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A crypto wallet is a place where you can securely keep your digital currency. There are many types of crypto wallets. The most popular are hosted wallets and non-custodial wallets.

Which one is the best option for you is based on you plan to do with crypto and what type of security net they offer.

Hosted wallets
Hosted wallets offer the easiest method to set up a crypto wallet. Your crypto is automatically stored in a hosted wallet when you purchase it with Coinbase. It’s called hosting because the third party stores your crypto for you. It functions in the same way that a bank holds your money in a checking/savings account. People have been known to lose their keys, or even their USB wallets. With the hosted wallet, there’s no need to worry about that.

The best thing about keeping your crypto on an account hosted by a host is that you don’t have to remember your password, and you’ll not lose it. One disadvantage of a hosted account is that you don’t have access to all the crypto that is available. However, this could change as hosted wallets get more adept at supporting more features.

How to set-up an account for a bank that is hosted

Choose a platform you feel comfortable using. Your primary concern should be security, usability, and the compliance with government and financial rules.

Create an account. Provide your personal details and select a secure password. You may also opt for 2-step verification, commonly referred to as 2FA to add an extra layer of protection.

Transfer or purchase crypto. Many crypto exchanges and platforms let you buy crypto using an account at a bank or credit. If you already own cryptocurrency, you can transfer it into your host wallet to keep it safe.

Self-custody wallets
A self-custody-based wallet, such as Coinbase Wallet, puts you in complete control of your cryptocurrency. Non-custodial wallets do not depend on third party services such as “custodians,” to protect your cryptocurrency. While they offer the necessary software to store your crypto but it’s your responsibility to keep your password secure and to remember. If you forget or lose your password — commonly called a “private key” or “seed phrase” There’s no way to access your crypto. And if someone else discovers the private key to your account, they’ll have complete access to your accounts.

Why do you need a non-custodial bank account? Not only can you maintain complete control over your security in crypto, but you also have access to advanced crypto functions like yield farming, staking, and lending. The option of hosting a wallet is the best choice if you just want to send, receive, and buy crypto.

How to make a non-custodial bank account:

Download an app to your account. Other popular options include Coinbase.

Make an account. Not even an email address.

Your private key must be written down. It is presented in a random 12-word phrase. Keep it in a safe place. This 12-word phrase will block you from accessing your crypto.

Transfer cryptocurrency into your wallet. You can’t always buy crypto with traditional currencies like US euros or dollars. This means that you’ll have to transfer cryptocurrency to your account that is not custodial from another location.

Coinbase customers have two choices for self-custody and hosted wallet. Hosted wallets are available through the Coinbase app. It allows you to trade and purchase crypto. To benefit from a standalone Coinbase Wallet, you can also install the Coinbase Wallet App. A lot of our customers have both. This makes it simple to buy crypto using traditional currency and take part in the latest crypto activities. The cost for creating both wallets is absolutely free.

Hardware wallets
Hardware wallets keep the private keys of your crypto offline in a device that is about the size of a thumbdrive. They are not often used because of their complexity and high cost. However, there are some advantages. They can safeguard your crypto in the case of a hacker. They are more complex than software-based wallets and can be difficult to use. They also can cost up to $100.

How do you setup your hardware wallet

Purchase the hardware. The two most popular brands are Ledger and Trezor.

Download the program. token+ has its own software. To set up your wallet, you’ll be required to follow these directions. Follow the steps to create your wallet.

Send to you wallet.

There are many ways for storing your crypto, just like you can keep cash in a bank account , or safe. A hosted wallet is a great option. It is also possible to have complete control over your crypto by using an uncustodial wallet. Also, you can get additional security with a physical wallet. With cryptocurrency, the possibilities are endless.