How to Store Cryptocurrency?

Entities can hold units of cryptocurrencies in wallets – offline and online. Each such wallet holds a public key, i.e. the wallet hump.io address and a private key (used to sign off payments). In any case, it is not exactly the units of cryptocurrency that one holds but the private key.

Nevertheless, entities can select from a wide range of crypto wallets, each catering to a different purpose. Online wallets largely serve the purpose of regular transactions. Apple, as well as J.P. Morgan Chase, Visa, and Facebook, have introduced online crypto-wallets. Conversely, offline or cold wallets are stored in a person’s hard drive and serve the purpose of security of cryptocurrency.

Cryptocurrency Advantages and Disadvantages

a) Protection Against Inflation: Inflation has led several currencies to lose value over time. The amount of any coin is specified in the source code. As demand grows, its value rises, keeping pace with the market and, in the long term, preventing inflation.

b) Privacy: Cryptocurrency privacy and security have long been key concerns. The blockchain ledger is built on many mathematical problems that are difficult to decode. As a result, bitcoin transactions are more secure than standard electronic transactions. To improve security and privacy, cryptocurrency uses pseudonyms that are unrelated to any user, account, or stored data that may be traced to a profile.

c) Self-Governed: The governance and upkeep of any currency are critical to its development. Developers/miners hold cryptocurrency transactions on their hardware and receive the transaction fee as a reward. Since miners are compensated for their efforts, they keep transaction records accurate and up to date, preserving the cryptocurrency’s integrity and keeping records decentralized.

d) Decentralization: One important advantage of cryptocurrency is that it is mostly decentralized. Many cryptocurrencies are controlled by the developers who use them and people who own a large amount of the coin or by a firm that develops it before it is given to the market. Decentralization serves to keep the currency monopoly free and in check by ensuring that no single entity determines the flow and value of the coin, which, in turn, keeps it stable and secure, not like fiat currencies, which are controlled by the government.

e) Easy Transfer: Cryptocurrencies have traditionally been seen as the best option for transactions. Cryptocurrency transactions, whether international or domestic, are lightning fast. Because there are minimal barriers to overcome, the verification takes extremely little time to complete.

Demerits Associated with Cryptocurrency
a) Some coins cannot be obtained in other fiat currencies: Some cryptocurrencies are only available in a single or a few fiat currencies. This forces the user to first convert these currencies into one of the major currencies, such as Bitcoin or Ethereum, and then to their desired currency via other exchanges. This only applies to a few cryptocurrencies. This results in the addition of superfluous transaction fees to the process.

b) Hacks: Although cryptocurrencies are extremely secure, exchanges are not. Most exchanges save user wallet info in order to correctly operate their user ID. Hackers can steal this information and get access to a large number of accounts. These hackers can quickly move funds from those accounts once they have gained access.

Some exchanges, including Bitfinex and Mt Gox, have been hacked in recent years, and Bitcoin worth thousands and millions of dollars has been stolen. Most exchanges are now highly secure, but there is always the possibility of another hack.

c) No refunds or Cancels: If there is a disagreement between the parties involved or if funds are sent to the wrong wallet address by mistake, the sender cannot retrieve the coin. Many people can utilize this to defraud others for their money. Because there are no refunds, one can simply be formed for a transaction for which they never received the product or services.