The 10 Biggest Myths About Cryptocurrencies - Part 4
Myth 4: Keeping cryptocurrencies is cumbersome and risky
An oft-voiced concern about Bitcoin and other digital currencies is that it is not physical money in the traditional sense - people lack the sense of having money in their hands and spending it. Instead, cash that you keep in your own wallet gives you the security of having money and having it freely available.
The way the money is stored thus plays a key role for its owner, especially with regard to availability and security. This is precisely where the criticism of many potential investors comes in, who lack exactly these elements of cryptocurrencies. Instead, the storage of cryptocurrencies are confusing, make unnecessary efforts and are also not very safe.
Now, one can not completely disagree with these arguments, which are presented primarily from the point of view of non-crypto-affinic people or newcomers. For someone who deals with the subject for the first time, the various storage options in virtual purses (so-called wallets) can quickly seem so confusing. You can lose track of where to keep your money now.
In any case, it is advisable to subsequently transfer the acquired cryptocurrencies to a wallet and not leave them at the stock exchange. This is the only way to get hold of your private key, which is necessary to gain access to the cryptocurrencies. A private key is generated at each new address. This must be kept very safe and secret, otherwise unauthorized persons can get access to the coins in the wallet.
When choosing wallets or wallets, it should be noted that there are several types of secure cryptocurrency storage. While an online wallet is available for free and - assuming Internet access - is available from anywhere, there is the situation that the keys are managed by external companies and the user can not check their own security. Desktop and mobile wallets solve this problem, but are bound both spatially and safety-related to the respective devices. In addition, mobile wallets do not function as a full-fledged client, as it would blow up the volume of a cell phone to charge the entire blockchain.
The most similar to a classic wallet is a hardware wallet that stores digital money separately and securely. The big disadvantage of this solution compared to the other, spatially bound wallets are the high initial costs of hardware wallets. However, storage on an offline device (cold storage) is generally considered more secure than storage on a device that is permanently or temporarily connected to the Internet (hot storage).
Basically, keeping and switching between different means is no more cumbersome than dealing with cash. In order to transfer money from his bank account into his wallet, it is necessary to visit an ATM. The transfer of money from the Hardware Wallet to his smartphone can be done by anyone, regardless of their location.
Therefore, as with so many other things, this myth can be said: Once you have seen through the system, the everyday challenge you are faced with is not as great.
If the flow of information in this article went too fast, you are welcome to read the various ways to store digital currency in detail in our tutorial.
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