Should i move my crypto to a wallet
If you’ve been investing in cryptocurrencies, one of the most important questions is whether or not you should move your coins to a crypto wallet. This is because your wallet is a safe and convenient way to keep your crypto private keys, which are needed to access the blockchain.
A crypto wallet can be a hardware device, a software application or an online service. There are many different types of wallets, and the best one for you depends on what you plan to do with your coins.
Non-Custodial Wallets
A non-custodial wallet is an offline crypto wallet that stores your private keys in a physical device. It’s considered the safest type of wallet and is a great place to store long-term crypto for peace of mind.
Hosted Wallets
A hosted wallet is a digital wallet that lets you buy, sell, send and receive your cryptocurrency through the internet. These wallets are the easiest to use and are often recommended for new users.
However, they are not as secure as a non-custodial wallet. You need to share personal information to create a hosted wallet, and you risk losing your crypto if an exchange gets hacked.
Cold Storage Wallets
If you’re looking to avoid security risks, consider moving your crypto to a cold wallet. Cold wallets are offline devices like a hard drive, USB drive or memory stick that store your private keys and don’t connect to the internet.
You should also use seed phrases, which are a series of randomly generated words that act as a key recovery tool if you lose your storage devices or access to your crypto.
You should never move your coins between cold and hot wallets, as this is considered a trade and may result in taxable transactions. This is especially true for cryptos like ether (ETH), solana (SOL) and bitcoin (BTC) that are traded for other cryptocurrency coins and tokens.