One of the most important tools to manage your digital assets is a cryptocurrency wallet. It’s an online platform that manages your digital currencies. All transactions are still stored and recorded through a blockchain. Some cryptocurrencies have their official wallet that only supports their own digital money. Although, most wallets support more than one currency.
Crypto wallets in New Zealand come as a hardware or software wallet, with features ranging from offline storage, built-in swap exchange, and mobile or web availability. Different digital currencies have unique address types, which can send coins to other addresses. For example, a Bitcoin wallet address can only send or receive Bitcoin.
What is a cryptocurrency wallet and how does it work? What are the factors that you need to consider to choose the right crypto wallet? Moreover, what are the best cryptocurrencies in New Zealand? Read on this ultimate guide to know more.
A cryptocurrency wallet is a digital tool that stores, sends, and receives cryptocurrencies. Instead of holding coins or paper bills like a physical wallet, it holds private and public keys. These are secure digital codes, which your wallet uses to gain access to the blockchain. You can view your balance, send, or receive cryptocurrencies through these keys.
The nearest real-world equivalent to a crypto wallet is a bank or an ATM. You can think of a public key like your bank account. Once you go to the bank, you can gain access to your account and — in extension — your funds. Similarly, you can send crypto funds from your wallet once you use the public keys.
Just like a bank or an ATM that requires you to verify your identity through a PIN code, complete name, or permanent address, cryptocurrency wallets also require you to enter a secure digital code. This is a series of codes or numbers, called private keys. Unless you give out these details, your crypto funds in your crypto wallet remain secure and private.
A public key is a long sequence of codes, letters, and numbers in your wallet address. Its main function is to send cryptos to other people’s wallets. On the other hand, a private key gives you access to the funds in your wallet. As the owner of the funds, you can control the funds using private keys. Although, some crypto wallets don’t give you full access to these keys.
While you can send crypto funds using a public key, the same can’t be used to receive them. If you’re the receiver of the funds, you need a private key to prove that you are the owner of the wallet. You need to “unlock” them to gain full access to the funds sent to you. These keys are also referred to as addresses.
The public key can be shared with anyone, just like a bank account. This isn’t a secret code as it’s used to send money to your account. This is a common practice among online content creators and charities for donation. As mentioned, it’s very important to keep your private key confidential as it’s the primary way to prove that you’re the account holder.
Generally, cryptocurrency wallets simply hold your funds. They’re not used to trade, exchange, or grow your investments. Depending on your wallet, you can also purchase basic cryptocurrencies including Bitcoin and Ethereum. There are also different types of wallets with varying ease of use, convenience, and security.
While there’s a wide variety of cryptocurrency wallets, these can be usually divided into two categories. These terms are a “hot” and a “cold wallet.
Mobile or desktop wallets are apps that you download on your smartphones, tablets, PCs, or laptops. It’s used mainly for quick and easy payments while on the go. This is ideal for New Zealanders who are just starting their crypto investments, as they’re safe and easy to use.
Web wallets work similarly to a mobile or desktop wallet. Instead of an app, it’s a website-based digital wallet that you can access through a browser interface. You don’t have to install or download anything to get started with this type of wallet.
Not all crypto wallets are digital. There are also hardware wallets that work similarly to a ledger. It’s a secured physical wallet that stores your crypto keys remotely. It’s a bit harder to use, and it’s only recommended if you’re keeping your large amount of cryptos in the long run.
A paper wallet is the most traditional form of cryptocurrency wallet. It indicates the two core components that make your wallet: a public and a private key. However, it’s crucial to keep them in a safe place, as they can be misplaced easily.
It depends! Of course, beginners and serious investors have different needs and knowledge about cryptocurrency. Like a physical wallet, you should only store enough money in your crypto wallet. If you have more funds than you’re willing to lose, you should either take them out or transfer them to your cryptocurrency exchange to grow.
Most cryptocurrency wallets have three functions: sending, receiving, and holding funds. As a precaution, make sure to keep your wallet secure before doing any transactions. Activate two-factor authentication and keep your login credentials updated. Some wallets may also require you to install a secondary layer of security application.
To send funds from your account to other people’s crypto wallet, you need the receiver’s wallet address or their public key. This is what you’ll enter to complete the transaction. A public key can be identified and given in three different ways: a combination of numbers and letters, a QR code (useful for digital hot wallets), or a clickable link (redirects to your wallet instantly).
The process varies depending on the type of wallet you have. Hardware wallets may require you to connect their wallet and manually verify the transaction through the device.
The process of receiving crypto funds is less complicated than sending them. Although, this may still vary depending on the wallet. It also depends on the public key that you’ll give the sender: a fixed public key, a new public key for every transaction, or a combination of the two. Either way, this should be redirected to your wallet.
Holding crypto funds in your wallet has the easiest process. You simply have to keep them secured at all times, and that’s about it. Of course, you should also check the balance from time to time, so you can guarantee that it’s not subject to hacking. The best part is, some crypto wallets allow you to “stake,” which will earn interest as long as you hold on to your funds.
It always depends. As a rule of thumb, you should choose a cryptocurrency wallet with a simple interface and guaranteed support from the provider. Security breaches from crypto wallets can turn into huge financial damage. Just last March, USD5.7 million was compromised after Roll was attacked by hackers.
Check out the best cryptocurrency wallets in New Zealand per category. Keep in mind that it may still vary according to your needs and level of knowledge about crypto.
Ledger Nano S is one of the most popular cryptocurrency wallets for Bitcoin. It looks like a flash drive that you need to set up with a four-digit PIN code. After three incorrect attempts, the wallet wipes itself, so it’s very important to remember your PIN. Aside from BTC, it supports Bitcoin Cash (BCH), Ethereum (ETH), ERC20 tokens, and other more expensive cryptos.
Being a hardware cryptocurrency wallet, it has offline storage. It’s regarded as one of the most secure crypto wallets as it back-ups your accounts on a recovery sheet. However, it’s not free. You need to pay at least EUR79. As it’s a popular wallet, there’s a long queue of orders, so you may have to wait before getting your hands on it.
If you don’t know much about digital money, Exodus is the best choice for you! It’s a desktop and mobile cryptocurrency wallet, available on Windows, Mac, Linux, iOS, and Android. It has a straightforward interface with support for more than 25 cryptocurrencies, including Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Dash.
What’s more, you can easily exchange your crypto assets using your ShapeShift account! Fees may apply when you exchange cryptos or send funds to your wallet. It’s updated every two weeks, so you can trust to always get the latest and best features. Although, some investors may not like that it’s not fully open-source.
For Android users, Coinomi is the best cryptocurrency wallet for a wide array of coins. It’s designed to store multiple cryptos, with its intuitive interface and privacy features. Most of its features are free to use, including a built-in exchange for faster trading and a secure storage platform with strong encryption technology.
The crypto wallet places a big emphasis on privacy and user control. This makes for easy asset trading, thanks to its direct integrated currency exchange within the wallet. Within just a few clicks, you can set up a wallet and choose your preferred language including English, Russian, and Chinese. This way, different peoples can easily understand their crypto wallet.
Mycelium is a top cryptocurrency wallet for iOS, thanks to its security authentication features like HD (Hierarchical Deterministic), Bit ID (open protocol), “Watch Only” accounts and single address accounts. Plus, it’s an open-source software programme that creates backups and support for an offline hardware wallet.
Aside from being a popular choice among iOS users, it’s also available on Android. The biggest caveat is, it doesn’t have a web or desktop interface. You can’t do cross-platform cryptocurrency investing. What’s more, it’s not the easiest interface to use. Beginners may have a hard time navigating through the app.
It’s up to your needs. Some New Zealanders want to invest in cryptos for the long term, making more stable crypto like Bitcoin and Ethereum a better choice. On the other hand, others only like them to grow temporarily, making a fast-growing crypto or altcoin a better choice. Nonetheless, make sure you have the right cryptocurrency wallet to manage your digital assets. The right tools can make or break your investments, so make sure to get one that matches your needs and knowledge about crypto.
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