Expert Guide to Safely Storing Crypto Assets
You keep your valuables locked in a safe. Your money is secured in the bank. Your credit cards are in your wallet. But how do you protect something as intangible as cryptocurrency? What follows is an expert guide to safely storing crypto assets.
Virtual Wallets
Digital banking has solidified its place as reliable as any brick-and-mortar option. Virtual wallets are becoming a norm too. They are excellent instruments for both obtaining and storing your cryptocurrencies.
Wallets vary and should be utilized based on varying currencies. Here are a few things to look out for when choosing a virtual wallet.
Fees
Fees will vary based on the cryptocurrency and the wallet where you store the asset. As participants in the blockchain increases, the transaction will take more time to confirm and fees will increase.
Exchange Wallets
Exchange wallets leave you vulnerable to virtual threats such as the NiceHash
hacking. These cybercrime are universal across the web though and all parties
are doing their best to tighten security protocols. OKX is a cryptocurrency exchange that offers a best in class virtual wallet. They have robust security
measures to help you keep your assets safe while trading on the exchange.
Withdrawal Fees
Bitcoin exchanges are growing constantly, and its most difficult aspect is knowing where to get your currency. Most investors compare bitcoin exchanges based on exchange rates. This leads to buying the least expensive option.
As sound as that may seem, exchange rates are not the end-all of the transaction. You need to consider the total funds you’d spend compared to the total amount of bitcoins received.
You want to calculate the transaction fees. There may be multiple fees to take into account.
Transaction Fees
Taken by the platform or broker, this is a mandatory service fee. It can be as little as 0.2% or as high as 3%.
Withdrawal & Deposit Fees
The riskier the payment method, the higher the fee.
Payment Processor Deposit Fees
Payment processors, independent of brokers and platforms, may charge a fee. Use of a credit card could also be a charge.
Currency Conversion Fees
You can easily avoid this fee by trying to deposit currencies accepted by your exchange.
Pros and Cons of Virtual Wallets
Pros
- This is a simple way to make crypto trades without personal engagement.
- Considering the volatility of currencies, this is a great way to trade. It allows the maximizing of profits by exchanging various currencies through walls and exchange platforms.
- Quickly trade of dollars for bitcoins and vice versa.
Cons
- There’s always the possibility of equipment malfunction which will lead to costly recovery time.
- Potential security risk as private keys are stored on the web.
- If exchange wallet gets hacked there’s no authority to repay the loss.
- There’s risk of fraud on exchange’s behalf.
Physical Coins
Services have started offering physical bitcoin. There may be a slight premium to pay over the bitcoin value to cover cost of manufacture and shipment of the coin. The coin will have a tamper-proof sticker that confirms the predetermined asset’s worth.
Conclusion
The truth is risks come with any investment. And solutions are making storing crypto safe. But don’t neglect responsible due diligence before you choose any storing platform.
