With cryptocurrencies, buying tokens is only half of the process. As anyone who has read the news on cryptocurrency exchange hacks knows, storing your crypto on an exchange is a game of Russian roulette – your money vs. the ever-increasing chance of a hack. Since any coins you store on an exchange are actually stored in the exchange’s account (with access given to you), it can become unavailable to you in the case of a negative event (not just hacks, but outages, congestion, government crackdown, and so on).

For long-term investors, also known as HODLers, there is a constant worry about losing their holdings held on an exchange. Centralized exchanges like Coinbase, Bittrex, and Binance are prone to hacker attacks – with Bitfinex and Mt. Gox as infamous examples.

Cryptocurrency wallets provide a solution to the dreaded possibility of losing access to your money by allowing you to take your crypto away from exchanges and deposit them into a one secure location.

What is a cryptocurrency wallet and how does it work?

  1. Wallets allow cryptocurrency investors to secure their holdings in wallets only they control.
  2. There are all sorts of cryptocurrency wallets: online, desktop, hardware, and even paper ones.
  3. Different wallets support different coins.
  4. It is often up to the coin’s issuer to make sure there is a stable, secure, and light wallet that supports its coin.

For these reasons, many companies creating new digital coins are releasing their own wallets where holders can securely store the company’s unique tokens away from exchanges. Proprietary wallets offer increased value to coin buyers and make a company’s token more attractive by offering increased security, usability, utility, and user experience (UI) in order to make it as easy as possible to use for both long-term investors and those who want to move their coins to and from exchanges for trading.

Ultimately, companies should want the holders of their coin to have the ability to safely store and access them on any device.

To find out more about cryptocurrency wallets and all facets of digital coin creation and marketing, get in touch with the ICO experts at iAM Marketing today.