Most people get cryptocurrencies from an exchange for the first time. As long as they register an account and complete identity verification, they can withdraw, deposit and trade cryptocurrencies at any time. Functionally, it is simply a one-stop wallet. , then why go out of your way to get an extra wallet?
Although it is more convenient to host the currency on the exchange, there are several important reasons why we must use an independent wallet:
The fourth point is easily overlooked by many people but is very important. Especially after the 2022 incident in which FTX exchange misappropriated customer assets and led to its collapse, people began to realize that it was not safe to store cryptocurrencies in exchanges (custodial wallets). Once the exchange goes bankrupt, the assets cannot be recovered. Therefore, unless you need to make a transaction, it is safer and more reliable to keep your coins in a wallet you control (a non-custodial wallet).
Non-custodial cryptocurrency wallets are mainly divided into two types: software wallets (hot wallets) and hardware wallets (cold wallets). Software wallets are suitable for daily transactions, while hardware wallets are more suitable for long-term currency hoarding. This article will focus on hot wallets and select currently popular wallets for discussion in order to choose the most appropriate wallet in different application scenarios.
The basic functions of the wallet include sending, receiving cryptocurrency and displaying the number of coins. When choosing a wallet, you should pay attention to additional features such as transaction tracking and multi-currency support.
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