The results should not surprise you
If you thought Bitcoin was going to drop after the Bitcoin Spot ETF then you would have guessed right. Guessed is the important part. Some guessed that it would take off with millions of inflows from the institutional money. Others are already reading into Larry Finks comments on an XRP ETF. Things are getting wild.
The thing is that we’ve shared on the good and the bad on some facts about the Bitcoin Spot ETF and that will most likely evolve as the bull cycle continues. What has also evolved are the best practices to store and track your digital assets (especially with tax season knocking at our doors).
The first digital wallet came with the first Bitcoin
The first ever crypto wallet was created by Satoshi Nakamoto and the first digital currency, Bitcoin in 2009. It utilized cryptographic keys, a long string of random and unpredictable characters, to secure and manage currency holdings. The issue with the first wallet was a user how to download the entire history of the Bitcoin blockchain (which could have taken a few days at the time in 2009 to download).
The first digital mobile wallet was released in 2011 as an Android App and then finally the first hardware or cold wallets were released in 2014 where one of the pioneers was Trezor (my choice of cold wallet). A cold wallet is a wallet that specializes in storing private keys offline, reducing the risk of online attacks, and became more popular among users who prioritized the safety of their cryptocurrency holdings.
Fast forward to present day where there are 3 popular types of wallets and ways to store your crypto:
– Hardware Wallets or Cold Wallets (Trezor and Ledger)
– Software Wallets or Hot Wallets (Gemini, Coinbase, and Uphold)
– Paper Wallets
The Wallets
I’ve used different exchanges and wallets. Here are some of my favorites and some highly recommended ones:
Hot Wallets
Gemini
Pros:
– One of the few with derivatives trading for crypto.
– No maximum trade amount and NO fees on withdrawals.
– One of the easiest to use and US Dollar accounts are insured to a certain amount.
Cons:
– Slightly more limited in cryptocurrency choices compared to others on this list.
– Requires more personal information than most.
– More downtime than other exchanges on the list.
Coinbase (one of my favorite exchanges):
Pros:
– Extremely secure and simple to use
– No maximum trade amount and NO fees on withdrawals.
– One of the easiest to use and US Dollar accounts are insured to a certain amount.
– One of the oldest exchanges on this list
– Offers a digital wallet as well.
Cons:
– Some lesser known coins are not listed.
– Delisted XRP during the SEC case.
– Not available in all countries
– Maximum daily trading amount of $25,000
– Up to 3% withdrawal fees as of writing
Binance:
Pros:
– No maximum daily trading amount
– Lowest trading fees on this list
Cons:
– A more difficult user experience for beginners.
– KYS verification system has a bad reputation.
Uphold:
Pros:
– Allowed purchase of XRP when they were going through their SEC case
– Access to lesser known cryptocurrency.
Cons:
– A confusing user interface in my opinion.
– Harder to withdrawal your money compared to others on this list which has been mentioned in multiple complaints.
Cold Wallets
Trezor (my current cold wallet):
Pros:
– Relatively affordable for what you get.
– Supports and stores over 8,000 coins.
– Additional security features compared to Ledger (Shamir Backup Recovery). Also includes an additional 25th passphrase feature.
– One of the easiest to use and US Dollar accounts are insured to a certain amount.
Cons:
– No mobile app
– Not much educational content
Ledger:
Pros:
– Also includes an additional 25th passphrase feature (only Trezor and Ledger offer this).
– Easier access to dApps
– Has a mobile app as well as desktop app.
Cons:
– Experienced a few hacks that have impacted dApps.
– Device firmware not fully open source.
– Only 5,500 coins available.
– Base model is more expensive than Trezor base model.
Evaluate and keep your keys
There are a lot of options out there to track and store your crypto with one of the strongest safest options being a cold wallet. Make sure you continue to do your due diligence, research your options (and your crypto projects), and don’t let your emotions get the best of you. Another thing to keep in mind is taxes on your crypto currently and I currently use Koinly after testing a few and this was the most integrated into my wallets and ledgers.
