Cryptocurrency boom: Why everyone is talking about ripple - January 4th, 2018
- Cryptocurrency stocks holding gains despite bitcoin pullback ... - December 29th, 2017
- MobileCoin: A New Cryptocurrency From Signal Creator Moxie ... - December 16th, 2017
- Cryptocurrency Definition | Investopedia - December 6th, 2017
- '$300m in cryptocurrency' accidentally lost forever due to bug ... - November 10th, 2017
- Amazon might want in on cryptocurrency - mashable.com - November 8th, 2017
- What is Cryptocurrency - earnlite.com - October 26th, 2017
- Cryptojacking Lets Strangers Mine Cryptocurrency With Your ... - October 21st, 2017
- Introduction to Cryptocurrency - CryptoCurrency Facts - October 14th, 2017
- Cryptocurrency Flash Crash Is Said to Draw Scrutiny From CFTC ... - October 7th, 2017
- Cryptocurrency Alternatives to Bitcoin - due.com - October 7th, 2017
- Learn BitCoin and master the world of cryptocurrency - October 7th, 2017
- Almost Every Cryptocurrency Is Tanking Right Now | Time.com - September 7th, 2017
- Cryptocurrency boom stalls as regulators focus on ICOs ... - September 7th, 2017
- Why Marketers Need to Pay Attention to Cryptocurrency -- Now - Entrepreneur - September 7th, 2017
- Opinion: That Floyd Mayweather-backed cryptocurrency is another sign of a bursting bubble - MarketWatch - September 7th, 2017
- Putin-Backed Political Group Advances 'Green' Cryptocurrency Concept - CoinDesk - September 7th, 2017
- First He Beat Up His Girlfriend, Now He's Selling Cryptocurrency With Paris Hilton - Daily Beast - September 7th, 2017
- Cryptocurrencies have already recovered from last weekend's crash ... - TechCrunch - September 7th, 2017
- Venezuela Cracks Down On Cryptocurrency Mining - CryptoCoinsNews - September 4th, 2017
- Mobius Foresees Cryptocurrency Crackdown Sparking a Rush to Gold - Bloomberg - September 4th, 2017
- The Aggregate Cryptocurrency Market Cap Is Up 810% Year to Date - Motley Fool - September 4th, 2017
- How to make upwards of $1,000 a month by mining cryptocurrency - Mashable - September 2nd, 2017
- Chinese Officials Contemplate Suspending Cryptocurrency ICOs - The Merkle - September 2nd, 2017
- Cryptocurrency Investment Course 2017: Fund your ... - Udemy - September 2nd, 2017
- Six Banking Giants Just Decided to Partner to Create a New Cryptocurrency - Futurism - September 2nd, 2017
- 7 Cryptocurrency Predictions From the Experts - fortune.com - September 2nd, 2017
- Russia Could Pass Cryptocurrency Law This Year, Senior Lawmaker Says - CoinDesk - September 2nd, 2017
- AxionV: AI Cryptocurrency Fund Leading the Way in ICO Security - HuffPost - September 2nd, 2017
- PayThink Custom tokens are the future of cryptocurrency - PaymentsSource - September 1st, 2017
- Litecoin Prices Surge Above $70 as Crypto Market Tops $175 Billion - CoinDesk - September 1st, 2017
- Dharma wants to let anyone borrow a small amount of cryptocurrency - TechCrunch - September 1st, 2017
- PR: Archain Is Building an Uncensorable Internet Archive Inside a Cryptocurrency - Bitcoin News (press release) - August 31st, 2017
- Cryptocurrency Market Just Reached Total Value of $160 Billion - Futurism - August 31st, 2017
- Another banking trojan is trying to loot your cryptocurrency wallets - The Register - August 31st, 2017
- Cointal Revolutionizes P2P Cryptocurrency Trading - CryptoCoinsNews - August 31st, 2017
- $160 Billion: Cryptocurrency Market Sets New All-Time High ... - CoinDesk - August 30th, 2017
- Central Banks Can't Ignore the Cryptocurrency Boom - Bloomberg - August 30th, 2017
- Whoppercoin is a cryptocurrency you can eat or trade - The Verge - August 30th, 2017
- Learn about cryptocurrency mining with this interactive blockchain demo - TNW - August 30th, 2017
- Good Morning, Cryptocurrency! Vietnam To Create Legal Framework For Digital Assets - ETHNews - August 26th, 2017
- Cryptocurrency mining may void warranty on Inno3D GPUs - PC Gamer - August 26th, 2017
- Russian Deputy PM Says He Supports a State-Backed Cryptocurrency - CoinDesk - August 25th, 2017
- How to Learn About Cryptocurrency In The Bitcoin Era - Daily Beast - August 25th, 2017
- Bernanke to Give Keynote Speech at October Cryptocurrency Event - Bloomberg - August 25th, 2017
- Estonia wants to launch its own government-backed cryptocurrency called 'estcoin' - CNBC - August 25th, 2017
- Aimwise to Create Standards for Cryptocurrency Crowdsales - newsBTC - August 25th, 2017
- A Mysterious New Cryptocurrency Is Surging After Being ... - August 25th, 2017
- Cryptocurrency Cyber Crime Has Cost Victims Millions This Year - Bloomberg - August 25th, 2017
- This European country may hold an ICO and issue its own ... - TechCrunch - August 23rd, 2017
- Bitcoin Skeptic Mark Cuban to Invest in Cryptocurrency ... - August 23rd, 2017
- $150 Billion: Total Cryptocurrency Market Cap Hits New All-Time ... - CoinDesk - August 23rd, 2017
- Cryptocurrency Market cap Sets a New All-time High of Over $150bn - newsBTC - August 23rd, 2017
- South Africa's Central Bank: It's 'Too Risky' to Launch a Cryptocurrency - CoinDesk - August 23rd, 2017
- Mark Cuban backs new $20 million cryptocurrency venture fund - CNBC - August 22nd, 2017
Recent Comments