Set up a cryptocurrency wallet
A cryptocurrency wallet is where you can keep your cryptocurrency securely. The most popular cryptocurrency wallets are hosted wallets, non-custodial wallets, and hardware wallets.
Which one is right for you depends on what you really want in doing with your cryptocurrency and the safety of the net you want to have.
How to set up a wallet:
- Download a wallet app.
- Create your account.
- Be sure to write down your private key. It’s presented as a random 12-word phrase. Keep it in a secure location. If you lose or forget this 12-word phrase you won’t be able to access your cryptocurrency .
- Transfer cryptocurrency to your wallet.
A hardware wallet is a physical device that stores the private keys to cryptocurrency offline. It is about the size of a thumb drive. It is not popular because of their increased complexity and cost, but they do have some benefits — they can keep your cryptocurrency secure even if your computer is hacked. However, this advanced security makes them inconvenient to use compared to a software wallet and they can cost upwards of $100 to buy.
How to set up a hardware wallet:
- Buy the hardware.
- Install the software. Each brand has their own software that’s needed to set up your wallet. Download the software from the official company website and follow the instructions to create your wallet.
- Transfer cryptocurrency to your wallet. Similar to a non-custodial wallet, a hardware wallet typically doesn’t allow you to buy cryptocurrency using traditional currencies, so you’ll need to transfer cryptocurrency to your wallet.
Just as there are many ways to store cash (in a bank account, in a safe, under the bed), there are many ways to store cryptocurrency . You can keep things simple with a hosted wallet, have full control of your cryptocurrency with a non-custodial wallet, take extra precautions with a hardware wallet, or even have multiple types of wallets — with cryptocurrency the choice is yours.