Digital Wallets

How Do Wallets Work?

'There Are Two Main Types Of Wallets - It Is Important To Understand The Difference'

Digital Wallets are probably the second-most important thing next to the actual cryptocurrencies you purchase.

When you buy cryptocurrency, you need storage simultaneously, and that’s why we are going to take through the crypto storage steps. It’s like when you buy coffee at a cafe; you require a cup at the precisely the same time, unlike the crypto world where you bring your cup. That crypto cup is a “wallet” which can be either “software” or “hardware”.

Here at Crypto Space Australia, we recommend using a hardware wallet as it is impossible to hack. We can assist in the organisation of your very own ‘Ledger Nano S’ hardware wallet for AU$139.00 once you become a client.

What Is A Web Wallet?

These are the easiest wallets to use and the most convenient. Web Wallets may also be referred to as “Browser-based wallets” or “eWallets”.  This method is generally the easiest way to obtain a cryptocurrency wallet. However, you need to choose your web wallet service provider with care as they host and hold your cryptocurrency. Most websites will allow for 2-factor authentication through Google, text message, or Authy. This adds a great layer of protection.

Since software wallets are connected to the internet you can spend your cryptocurrency at any time. There is however, a downside to this. Digital currency exchange websites are sometimes hacked and shut down, resulting in potential loss of cryptocurrency. We, therefore, do not recommend software wallets for large tranches of cryptocurrency.

What Is A Software Wallet?

Software wallets are installed on your computer and present as an Application. Like a hardware wallet, they give you complete control. You are responsible for backups and protecting your cryptocurrency.

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What Is A Hardware Wallet?

A “hardware wallet” stores cryptocurrency on an offline external hardware device just like a backup drive, and therefore cannot be hacked. While it is more expensive than most other wallets, It can be a great investment. You are in control of your cryptocurrency investment – you own the device. The challenge, however, is in choosing the right device and “activating” it correctly. It requires a degree of technical expertise. Experienced clients supply their own hardware wallet storage, but as a new investor, we can assist you in setting up your new hardware wallet. Whatever your level of knowledge, Crypto Space Australia can assist you.

A Caution About Wallets

Wallets can store your entire holdings of cryptocurrency. If your wallet is compromised or lost, there is generally no recourse. We recommend you choose a wallet and wallet provider that suits your needs.

 

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