More on Bitcoin Wallets...
In the last blog post I told you guys about the different types of wallets which you can use to store your cryptocurrency. Today I am going to explain to you that how these wallets function.Remember: I will be Writing the Wallets in Ascending Order of Security i.e starting from the least secure to the most secure.
These wallets are actually made by different website where people can store their crypto-currencies.In this wallet the website holds your sending and receiving address in its database.I would also like to tell you that this type of Online Wallets are also made on exchange website for cryptocurrency trading.Most People (including Me ! ) will not recommend to use Online wallets for saving your cryptocurrency as these wallets are not trustable because all your keys,which have you crypto assets, are stored in the website's database and in many instances these databases servers get hacked and in a single instance all your coins are vanished from your account.Examples of few Online Wallets are Coinbase, Bittrex, btc.com etc etc
Offline Wallets :
Offline wallets are the types of wallets which are installed and used on your desktop computer. These wallets are also available in the from of apps and can be installed on your smartphones.These wallets are more safer in terms of security as the keys of these wallets are in your hands and not in any server or database but still their is a risk that the computer might have a problem or a virus/hackers infects your computer/smartphone and eventually all your data is lost and the coin can never be used ! In this case I will recommend either to store the wallets keys in two or three backup hard-disks or by making a wallet on a computer which has never been connected and will never connect to the internet.The Examples of a Few Popular Ones are Exodus, Electrum etc
These wallets are made in the form of a handheld portable device which has the capability to store the Keys of your coins.These wallets are available in the market and are highly secure in storing your data but still their is a chance that the device might get a fault and stops working causing you to loose your money.The Examples are Trezor, Nano Ledger S, KeepKey.
Paper wallets are the wallets which are printed and will be stored safely ina safe place.These wallets are free of cost and are printed on plain paper.The wallet cotains your receiving and sending addresses which you can see in the form of a QR-code.These wallets are highly safe as these are in the paper for and not present on the internet.Though their is still a chance that the ink on the paper may wear out hence its better to get multiple copies off the wallet and get them lalminated and store them in a safe place.