Cryptocurrencies and Non-fungible tokens (NFTs) have been all the rage for the past few years and everybody wants to have a piece of the pie. Despite the volatility associated with cryptos, people have been flocking in droves to hold these assets. The potential of astronomical returns based on a decentralized financial system has encouraged many to invest in cryptocurrencies. Despite the immense popularity of cryptos, the most important concern of crypto investors is the safety of their money. Companies are mindful of this aspect and are constantly working on building new safety features to alleviate these concerns. Protecting your financial assets with crypto wallets is a good way to secure your investment. With the addition of new features in these wallets, investors can be assured of their financial safety.
Table of Contents
What are cryptocurrencies?
A cryptocurrency is a digital currency that is not regulated by any central authority. It is exchanged in a decentralized financial system using blockchain technology which records every transaction in a digital ledger. Cryptocurrencies are a viable alternative to traditional paper currencies because these are not controlled by an all-powerful intermediary who dictates the terms of transactions.
Popular cryptocurrencies
Many cryptocurrencies have made an entrance ever since the launch of bitcoin in 2009. Some of the popular ones are:
- Bitcoin – Bitcoin was the first cryptocurrency to be launched by anonymous programmers. It is the most popular one as well. Investing in Bitcoin has made many people incredibly wealthy. At one point of time in November 2021, the worth of a bitcoin was US$ 69,000. No wonder then, people are still anxious to hold bitcoins.
- Ethereum – After Bitcoin, Ethereum is the second most popular cryptocurrency in the world. Built by Vitalik Buterin in 2013, Ethereum is a decentralized finance (DeFi) platform that offers a whole array of financial services.
- Solana – A relatively new entrant in the market, Solana has gained quite a following with its active trading volume. It operates in a type of mechanism that makes the network significantly faster as the nodes don’t have to connect with a block in such a system.
These digital currencies can be kept in crypto wallets.
What is an NFT?
NFTs are similar to cryptocurrencies as it operates within blockchain technology. An NFT is a unique asset that is assigned a token that distinguishes it from other tokens. Real-world items like art and photographs also come under the ambit of NFT. These can be traded for other currencies including cryptos and other NFTs. An NFT may be completely worthless or valued in millions of dollars.
Storage of crypto assets
With the growing usage of cryptocurrencies, hacking attempts to steal crypto assets have increased too. According to an estimate, about US$ 4 billion worth of crypto assets have been stolen in 2022. In this context, it is crucial to secure these digital currencies. Many companies are actively building a full-proof security system to protect the wealth of investors. Cold storage wallet crypto provides extensive security features which guarantee the protection of crypto assets. Here are some of the properties of the cold storage wallets which help in the comprehensive protection of the investors’ assets.
What are cold storage wallets?
A cold storage wallet is a hardware device that is not connected to the internet. These are operated offline and therefore carry almost no risk of theft attempts. The following are some of the properties of cold wallets that give them an edge over online wallets.
- Detailed Authentication
The cold wallet device usually has a dual authentication process where the user is asked for a password and a pin to access the account. This detail is to be preserved carefully so that no one can access the device without the user’s consent.
- Auto self-destruct
In case the device is stolen and there are multiple attempts to crack the code, the devices are programmed to self-destruct.
- Firmware update
The device can be updated to the latest version offline to get the updated security features.
- Multiple accounts
One can set up alternate accounts with an alternate password in the device if they are threatened.
Conclusion
The craze of cryptocurrencies has not subdued despite the controversies surrounding it. People are eager to invest their money in cryptos as these are widely considered to be rewarding assets. Cryptocurrencies are part of a decentralized financial system that involves the use of blockchain technology and eliminates the intermediaries like government or central banks. The assets are held safely in a wallet. Earlier there were only hot wallets or online wallets but with the development of new hardware technology, cold wallets or physical wallets have entered the market as well. Cold storage wallet crypto is a hardware device that protects your crypto and NFT assets from any malicious attempt like hacking or financial theft. These are much safer than hot wallets as the device is completely off-grid. The crypto assets are safe forever as the device is not connected online. Getting such a device promptly would be money well spent!
