Updated: Feb 5
In my previous blog, I wrote about the hacks on different Bitcoin exchanges and that on many internet sites you're advised to store your bitcoin in a wallet rather than an exchange... but why should a wallet be any more secure than exchanges? It's still an online service.
First thing you must keep in mind before getting your first set of bitcoins is a place to store them. This will not be your typical bank account, nor your back pocket or purse. Even though this is a digital currency, it must be stored in a safe place just as your regular cash. I must emphasize safe place because, in previous blogs, I also mentioned that bitcoins don’t have a refund nor a third party that is held accountable if your coins get lost... Therefore, finding a secure place must be a top priority when it comes to owing a cryptocurrency.
It's important to take time and investigate about where you will store your currency; and yes, in this Bitcoin world is all very much, “Do it yourself." Whether it's finding out about new apps, exchanges, wallets, among others, you must read, investigate and trust a service because these services don’t involve a tied entity backing them up.
There are many types of Bitcoin wallets existing today that are offered online. There are several types of wallets you can use; for example, hardware wallets such as Ledger Nano S and Trezor. These physical devices cost money, so I recommend free software apps such as Jaxx. Bitcoin wallets are software programs that facilitate transactions (sending and receiving). A wallet creates a key that can be used to transfer bitcoins to another person. According to Blockgeeks.com, “Wallets are secure to varying degrees. The level of security depends on the type of wallet you use (desktop, mobile, online, paper, hardware) and the service provider. A web server is an intrinsically riskier environment to keep your currency compared to offline. Online wallets can expose users to possible vulnerabilities in the wallet platform which can be exploited by hackers to steal your funds. Offline wallets, on the other hand, cannot be hacked because they simply aren’t connected to an online network and don’t rely on a third party for security." Coindesk assures that “what makes paper wallets secure is that they are never trusted to a third party. As long as the paper wallet is secure, your holdings are secure." However, it’s not the easiest way to secure and use your bitcoins.
One of the software that Davinci Codes is developing is a digital wallet named Pandora's Wallet, Davinci Codes knows that leaving money on currency exchanges may be a high risk because they are the ones holding your private key. This is also combined with the fact that most wallets services don’t work with many different types of cryptocurrencies. Thus, Pandora’s Wallet is being develop to secure your coins and being able to access many different currencies in only one digital wallet. Another one of its features is that it will also offer a system that can connect directly and automatically with exchanges, all this to make every transaction much easier. According to Sieger Bokschoten, a junior development programmer at Davinci Codes, “Our team maintains the coin servers bitcoin, lightcoin, among others, so that you don't have to worry about things like downloading blockchains, dealing with compiling errors, or problems connecting to the network."
Whether you choose Davinci Codes' Pandora’s Wallet, or any other, just be safe by investigating as much as you can before you trust your crypto on any software.
Hope you enjoyed it! Feel free to comment.