When trading cryptocurrencies you have to take into account a very important factor that is usually not so critical in other investments: security. Unfortunately, the world of cryptos is a constant tale of theft, hacks, scams and losses in the millions. To reduce as much as possible the possibility of losing cryptocurrencies to a fiend you can use a device called a physical wallet, hard wallet or cold wallet, which we tell you all about in today’s video:
It is important to understand that whatever method is used to store cryptos (physical wallet, digital wallet or an exchange) none of them actually store cryptocurrencies. Cryptocurrencies are on the blockchain, the open blockchain network that can be accessed by any user. This means that cryptos cannot be downloaded and stored like a photo.
Physical wallets are by far the safest method of keeping our cryptocurrencies safe and secure
Instead, what is protected with these methods, are the private keys to access these cryptos. If we use an exchange to store our cryptos, the private keys are not in our computer, but in theirs. If we use a digital wallet, it is also possible that the keys are stored on their servers. On the other hand, with a physical wallet, the keys to access the cryptocurrencies are inside the device, so you need to have physical possession of them to access them This greatly decreases the risk of losing everything in cyber attacks mass attacks or hacks on individuals, which happens all too often.
Physical wallets come in all shapes and sizes, as there are dozens of brands that manufacture them. One of the most famous is Ledger, whose Nano S we use in the video, but there are many models on the market that are just as valid, so it is necessary that you research well which one is best suited to your needs before purchasing one.