How to Set Up and Use a Cryptocurrency Wallet for Microtransactions
Do you dream of becoming a crypto billionaire like Sam Bankman-Fried?
Whether you dream of growing a fortune or simply want to enjoy spending your crypto, you’ll need a cryptocurrency wallet. There are a few different types of cryptocurrency wallets, such as hosted wallets and self custody options.
How can you decide what crypto wallet is right for you? It all comes down to determining your needs and identifying safety nets. To help you decide, we’ve created this short guide all about choosing and setting up digital wallets.
Keep reading as we uncover how to set up the right type of wallet for spending crypto.
Hosted Wallet for Microtransactions
You want to easily store, send, and accept cryptocurrency, right? In that case, make things easy on yourself by getting a digital account that’s hosted by a secure third-party financial institution.
A hosted wallet is one of the most secure crypto wallets you can opt for. You’ll basically be transferring all of your security liability to the service provider. Instead of worrying about cyber vulnerabilities, you’ll be able to focus on how you want to use your funds.
The third-party financial institution will be responsible for averting any threat that might get in your way. A couple of the top vulnerabilities that crypto wallets face are hacking and negligence.
An example of negligence would be forgetting your crypto wallet password. If you’re using a centralized wallet, it’ll be up to you to stay on top of all of your login information. Whereas if you choose to use a hosted wallet, it’ll be like using a bank account.
The financial institution will be responsible for keeping all of your security details up to date. If you lose your password, you won’t have to worry about losing any of your cryptocurrency.
The only downside is that some hosted wallets have limited spending features. Make sure you use a host that will have all of the capabilities you’re interested in.
Setting up Your Hosted Wallet
Now, let’s dive into how to set up a hosted crypto wallet. First, you’ll need to choose a platform you can feel good about using. It should be a name-brand platform that you trust.
Security should be your top priority, with convenience being second. If the platform isn’t easy to navigate, you’ll have a hard time accessing your crypto when you need it the most.
We also suggest that you invest in a two-step authentication setup. Some websites will refer to the two-step process as a 2FA verification. By having more than one verification in place, you’ll be adding an extra layer of security.
Finally, ensure that the account fully complies with all of the latest government and financial regulations. After setting up your account, you can start buying crypto.
Many of the latest digital currency platforms will allow you to buy crypto with your credit card or bank account. If you already own crypto, you’ll be able to transfer it into your hosted wallet.
Self Custody Crypto Wallet
Do you want to be in complete control of your cryptocurrency? Then you’ll need a self-custody wallet.
Self custody wallets are a great way to keep your crypto safe while giving you complete freedom. You have all the software you need to safely store your digital currency. However, you can do a lot more than store crypto.
If all you care about is buying and selling crypto, you’ll probably want a hosted wallet. A self-custody wallet is for somebody well-versed in the world of cryptocurrency.
When using a self-custody wallet, you can take advantage of activities such as staking, borrowing, yield farming, lending, and more. If you’re ready to reach that next level with your investments, then a self-custody wallet might be the right choice.
A couple of things to keep in mind is that your self custody wallet has more responsibility. It’ll be up to you to provide all of the cybersecurity necessary, but sometimes that can be good.
When you’re in charge of the security features, you can customize them to your needs. Suppose the type of cryptocurrency you’re working with is vulnerable to a specific kind of attack. In that case, you can strategize your cyber defenses accordingly.
When you self-host, it’s also your responsibility to remember the password for your crypto wallet. If somebody else can uncover your private key, they’ll have full access to your digital profile. Be sure to store your passkey safely.
You’ll also want a plan in place should something happen to you. Set up a backup plan, and have someone you trust whom you can share the keyphrase with.
Matthew Mellon had $500 million in crypto when he passed away. He never shared his key phrase with family members, and now that digital currency is lost forever. To avoid losing your money, have a backup plan set in place with an attorney.
Finally, you won’t be able to buy any crypto with your non-custodial wallet. However, you can transfer digital currency into your wallet from other accounts. If you’re sure that a non-custodial wallet is a right choice, you’ll find that setting it up is very easy.
Setting up a Self Custody Wallet
To set up a self-custody wallet, you will need to download a dedicated wallet app. Once you have the app, you can create your account. You’re not going to need to share your personal information to create a non-custodial wallet. You won’t even need an email address.
After setting up your self-custody wallet, do a bit of exploring. Discover all of the features the platform has to offer, so you don’t miss out on any opportunities.
Set up a Cryptocurrency Wallet Today
Are you leaning towards getting a hosted wallet? It’s definitely the most secure crypto-storage option.
When you set up your hosted wallet, the account will require a lot of personal information. If you want to keep things private, we can help.
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