If you have decided to dive into the world of crypto but still don’t know where to start on this exciting journey, we, the Crypto Neobank Trustee team, have prepared for you some tips to keep in mind when choosing a cryptocurrency wallet. Here they are!
Learn the basics of crypto
First, decide which cryptocurrencies you would like to start investing in. If this is not a short-term hobby for you and you are serious about it, take time for a basic study of cryptocurrencies.
Find out about the core cryptocurrencies, the most popular and time-tested digital assets, such as Bitcoin and Ethereum, and don’t forget about stablecoins. This knowledge will give you a rough idea of which cryptocurrency you could start investing in.
Hypomania: Don’t blindly trust everything new
Probably everyone involved in cryptocurrency has been seduced at least once in their life and experienced FOMO the fear of missing out – an intense feeling that you are missing out on the next big thing in the crypto space and subsequently the opportunity to make large profits. We’d love to believe in miracles, but usually, their cases don’t always end well. But that doesn’t mean, however, that you can’t profit from such hyped projects. Simply, they need a more attentive approach.
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If you are considering investing in such digital assets as a fast way to earn money, it is important to focus on choosing a reliable coin that, at the very least, has its own wallet and ecosystem rather than finding a platform for operating assets.
How much of my income should I invest in crypto? Reasonable balance
A few words about the amount of money you need to start conquering the world of cryptocurrencies. Figure out how much money you are willing to invest in a venture, or even to lose. Don’t invest a lot right away in experiments with uncertain results. After all, crypto is a high-risk investment tool. Any professional market participant will tell you that.
However, investing a little bit at a time is not an option either. In this case, you risk reaching the “it’s hard to understand” point sooner than you expect, though the hope of income or fear of losing money will keep you from giving up too early.
Does the perfect tool exist? Spoiler: no!
Finally, back to the question of how to choose the right tool to start using cryptocurrencies. There are two main points.
- Keep it simple. Don’t look for a tricky wallet with all possible options that you haven’t even heard of before. Such tools are designed for professional users and can confuse the beginner. Your best friend is a simple, user-friendly wallet that speaks the same language as you.
- Be prepared to compromise. Don’t have any harmful illusions, because there is no such thing as a perfect tool. You will always have to make sacrifices.
With non-custodial wallets A decentralized wallet that does not belong to any organization. At the moment of creating a wallet, the user receives the access keys, and since they are only with you, like an electronic safe to which only you have access to, you will have to take full responsibility for accessing the wallet. However, you will also have exclusive control over your assets. This is both a pro and a con at the same time: if you lose your seed phrase, you can’t just call the technical support and ask them to restore your access.
The seed phrase is a set of random words (12 to 24 words) needed to access the wallet. This phrase is available only to the user because it is generated locally on his device when installing the wallet. It cannot be hacked; it is encrypted in such a secure way that it would take an incredible amount of time and processing power to hack it.
Thus, a non-custodial wallet is actually securely protected by your seed phrase, unless you lose it or open it to third parties. But if you lose it, you lose your funds forever. Read more about where to store and not store your seed phrase here.
If you do not want to carry this burden and decide to use a custodial wallet, you will have to accept the fact that your assets will be managed by third parties. Then you’ll be sure that, in case of a problem, you’ll get help from technical support, assuming you’ve chosen the right platform, of course.
Advanced research: dive inside the wallet
If you are not a newbie to programming but have no experience with cryptocurrency yet, check the open-source code of the wallet you want to use. Or at least read expert reviews and/or security audits.
Reputable projects don’t hide what’s under the hood and open source their code so everyone can check it out and improve.
Let’s fix all the points we’ve learned:
- Research at least the general features of coins that you are going to buy and do not fall for hype without going deep into their essence.
- Invest only as much as you are willing to lose.
- Choose a crypto tool based on your level of understanding of its features. To begin with, you need a convenient, simple, and user-friendly wallet that can be easily managed even by a beginner.
- If you don’t want to really bother with seed phrase storage, choose a custodian service with a strong reputation and human technical support that is always in touch. Ideally, be polite and friendly.
A really important point. In order to avoid screwing up and becoming a victim of a scam, choose a service with a high reputation in the crypto community, a clear website with all necessary documents, a transparent team, an available office, and a functioning legal field. One of the best tools to meet these requirements is Crypto Neobank Trustee Plus, which is authorized as a Virtual Asset Service Provider in Europe.
Anyway, be daring, start trying new things, and the world will offer you surprising options for financial freedom. Good luck!