Not so long ago it seemed as living in a digital era is something, we’re not going to experience that soon, but the world and its changes started developing rapidly a couple of years ago. All of a sudden, everything is turning digital, and people have accepted digital money as a smart investment and payment method. Which is the reason why the majority either has some crypto stored, or is thinking about buying. How, where, and for how long should one keep crypto is something we’re going to discuss in this article.
Logically, to be able to store cryptocurrencies, you must first own them. And the process of buying cryptocurrencies goes (in the majority of cases) through different trading software. After one buys coins, it is important to determine their purpose. Some people buy to trade on daily basis, some buy because they want a long-term investment), some prefer to combine. Depending on the purpose, it is necessary to choose the degree of liquidity required to perform such an action. In the world of digital assets, liquidity refers to the ability to convert a cryptocurrency into money or another cryptocurrency. Furthermore, according to the degree of liquidity, you can finally determine where you would like to store your coins.
Keeping your crypto on the trading platforms
When buying cryptocurrencies, most offer the option of storing them through their wallets (this means they remain on the trading platform). You should consider this option if you plan to trade them frequently. Keeping them on the exchange platform provides the highest level of liquidity due to the possibility of instant transactions because they are kept on the trading platform and there is no need to transfer them from another type of wallet to the place of trade. However, high liquidity in this case brings with it numerous dangers, and the most common are hacker attacks. These attacks have to some extent left their mark on the crypto market ever since they first appeared. And it’s no surprise. Given the fact that they are digital, and some carry quite a value, they are appealing to hackers thinking it’s a great way to earn tons of money.
Perhaps the most famous hacker attack is the one in which 450 million US dollars’ worth of bitcoins were stolen. The platform from which these assets managed to disappear was involved in about 70% of the world’s bitcoin transactions and was considered impenetrable until the time it was hacked. Until today, a similar scenario has occurred in the crypto market dozens of times. As much as a good security system the platform possesses, there is always the option of a hacker attack, with the high probability of losing funds. It is also important to note that these platforms in most cases will not recover lost funds to their users. With this in mind, it is important to make cryptocurrency owners aware that if they keep their assets on the trading platform for long, they do not actually own them. If you do not have the private key of your crypto wallet, you simply do not own your funds.
There is one more risk exchange platform are highly exposed to, which we failed to mention. Outside the risk of hacker attacks, problems may arise within the organization of the platform itself. Many of you reading this are probably aware of the situation where the owner of one such platform died, along with the private keys of all users. Millions of dollars were lost this way, and there was nothing that could undo the damage.
Some countries have decided to protect those who like to invest in these digital assets, and authorize certain trading platforms, like https://yuan-paygroup.com/. Since so many people are investing and trading, this came as a smart solution.
For those who like to keep their assets for a longer period of time, it is highly suggested to purchase a different kind of wallet, than the one offered by the mentioned platforms. These wallets are evaluated as the safest because you can only access them via a personalized digital key. No one other than you can touch them. They can either be stored on your hardware or online.
However, the majority of people still like trading, to keep their assets in circulation. There are some things one should consider in order to find the safest possible platform for trading. Read below.
Security fund is important
The first thing you need to check is whether the trading site has a fund security feature or not. If you are willing to make a huge deposit, you need to be sure that the amount you are investing is safe. Obviously, no one would want to lose money. Everyone wants their money to be in a safe place, without risk.
Take some time to read the information available on the Internet from various references before exposing your money to risk, without even ensuring the credibility of the platform.
Availability is important
By this, we mean the availability of coins you can purchase. Not every platform has enough, so based on your coin preferences, check if the platform has enough resources for your trading.
Many trading platforms make money by taking transaction fees. Whenever you trade crypto or choose to withdraw funds on your card, you will have to pay a certain fee for it. So, before you get started, take a look at the fee structure. No one wants to pay half the amount of revenue to sites that require huge amounts of transaction fees.
The most important thing to keep in mind when finding the right platform to trade is legality. There are a lot of platforms that are not legalized, so many investors are deceived. Try to verify that a particular platform is legally registered before making a final decision.
There are many other factors to consider, but following these should make sure you choose the safe one.
And our final advice would be to transfer your funds to your card every now and then, to avoid bigger losses.