What is a crypto wallet？

Wanna start your NFT collection, but have no idea where to begin? First of all, you need a crypto wallet, which will help store your payment method and new NFT. Without NFT, you can’t transact on Coinstore NFT Market Place. The crypto wallet is essential for you to acquire NFTs.

What is a Crypto Wallet?

A crypto wallet is like your purse or pocket wallet, but instead of cash and credit cards, it stores proof of digital assets such as cryptocurrency and Non-Fungible Tokens (NFTs). A crypto wallet also allows you to send and receive your NFT as well as websites integrated with blockchain-- usually called decentralized applications (or abbreviated as Dapp).

Now you’ve mastered the core concept of a crypto wallet. Let’s discuss the two most commonly seen wallet types.

Software wallets

Software wallets are like your pocket wallets, convenient yet not suitable for storing large amounts of cash.  Sometimes they’re called “hot” wallets because software wallets store your private key on devices connected to the internet such as your mobile phone or computer, which makes them more essentially vulnerable. Although they are generally user-friendly, they are more suitable for transactions and interactions with Dapp. 

Installing a browser extension on your computer or an application on your mobile device is the easiest way to go. It’s as simple as visiting the app store or websites of wallet providers. It’ll take you several minutes to set wallets. Popular examples of software wallets include MetaMask and Rainbow.

Software wallets are quite good for beginners because they are:

Easy to install: it only takes a moment to import an existing wallet address and private key or to create a new wallet.

Allowing multiple instances: via your seed phrase, you can possess the same wallet on many different devices at the same time.

However, they have one main drawback:

Key storage: Because your wallet exists as software, your private key is stored on

your device. This means that anyone who has access to your device (in person or

remote) can access your private key.

Even though they are quite easy to operate and convenient, software wallets need a higher level of operational security.

Hardware Wallet

Hardware wallets act as safe deposit boxes for your cryptocurrency and NFT. These physical devices, usually known as “cold” wallets, are specifically designed to ensure the safety of your digital assets. Hardware wallets create and store your private key on devices and can keep offline until you want to move your objects.

There are different types of crypto wallets. Ledger and TreZor, being one of the longest in the market can support multiple cryptocurrencies and remain as industry benchmarks. No matter which type you choose, you would want to buy a hardware wallet directly from the website of a generator to ensure you get a device that’s not tampered with.

To set and use hardware wallets, normally you would insert a USB into your computer and follow the instructions of the generator.

This physical connection is the strength of hardware wallets.

Physical security: Because your private key is only stored in your hardware wallet, only people who physically hold the hardware wallet can send transactions from the hardware wallet address. However, this advantage comes at a cost.

Hardware wallets need to be plugged in: If you leave your hardware wallet at home or misplace it, you can’t sign any transaction. If it’s forever stolen, damaged, or destroyed, you may need a seed phrase to reset the wallet.  

Connectivity problems are readily found: Not all hardware wallets can function with other devices. Hardware wallets are susceptible to connectivity errors. Some hardware wallets need a “bridge” installed in the device it’s plugged in before signing transactions on the blockchain.

In summary, the main advantage of hardware wallets is, unlike software wallets, not

susceptible to attacks from malware and viruses because the private key has never

been duplicated to the device the wallet is plugged in.

Which type of wallet should I use?

To enhance security, please try using software and hardware wallets at the same time.

Many users store most of their cryptocurrencies and highly valued NFTs in a hardware wallet, calling it a “vault” wallet. Given this situation, they send limited consumption cryptocurrencies (like ETT) for small purchases and transaction costs. This method allows you to maintain the convenience of software wallets while utilizing the security strength of hardware wallets.