Advice on using a crypto wallet.
A few months ago a bought a bit of cryptocurrency using kraken.Ive got about 2 grand now.Im wondering if it’s a good idea to buy a wallet or is it not really worth it with the amount I have.If I need a wallet could someone explain which one I need and how I go about using it,as I have absolutely no idea.I also don’t own a laptop but would get one soon if needed.CheersPosted 9 months ago
Are you meaning an electronic wallet like a Trezor?Posted 9 months ago
I was wondering the same. I have just over half what you do. I don’t intend to trade much so need somewhere to keep it.Posted 9 months ago
As I see there are two risks – the whole crypto thing is one massive bubble waiting to burst and leaving everything I have worthless (quite likely, a risk I’m prepared to take in the hope that I get out in time) Secondly, a hack or some such and everything I have just vanishes, no FSCS bailout or anything like that, probably less likely but you never know.
What I think you are asking is about a ‘cold store’ (I think that’s what they are called?) Put it on a harddrive type device under the mattress and just leave it. Reduces the hacking risk considerably, but then burglary, fire, wife having a clearout and binning it risks appear instead. Back it up online? Back to the hack risk.
I decided that I might as well do something with mine so I moved my Bitcoins and Ethereum to another online storage at BlockFi, one which pays interest, 6% on bitcoin and 5% on ethereum. Did a bit of research to chose one which appears reputable. If I ever get a lot in there I might open a second account elsewhere and split it to spread the risk.
I buy through coinbase as the fees are 0.5% (https://www.coinbase.com/join/howett_6 That’s my refer a friend thingy, use that and you get $10 of bitcoin)
I have then set up an account at BlockFi and moved my bitcoin and ethereum across, small transaction fee to do this.
Another plug, https://blockfi.com/?ref=dd67ec53 is my BlockFi refer a friend thingy, you get $50 if you join using that.
You don’t need anything other than the account. It gives you link, go to where your stuff is now and click send (maybe send $1 first just to check it. Fees reduce considerably on bigger amounts though so don’t send it al in dribs and drabs)
Anyway, shorter version – probably not, nothing is risk free, might as well leave it online and get some interest in my opinion. I am not an expert.
the whole crypto thing is one massive bubble waiting to burst and leaving everything I have worthless
This has been a fear of mine (and friends) too. But take, for example, Binance coin (BNB) the native coin of the Binance exchange. When I registered I got 100 free BNB. I may have bought more, can’t remember. I didn’t really look at it much for 2 or 3 years and then relaised I had £2k so sold them with exactly this fear in mind. Today, one BNB is worth $581. A friend had 10,000 BNB. Sold them. He would have $580k today if he hadn’t.
Which is all to say, having learned the hard way, any crypto you have, keep hold of it if you can afford to.
Next point, I bought some COSS on coinhouse.eu a few years back. That site / exchange went down the pan, with my COSS. It doesn’t amount to much, but brought it home that crypto is still unregulated so there’s a high risk of losing it all regardless of whether “the bubble goes pop”.
I have a Trezor which is sadly unused. It makes me nervous as I’ll have to keep it safe, as well as the recovery keys. But in theory, it’s safe.
Alternatively, store it in a paper wallet.Posted 9 months ago
I have a paper wallet with about £500 of XRP in it, no idea where I wrote down the password though :p As has been said, you mostly just shift the risks with a paper wallet vs leaving them on the exchange where you bought them (and also incur transfer fees in doing so).
I’d say the main drivers for wanting them in a paper wallet are either you don’t trust the exchange (either that they’ll go under or have a security breach) or that if a big drop does start happening and you want to sell you might have issues with a transaction backlog in your chosen exchange and by the time you move them elsewhere to sell they could be worthless. I think the latter reason is less of a concern these days as bitcoin has been a bit more stable (I’ve just gone and jinxed it).
I have some other Ethereum and Bitcoin but just keep those on eToro as I trust them enough and it’s a fairly small amount just to play the dips and rises rather than a load as a long term investment. For the OP’s £2k worth I’d probably keep it on KrakenPosted 9 months ago
Definitely recommend a hardware wallet if you’re keeping an amount and not intending to trade regularly. I use a ledger nano s for mine, and the big thing is you have to keep your 24 word key phrase secure (in a place you remember, not online or on an electronic device). I have a copy kept safe at home, and a family member keeps another copy for me. This is the least hackable/corruptible way of storing crypto provided you keep hold of the keys.
The caveat is that hardware wallets (and the sending of crypto to accounts in general) is not yet user friendly or intuitive, and if you get the addresses wrong it can be lost forever. I use kraken to buy and trade, and only keep small amounts on the exchange at any time. Kraken does seem a lot more trustworthy than the horror stories I’ve heard of older exchanges locking peoples funds and not giving access or it somehow disappearing.
If you’re willing to put the time into reading up on how a hardware wallet works, it’ll be the safest way to store, but if you don’t want to get into that side of things you may be better off leaving it on kraken. It’s all down to you personally. It may be 2 grands worth now, but in five years time who knows?
The original idea of cryptocurrency is to decentralise finance (although I do like a short term financial gain!). If left on an exchange or website it’s subject to the whims of the companies running the exchange or individual government’s sanctions.
There’s no right or wrong way to keep it, and at the moment there’s a certain risk with whichever option you go for. Probably a bit of a long winded response that doesn’t actually help, apologies!Posted 9 months ago
I have a paper wallet with about £500 of XRP
When was it £500? Has had a tidy run recently (right after I sold all mine when it crashed due to SEC review)Posted 9 months ago
@andrewh – I signed up with your link to Blockfi. I guess I need to deposit something to get the $50. Which makes me realise my ETH and BTC is held in an ETF on a “traditional” investment platform, rather than a crypto exchange. Hmmm. Those interest rates are appealing!Posted 9 months ago
Cheers Jimmy.Posted 9 months ago
They are but I assume decent interest rates means a bit risky. Maybe half in there and half in another one just in case? I’ve left half mine on coinbase and only put half in there
This is probably of interest regarding getting interest on crypto, not watched it all yet thoughPosted 9 months ago
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