Crypto Academy / Season 3 / Week 1 - Homework Post for [@allbert]―A world of Wallets and Exchanges

Thanks to professor @allbert for this wonderful lesson about "A world of Wallets and Exchanges". I read the whole lesson and enjoy it. This lesson covered many new things this was unknown to me. Now, I am ready to complete my homework task. Let's get started:

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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).

Wallet and exchange are two completely different things from one another. Wallet is used to store cryptocurrency and exchange is used for buying and selling cryptocurrency. In addition to these, there are a few more things that I will discuss now.

There are different types of wallets and they are exchanged and centralized and decentralized. Wallet gives a user a complete excess because the wallet's private key is with the user. But the private key of centralized exchanges is with the authority of that exchange site. So here a user never has complete control over his fund because the exchange authority does not provide private key.

Hardware wallet is the most expensive of the various types of wallets and many trusted whales use it. It is not within the reach of small investors because many people trade with the cost of it. There are also some more wallets such as Trustwallet, MetaMask, etc are private key users so they are more secure than the exchange. In addition to storing crypto, crypto exchange can also be done. But in case of crypto exchange, the fee is much higher. So exchange is the best option for buying and selling crypto.

We will use both wallet and exchange to facilitate trading. When we need to buy a coin, we have to buy it and keep it in our wallet, then it will be more secure. When we need to sell the coin again, we will take it to the exchange. That way we can take advantage of both.

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?

I think people should have more than one exchange account. Because different exchange offers us different facilities in many ways. So it is very important for those who want to trade with cryptocurrency to have multiple accounts.

We trade to gain something. So we have to take any coin with very little money. Before any new coin comes to the market, its price is much lower. First of all, the coins are first listed in the gate.io exchange. So we need to have an account on this site to buy new coins at low prices from here.

There is a difference between exchanging trading fees between exchange sites. Any exchange site deducts less fee and any exchange site deducts more fee. Low trading fee is very important for those who trade a lot, so you have to choose the exchange.

Not all coins can be found on an exchange site. So if ever there is a need to buy SBD coin but if someone has an account in Binance exchange then he will not be able to buy it. Because there is no SBD coin in Binance exchange. In this case, if you have an account in the Bittrex exchange, you can buy SBD coin.

People should use more than one exchange because putting all the eggs in one basket is riskier. But if you divide the basket and leave the eggs, even if one of the eggs falls off, the rest will be fine. So even in the case of trading, since the exchange sites are likely to be hacked, it is more secure to keep all the coins in one place without having to keep them separate.

I have accounts in a few exchanges, of which I use Binance exchange more. The reason behind using Binance exchange more is that it has a lot of coins listed. So it is possible to get almost all types of coins by trading here. Also, the trading volume of the Binance exchange is much higher so it always shows real market price so I like Binance exchange a lot.

3- What are better? Wallets or exchanges.?

The question of whether wallets are good or exchange is not answered in one word. Because the two have different purposes. Although you can swap a lot of time with the wallet, you can do the work of exchange.

Exchange We usually use it for buying and selling. But many times many people hold in exchange. Although the exchange is good, there are many problems with centralized exchange. But there have been many incidents of hacking in decentralized exchanges. Although nowadays exchanges have started to become decentralized.

If we talk about trust wallet in wallet then it is much better because it has coin holding as well as swap facility. So we can sync it with different decentralized exchanges and do swapping. But if someone has a lot of coins and security is the main priority then a hardware wallet can be used. Whales use hardware wallets for high security.

4- Create an account in a wallet and in an exchange of your choice and show screenshots of the process.

In this section, I am opening a wallet and an exchange account. I don't have an account at Poloniex exchange, so I will open an account at MetaMask wallet.

Let's start with how to open an account in MetaMask wallet:

• First, go to this site https://metamask.io/ and click download.

• Then download your extension according to your browser.

• Then open the extension and click Create a Wallet.

• You will see this window then click I agree.

• Set your password, tick the mark, and click Create.

• Now back up the phrase and click Next to continue.

• Now arrange the phrase and click Confirm.

• You will see this confirmation message then click All done.

• Now we are ready to deposit in our wallet.

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By following these simple steps you can easily open an account in the MetaMask wallet.

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Now I will show you how to open an account on the Poloniex exchange. Let's get started:

• First, go to this site https://poloniex.com/ and click sign up.

• You will see this form. Fill up with your email and a strong password. I have a referral code you may use your friends referral code then tick the mark and click sign up.

• You will get a confirmation link in your email. Check it and click the link to verify your email.

• After this verification process is done login with your email and password and we are ready to deposit.

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By following these simple steps you can easily open an account in the Poloniex exchange.

Conclusion

A good wallet is very necessary to keep your funds secure. Besides, considering the advantages and disadvantages of exchange, there are advantages of trading, so you have to have an idea about it.

If you want to trade in cryptocurrency, you must have a good idea about wallets and exchange. It is not possible to have a good trader by ignoring these two issues. In today's lesson and homework, I have shared with you as much as I know about wallet and exchange. I hope I have been able to give you some ideas.

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Thanks for patiently reading my post. I hope you enjoy it.

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Best Regards,
@masumrbd