Great you have been able to get you hands on some Bitcoin, if you used an exchange you may have it sitting on the exchange wallet, unless you plan to be day trading this is not a recommended practice for several reasons:
- You do not hold the private keys for this wallet but the exchange does and as you will come to find out not your keys not your Bitcoin.
- Exchanges are the honey pots for attacks due to the large amount of crypto that they hold here is a very short list of exchanges that have been hacked: Mt. Gox 2014, Bithumb 2018, QuadrigaCX 2018, Binance 2019, Coincheck 2020.
- The exchange could also lock your access to you funds for whatever reason this will deny you the holder the ability to withdraw the funds.
- The owners may decide to close shop pack up and go and leave it users hanging, these among others reasons are enough for each to hold their own Bitcoin.
One of the best qualities of Bitcoin is that it does not require a third person or entity for you to store and transact with it, you can be your own bank and not have any restrictions on how, when , where and why you would like to use your hard earned wealth.
The best way is to start and to get the swing of things is with a non custodial software wallet where you hold you own keys and and have the control, there are also hardware wallets these are even more secure because they keep your private keys off line most of the times and some all of the time, below is a list of some of these wallets that I have had interaction with:
- Electrum: Software Bitcoin only wallet available for desktop and mobile.
- Trust Wallet: Software Multi-crypto mobile wallet.
- Samourai: Software Bitcoin only available for mobile Android only.
- Bitcoin Core: Software Bitcoin only available desktop and node.
- Trezor: Hardware multi-crypto wallet.
- Keep Key: Hardware multi-crypto wallet.
- Ledger Nano S: Hardware multi-crypto wallet.
- ColdCard: Hardware Bitcoin only wallet.
- SafePal S1: Hardware multi-crypto wallet.
In upcoming posts we will be diving deeper on wallets, what they do how they do it etc. keep an eye out for more.