A Crypto Wallet or an Exchange? Which is the Best?
Typically, a crypto wallet lets investors store their digital assets. On the other hand, an exchange is a platform that allows users to not only convert fiat currency into digital assets but also buy and sell digital currency.
Now the question is, should you store your digital asset in an exchange or a crypto wallet? Even though most exchanges provide storage for digital assets, it is recommended that you store most of your digital assets on a separate wallet. This is due to security concerns associated with online exchanges.
Since exchanges deny you the privilege of owning your private keys, the security of your digital assets is not guaranteed.
Here are some of the differences between an exchange and a Crypto wallet.
A Crypto Exchange
Aside from conversion, exchanges lets you buy and sell digital currencies at the current market rate. Typically, exchanges simplify the crypto trading process by offering users an opportunity to buy and sell digital assets from one place.
If exchanges never existed then you had to find someone outside the platform to buy your digital assets. This may make the crypto trading process more complex. To access a single place where you can sell and buy digital assets then exchanges offer an ideal option.
The good news is that some exchanges have integrated a wallet on the platform. This means if you don’t have a wallet, you can use wallets on exchanges to store your digital assets.
The downside of holding your digital assets on online exchanges is that they are prone to cyber-attacks. Additionally, an exchange can easily suspend your account under the pretense of suspicious activities. This may lead to the loss of your entire investment. On this, crypto wallets still top the game.
Just like Defix and many other crypto wallets available in the internet space, they make it easy for you to manage your crypto portfolio. Aside from selling, buying, and securing your digital assets, crypto wallets offer important trading insights that are ideal to help you unlock more opportunities for your investment.
All you need is to download and install a crypto wallet to get started. Unlike wallets provided by some exchanges that are prone to cyber attacks, a crypto wallet comes with great security features that make it difficult for a third party to access your funds.
Remember if you store digital assets on an exchange, you may not have access to your private keys. This means your funds are under the control of a third party. Should anything happen then you risk losing your entire investment.
Even if you prefer trading on exchanges, we encourage you to transfer some of your funds to an external wallet to secure your investment.
Whether you are an established crypto investor or just starting with crypto, the security of your digital assets should be your top priority. It is against this backdrop that we encourage you to use the Defix wallet to not only secure your crypto holdings but also get access to helpful resources to help you with your trades.
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