Crypto Academy / Season 3 / Week 1 - Homework Post for @allbert
Hello Steemit Crypto Academy, hello Crypto Proofessor @allbert, for me it is a pleasure to be able to participate in this task, especially for talking about tools that are simply vital in the crypto world, they are just as you say in your class, the elements that allow us to make life in this financial eco-system based on Blockchain.
Let's talk about Exchange and Wallets.
1- Explain differences between wallets and exchanges as well as mention which operations should be performed in an Exchange and which operations should be performed in a wallet (in terms of fees).
It is good to be clear about the differences between each one, and this is basically determined by the function that each one fulfills, that is to say, the purpose for which it has been created. And therefore, the collection of commissions or fees for each task that is executed will have a certain value.
The exchanges were created to give the possibility to trade between different pairs of cryptocurrencies or between a cryptocurrency and fiat money, as in the case of Binance's P2P trading, for this reason the fees are usually not so high, because if someone who is permanently trading loses a lot in commissions, he would simply not use it. So transaction costs are generally low. For example in Binance the fee is about 0.1 of the transaction amount, and it decreases as the volume of transactions and capital increases.
In the case of Wallets, they are basically to store your cryptocurrencies in a safer way, so you have to be clear about the functions of each one. Of course, in an exchange you can keep your coins, but the security is much lower than in a wallet.
I must point out that there are some Wallets that have a quick exchange or Swapp, through which you can exchange between pairs of coins, without the need to send them to an exchange to exchange them and then return to the Wallet, but the great detail is that the costs of these transactions are generally very high compared to the fee of an exchange.
2- In your own words, Why You think people should have more than one exchange account?. Do you have an exchange account? and Why that specifically?
There are several reasons why I definitely recommend having several exchanges, at least two or three. Particularly I have 3 that are the ones I usually use, although I also have another one that I hardly use. I will mention the reasons why I highly recommend having different exchanges:
- There are times when an exchange is under maintenance of a specific wallet, which makes it impossible to receive that particular token, and if you need to make any change, or simply transfer to another wallet, you could not do it until the maintenance period is over, leaving your resources trapped for days or even weeks.
With certain frequency There are price differences between exchanges, which you could take advantage of to obtain some profit by buying in one exchange house and sending to another one to sell more expensive. If you only have one excchange this benefit would not be an alternative.
Not having all your resources in one place. Unfortunately in the short history of the cryptocurrencies economic environment, there has been the unexpected and unannounced closure of some exchanges, which produced total loss of resources of those who had everything in one place. So having several accounts in different exchanges minimizes the risk of that happening, i.e., as crypto professor @allbert said in his class: "don't put all your eggs in one basket ".
3- What are better? Wallets or exchanges.?
To answer this question I must refer to the first answer, each of them, Wallets and exchange, was created for a certain function, so it is not about evaluating which one is better than the other, since each one is for different things. Exchanges were created to serve as an exchange platform, so they are better for this purpose, and not for storing cryptos, since their security level is lower. But the cost of exchanges transactions are lower, so they are much better for this purpose than doing it in a Wallet.
The main function of Wallets is to safeguard our Cryptos, for this reason their security level is much higher, which makes them much better than an exchange, however the costs to perform a SWAPP exchange are very high which leaves them behind the exchanges in this aspect.
With this I mean that each one is better in the function for which it has been created, and although it could eventually serve to store (in the case of an exchange) or to exchange (in the case of wallets) it will not be the best thing that can be done.
4- Create an account in a wallet and in an exchange of your choice and show screenshots of the process.
I will try to be as explicit as possible in the opening process, so let's go step by step, all the images below will have a process sequence from left to right:
We go to PlayStore, look for SafePal Wallet, click install, once it is installed on our cell phone we must click open, and then click on SoftWare Wallet, it is this option that allows us to have it on our phone.
Then we are welcomed, and we must enter a password of at least 8 characters. I recommend using more than 8, with numbers, upper and lower case letters and special characters. No dates of birth, pet names, or anything like that.
Subsequently, you must place your fingerprint and a pattern, which only you should know. This will allow you to increase the security level of your Wallet.
Doing this will take you back to this point where you must again select Software Wallet, option create wallet, and it will ask you for the key that you have previously created.
After incorporating the key, it gives you the option to give a name to your Wallet. And here comes a SUMPTIOUSLY IMPORTANT* step, which is the creation of the seed phrase. This is where the Wallet is going to give you 112 words in a specific order, which you must copy, save, it does not allow you to screenshot. These words are your gateway to the Wallet in case you download the wallet on another device. Be it another phone or computer. It will allow you to access your funds, just with these words. This is one of the reasons why these wallets are so secure.
NO ONE ELSE CAN HAVE THOSE WORDS, AND YOU MUST NOT SHARE THEM ANYWHERE ELSE, I hope this is very clear.
Subsequently, you can make use of this Wallet, you can find it on your phone and be quite sure of your funds.
It's that easy, in a matter of minutes you can have your WALLET.
This being so I have concluded with my homework, assigned by Crypto professor @allbert, within the intermediate level in the STEEMIT CRYPTO ACADEMY. I hope I have fulfilled what is necessary to have a good evaluation.
Thank you in advance for your time and dedication.
A great week ahead for everyone.
Note: all images have been edited in Power Point. The phone used to download the Wallet was a Redmi note 8.
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Hello and thanks for participating in the Steemit Crypto Academy season 3.
Hi professor @allbert, I understand, thanks for the assessment and for clarifying the points where I should have gone even deeper. For the next activities I will be more explicit and I will continue to expand even more on the explanations in this regard. Have a nice weekend.