With people constantly looking for way to grow their finances during this pandemic, there is no doubt that cryptocurrencies remain to be in demand. However, for someone who is just starting to explore this arena, you may need more reasons to convince yourself to give in.
At this point, some things may still remain unclear to you. What if you do start buying crypto coins? Where should you store them? What is a hardware wallet? Why is it said to be a safer option than a soft wallet? Let us guide you in answering these questions on this article.
In this part of the article, we will tell you the reasons why people go on and venture into the field of cryptocurrencies.
This is no brainer. The very reason why cryptocurrency has risen into popularity is because of its high return expectancy. It is fine if you do not want to put daily efforts in trading it. With a passive arrangement, strong cryptocurrencies have a potential to double in just a few years, if you are lucky, even less!
You can also be aggressive with it by using it into trades. Staking is an option, too. With cryptocurrencies, there are infinite ways to grow your investment.
Another reason why people bet to put their money in cryptocurrencies is that they are pretty much straightforward to sell, meaning, there is always a demand for it. You can turn them into flat currencies whenever you like.
To be clear, straightforward selling may only be true to coins that has a large user base and popularity such as Bitcoins and Ethereum. These coins are considered 2-in-1 product and currency. People always look for these to buy, while some who possess this use it to pay other goods. As long as you stick to the strong coins, you will not be having problems in converting your crypto investments to flat currencies whenever you like.
Save on Fees
Do you remember the feeling when you realize how banks just cost you large money by simply facilitating huge transactions? You can opt to not have that moment again. With the crypto technology, consumers have the option to extremely cut such third-party fees. To give you an idea how cost-efficient this is, transaction fees costing thousands of dollars can be cut into just cents!
To further prove this point, it is no wonder that even large reputable banks have entered the cryptocurrency world as customers. Some utilize this technology to save on their own expenses.
If you think the crypto technology has amazed you enough, here is to even level it up. With blockchain systems at the backbone of crypto technology, they are capable to extremely speed-up transaction periods, too. Imagine, the types of large transactions that will require a customer to wait for days-long verification period when done in standard banks, can now be completed within just minutes. What a way to save worry while waiting for the transaction to success!
Say you have decided to do venture in cryptocurrency investments. The next thing you should decide on is where to store it. What is a hardware wallet? Is there another option in storing your crypto coins?
The two major categories you have as options in storing your crypto investments are hardware and software wallets. It is recommended to divide your total crypto possession between these two types. What chunk of money should you wisely store in which? Let us answer this question with the information below.
What is a hardware wallet? Going to the bottom of this discussion, a hardware wallet, is a more secured way of storing your crypto assets. It requires you to have a hardware device to store your private keys and enable access to your investment. The major advantage of this wallet type is that it is that the key access does not need to be connected online all the time.
Hardware wallets are also called cold wallets, simply because they are preferred by someone looking to store their cold investments – those that they do not move as often because they do not use it for frequent transactions. Instead, investors wait for it to mature and gain long-term interest-like profits, or simply store it as emergency funding.
The drawback of using a hardware wallet is that this tangible device may be stolen, broken, or lost. As a precautionary measure, you should always take note of your seed words whenever they are available. These can enable you to recoup your crypto coins even any of the unfortunate incidents happen.
Another disadvantage is that hardware wallets are not free. They cost around 60 USD. However, if you think of its price as just a one-time payment you have to shell out for the added protection, then the cost sounds reasonable.
Now that you know what is a hardware wallet, let us go and discussing the other option – the software wallet. On the contrary, software wallets are digital wallets to store your crypto coins. With this tool, not only it can hold your assets, but it will also allow you to receive and send out coins to business and other traders.
Software wallets are always connected online. As a matter of fact, by using this, your public and private keys enabling your access are stored on the internet. This is the very reason why it is considered as a lesser safe option. Coins stored here are constantly prone to hackers and other cyber-attacks.
It is recommended that you only store crypt coins in software wallets that has high mobility. Meaning, you either use it to cover daily transactions – either paying for merchants and services or trading it on a daily basis. The other term for a software wallet is a hot wallet. They are meant to store hot coins that are constantly being used. Learn more about cryptocurrency wallets here!
There are many more reasons why people enter the cryptocurrency arena. Those mentioned are only just a few. Should you finally decide to buy cryptocurrencies, too, another subject to finalize is how would you like to store these assets.
From this article, you now know what a hardware wallet is, as well as its advantages over a software is one. Store your long-term investment coins here while put the chunk that you intend to move around on the latter one.