The first thing you want to do is get a crypto currency wallet and, thankfully, there are no shortage of options.
A Bitcoin wallet is a virtual wallet that holds your Bitcoin, or cryptocurrency. Think of it as a virtual bank, except you own and control it.
If you create a Coinbase account, you will have a wallet on their exchange to use while trading, though, I don’t recommend storing your currency in this wallet long term. If the exchange gets hacked while you still have currency in this wallet, you can lose all of it.
Every wallet will have its own address. It functions very similarly to a routing number at a bank. You will need it to move currency into your wallet.
Different types of wallets
There are two different types of cryptocurrency wallets: software wallets and hardware wallets. Let’s explore now the different types of wallets in more detail so you can better gauge which one might be the better option.
Online Wallets
An online wallet is a type of software wallet. It is stored on a website, and you can access it from anywhere. They are a bit less secure because they are connected to the internet, but, nonetheless, they are very convenient.
App Wallets
Mobile wallets let you keep your crypto on your smartphone. This is also very convenient because of the easy access to your currency. It also provides an easy way to use your coins for day-to-day purchases. An example of a secure and user friendly app wallet is Gemini.
That being said, they are less secure because smartphones are an easy target for hackers.
Desktop Wallets
Desktop wallets are software wallets that you download straight to your computer. Most only support 1 coin, so you will need a separate wallet for each coin.
These wallets are more secure, however, one big drawback is that many of them require you to download that coin’s entire blockchain history before use. This can be several Gigabytes of data and sometimes take days.
Hardware Wallets
Hardware wallets are reputably the most secure. They are a USB like device that are only connected to the internet when you plug them in to move crypto in or out.
Even if you lose, or your wallet is stolen, it doesn’t necessarily mean that your coins are at risk. Many hardware wallets allow you to set a multi-digit pin, which needs to be typed in before accessing the device to withdraw coins. In other words, if your hardware wallet is stolen, your coins are still safe due to the added layer of security.
If you plan to have large amounts of bitcoin, this is the safest way to store them. It can also be the most expensive because of the additional security. I would recommend the Keep Key wallet by Shapeshift. It is not as expensive as some of the other wallets but still very secure and easy to use.
Paper Wallets
A paper wallet is simply a method by which your private keys are actually stored on a piece of paper (or written down on any other offline medium).
Paper wallets can be a good, but also more affordable, alternative to hardware wallets.
Where Do I Buy Bitcoin?
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