Cryptocurrencies are becoming increasingly popular, and a growing need for reliable tools to store them comes with that. A cryptocurrency wallet is a must-have for any user who wants to manage their assets safely.
However, before creating a cryptocurrency wallet, it is important to understand what types of wallets exist, how to choose the right one, and how to ensure the protection of your funds. In this article, we will detail the process of creating a cryptocurrency wallet using Trust Wallet as an example and provide useful security tips.
Cryptocurrency Wallet: Basic Information
A cryptocurrency wallet is a tool that allows the user to store, send and receive cryptocurrencies. In fact, the wallet does not store the coins themselves but provides access to the blockchain through private and public keys.
A private key is a unique code that confirms ownership of funds. Losing this key means losing access to your assets. A public key is a wallet address that is shared with other users to receive transfers.
Cryptocurrency wallet functions:
- Cryptocurrency storage. A wallet allows you to securely store access keys to your assets.
- Transaction management. You can send, receive and sometimes even exchange cryptocurrencies.
- Asset protection. Modern wallets use encryption and other security features to prevent unauthorized access.
The primary role of a cryptocurrency wallet is to provide the user with an easy and secure way to interact with the blockchain. It is needed for both private and business purposes, such as accepting cryptocurrency payments.
Varieties of Cryptocurrency Wallets
Cryptocurrency wallets can be divided into two main types: hot and cold. They differ in how they connect to the Internet, the level of security, and the convenience of use.
Hot wallets
Hot wallets are permanently connected to the internet. They are convenient for regular use, for example, for trading or paying for goods and services.
- Mobile apps. Installed on a smartphone and allow you to have constant access to crypto assets, usually supporting a wide range of coins. An example is Trust Wallet.
- Desktop wallets. Installed on a computer, they often offer advanced functionality and integrations with exchanges. A popular desktop wallet is Exodus.
- Web wallets. Work as a browser extension, offer a number of tools for working with cryptocurrency. One such wallet is MetaMask.
Cold wallets
Cold wallets work offline, providing a high level of security. They are suitable for long-term storage of large sums of money.
- Hardware wallets. Desktop or mobile software stores private keys on the device, allowing you to do without a constant connection to the internet. Popular examples: Ledger, Trezor.
- Software wallets. These are cryptocurrency storage software that is used in the absence of an Internet connection.
- Paper wallets. The key in these wallets is represented by a QR code, which must be scanned with your device's camera. Funds transfers from such a vault are carried out using online resources.
We have prepared an article about the best cold cryptocurrency wallets.
How to Choose a Cryptocurrency Wallet? Main Criteria
There are so many wallets for cryptocurrency (not only varieties, but also specific models/services). To choose the right one it is important to consider the following aspects:
- Security. Storing funds should be convenient and safe. Therefore, it is important to choose a wallet that uses encryption, two-step authentication, and other security tools.
- Supported cryptocurrencies. If you plan to work specifically with this asset, you can create a Bitcoin wallet or find a storage that supports alternative coins, such as Ethereum, Litecoin or other available options.
- Integrations with various services. Many wallets not only store savings but also allow you to convert currencies through connected services and interact with decentralized applications.
- Usability. The wallet interface should be intuitive, so that even a beginner can understand the work.
- Backup. Many wallets offer to create an encrypted backup file, which may be needed in case of loss of access to the storage.
How to Get a Trust Wallet?
Trust Wallet is a mobile app and browser extension that supports multiple cryptocurrencies and provides a high level of security. To create a Trust Wallet, follow the steps below:
- Download the cryptocurrency wallet. Go to Google Play, Chrome Web Store or App Store, search for Trust Wallet and install the app.
- Launch the program. On the app's home screen, click on “Create a new wallet.” Set a password.
- Create a seed phrase. It is needed to restore access to the storage in case of its loss.
- The final step is to confirm the previously saved seed phrase. After this operation Trust Wallet will be created and it can be replenished with a financial transaction.
Recommendations for Protecting Funds
It is important for users not only to understand how to create a cryptocurrency wallet, but also to learn how to secure their assets. Access to them can be lost for various reasons, ranging from hacking to technical failure. To protect yourself from such troubles, you will have to:
- Keep your passphrase and private keys in a secure place.
- Enable two-factor authentication for accessing the wallet and making payments from it (confirmation by SMS or code to the mailbox).
- Use antivirus and antispyware software to prevent the installation of malicious programs (viruses, keyloggers).
- Do not surf suspicious resources and do not install unknown applications, pirated software, etc. on your PC or smartphone. Do not allow strangers to use your device.
- Also, the user should regularly update the wallet software. In new versions of software, vulnerabilities are usually eliminated, additional security features are added.
What to Do in Case of Cryptocurrency Wallet Access Loss
In case of loss of access to crypto assets, users can use several ways to restore them. Among the main ones are:
- using seed phrase;
- backup;
- recovery through a new wallet;
- using software;
- contact a specialized company;
- contect tech support.
We told you more about each of the recovery options in the article «How to Recover Your Cryptocurrency Wallet: a Complete Guide».
Let's consider how to regain access to Trust Wallet. The app offers 3 options:
- via seed phrase;
- Face ID or fingerprint;
- via backup.
To restore the wallet through the secret phrase, you just need to go to the menu: «Settings» — «Wallets» — «Add an existing wallet», select the network and enter the recovery phrase.
Common Mistakes of Digital Coin Holders
There are many factors that endanger your cryptocurrency wallet. Any of the mistakes listed below can cost all your savings:
Improper storage of backup phrase. It's best not to keep important data in a place where it can be stolen (including on a computer with constant internet access in unencrypted form).
Insecure devices. Not all wallets are reliable — one may offer maximum protection, while another may have vulnerabilities. Before buying/registering, it is better to carefully read reviews on the Internet and the reputation of the manufacturing company.
Inattention when making transactions. Incorrectly specified address will lead to the fact that the money will not reach the addressee, and it will be impossible to dispute the payment (unlike a bank transfer, for example).
Creating a Wallet for Storing Cryptocurrencies
A cryptocurrency wallet is not only a way to store coins but also a personal tool for asset management. Choosing the right type of wallet, understanding its functionality, and following security measures will help you interact effectively with cryptocurrencies.
Creating a cryptocurrency wallet is the first step towards secure cryptocurrency management. Your assets will always be well protected if you use your wallet correctly, store your seed phrase in a safe place and avoid risks. Regular updates and the use of trusted apps will help you keep control of your funds.
