What is the conventional image of a wallet for you? The thing to hold your currency, right? The general parlance meaning does not, however, apply to crypto wallets. A Crypto wallet does not store your cryptocurrency because it can’t be stored but transferred. A cryptocurrency wallet has no physical or digital currency. It has coded information to use cryptocurrency. It might be hard to understand but don’t worry! We will provide a lucid explanation of it.
How does it work?
Let’s suppose you want to create a crypto wallet for yourself to transfer Bitcoin to your friend’s wallet. Now, the first step is to take a crypto wallet program, let’s take a desktop wallet so the program will generate multiple keys like a private key public key, and many BTC addresses. For the moment you have to choose one of each. Eventually, the program will both of these, private and public keys to make a unique BTC address which serves as a location to send the cryptocurrency, it is like your UPI id, which you give people to receive money in your account. On the other hand, a public key is a key that you give to the receiver to receive the transaction and a private key is a sort of password which is not meant to be shared with others and is used to confirm your authenticity and prove that you are the owner of the transaction made. So, when a transaction is made from one wallet to another no currency is shared rather a unique stamp or transaction details is mentioned on both ends.
Types of Wallets
There are two types of cryptocurrency wallets based on the private key: Hot wallets which are like our physical wallet or any software-based digital wallet. While cold wallets are like vaults or safe storage similar to banks where we keep our valuables, they could be stored in hardware like USB or written on paper.
Is it necessary to have a cryptocurrency wallet in Ibinex?
Ibinex prioritizes the safety of their customer’s privacy and their cryptocurrencies. Unlike other exchange programs, Ibinex offers a Cold storage system for 95% of the deposits. You can either transfer your coins to your private wallet or store them in your Ibinex account. These cold storages are geographically distributed and air-gapped. This means your private and public keys are offline stored, out of the reach of any hacker or scammer. Undoubtedly cold storage is the gold standard to store your digital valuable data.
However, besides trading and spending, people like to hold their crypto assets hoping one day value would go high. To hold your cryptocurrency for long-time cold storage is a better option considering safety which is permeable on software-based storage systems. No worries, Ibinex got your back you can either transfer your bitcoins to our Ibinex account or transfer them to your private wallet. Ibinex ensures your asset’s safety at all costs.