Storing Crypto

Storing Crypto

By konjo | konjotech | 10 Jun 2021


Storing Crypto

 


 

 

This article covers the different methods of storing Crypto and the different advantages and disadvantages of each. It also explains the difference between custodial and non-custodial. This is by no means a comprehensive list of all available options, but this can be used as a reference when conducting research for crypto storage options. Please conduct your own due diligence before choosing a crypto wallet. Now, let's dive in at take a look into the crypto storage ecosystem.

 

 

Methods for storing cryptocurrency

 

  • Custodial Exchanges, Banks, Apps, Platforms, and Wallets
  • Non-Custodial Hot Wallets
  • Non-Custodial Cold Wallets

 

 

What is the difference between Custodial and Non-Custodial?

 

 

Custodial means that a centralized entity controls the private keys that access the crypto. 

 

For instance, Coinbase is a custodian for all crypto within their exchange.  When you purchase crypto through Coinbase, you only purchase a claim on that specific amount of crypto on that exchange.  The custodial financial responsibility is placed on the exchange or institution.   

 

 

Non-Custodial means that when you setup a wallet or account, you have full control of the private keys and thus sole access to the crypto. 

 

The owner alone has access to that specific wallet and the crypto contained within that wallet.  The owner of the private keys has a higher level of financial responsibility for that crypto wallet.  For instance, if you lose your password, PIN, or seed phrase(s), you lose access to the crypto.  

 

 

Custodial Exchanges, Banks, Wallets, Apps, and Other Platforms.

 

  • Storing crypto in exchanges is not as secure, lower security, but less personal responsibility.
  • Various crypto platforms including exchanges and banks have been hacked and crypto has been stolen.
  • Phrase to remember – “Not your keys, not your crypto.”

 

For more information about crypto hacks: Crypto Exchange Hacks

 

 

 

There are some benefits to keeping

small amounts in crypto exchanges or banks.

 

  • Interest bearing crypto savings accounts
  • Staking for rewards
  • Providing Liquidity for rewards
  • Crypto Loans
  • Day trading

 

 

Use caution when storing more than $5,000-10,000 worth of crypto in custodial platforms. Please do you own research and due diligence when investing in crypto exchanges, banks, apps, and other platforms.  Please understand the risks involved before investing in crypto.

   

 

 

Non-Custodial Hot Wallets

 

  • Can connect to the internet easily
  • Phone apps
  • Desktop applications
  • Internet Browser extensions
  • Medium level of security           

 

 

 

This image has an empty alt attribute; its file name is wallet-2-1.png

 

Non-Custodial Hot Wallet Examples  

 


     

Trust Wallet

https://trustwallet.com/

  • Mobile App
  • Owned by Binance (One of the largest crypto exchanges in the world)
  • Can store 160k+ different crypto assets
  • Including Tokens, NTF’s, ERC20, etc.

               

 

 

 

MetaMask

https://metamask.io/

  • Internet Browser Extension and mobile app
  • Can be used to purchase NFT’s, conduct cryptocurrency swaps on Uniswap, PancakeSwap, providing liquidity, yield farming, DeFi, etc.
  • Used for many different Ethereum ecosystem transactions

           

 

 

Exodus

https://www.exodus.com/

  • Mobile & Desktop App
  • Compatible with Trezor non-custodial cold wallet

 

 

 


 

 

 

Non-Custodial Cold Wallets

 

 

  • Very secure, offline storage, very difficult to hack via the internet.
  • Requires a high level of personal financial responsibility.
  • If you lose your password, PIN, or seed phrase (private key), you lose access to your crypto.

           

 

 

 

This image has an empty alt attribute; its file name is usb-1-1.png

 

Non-Custodial Cold Wallet Examples

 

 

Ledger Nano S (USB)

https://shop.ledger.com/products/ledger-nano-s

  • Highly rated, highly secure, very popular
  • USB support
  • Supports many different crypto assets

 

 

 

 

 

Trezor One (USB)

https://shop.trezor.io/product/trezor-one-white

  • Supports many different crypto assets
  • 24 seed word private key password
  • Also very secure, highly rated, and reliable

         

 

 

SafePal (Device)

https://safepal.io/

  • Lowest cost option for cold wallets
  • Very light, the size of a credit card
  • LCD screen readout
  • USB connection not required to check crypto balances

 

 


 

 

 

Final Thoughts

 

 

 

“Not your keys, not your crypto.”

 

If you do not physically have the private keys to your crypto wallet in your possession, you have purchased only a claim on crypto owned by a custodian.

 

 

Use caution when storing more than $5,000-10,000 worth of crypto in exchanges or banks.

 

Consider keeping large amounts of crypto under your control where only you have the private keys for access. Please do you own research and due diligence when investing in crypto exchanges, banks, apps, and other platforms.  Please understand the risks involved before investing in crypto.

 

 

Non-Custodial hot wallets are more secure than Custodial platforms. They can easily connect to the internet to transact crypto.

 

Each hot wallet has different features and varying levels of crypto support, please do your own research when considering a purchase or investment.

 

 

Non-custodial cold wallets are most secure and the private keys are primarily stored offline unless accessing crypto.

 

Cold wallets are very secure, but protect and safeguard your private keys! If you lose your private keys, you lose your crypto. Paper wallets, which are technically cold wallets, are the most secure method for storing crypto assets. An article detailing paper wallets is forthcoming.

 

 

 

-Keep it Konjo


Credits

Icons made by Freepik, Eucalyp, Dighital, itim2101, xnimrodx, surang, mangsaabguru, monkik from www.flaticon.com

 

Trust Wallet – Trust Wallet

MetaMask – MetaMask

Exodus – Exodus

Ledger – Ledger

Trezor – Trezor

SafePal – SafePal    

 

***Disclaimer***

 

The content provided on this website does not constitute investment advice, financial advice, or trading advice. Please conduct your own due diligence and research before making any investments.  This article is covers some crypto storage examples.  It is not a comprehensive list or specific purchasing advice for any specific wallet, company, or service aforementioned.  Please conduct your own research to determine the best storage solutions to meet your specific requirements. Please understand the risks involved before investing in crypto.

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konjo
konjo

ቆንጆ - "Beauty"  |  根性 - "Perseverance" | 康宙 - "Universal Health"  |  कोह्जो - "Discovery"


konjotech
konjotech

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