Crypto Academy Season 3 | Intermediate course by @allbert - Task 1: A world of wallets and exchanges
I want to appriciate proffessor @allbert for this wonderful lecture that was thought. Afterafter reading the wonderful lecture, i decided to prepare my homework.
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).
Wallets
A wallet is used to store cryptocurrency. A wallet comprises one or more private keys that permit you to sign a transaction. These private keys are the mathematical proof that you are truly the owner of a particular amount of crypto currency. In other word, these private keys are secured and secret codes that allow you to spend your cryptocurrency.
Exchange
On the other hand, an exchange is a platform or service that lets you convert real money or fiat money like US dollars and some other to cryptocurrency. The exchange platform allows you to convert your cryptocurrency back to your fiat currency.
- A wallet allows you to store cryptocurrency while an exchange allows you to store cryptocurrency and also buy and sell cryptocurrency.
- A wallet is very secured while an exchange is not has secured as a wallet.
Which operations should be performed in an exchange and a wallet in terms of fees
The fees and cost per use of a wallet is higher than exchange platform. A wallet charges dynamic fees, which means the transaction fees can be different based on reasons such as transaction amount.
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?
It is very important for one to have more than one exchange account so as not to lose all the asset because of attackers. The private keys are very essential. If attackers steal your private keys like if they malware working on your computer, they could transfer your asset. For instance, they could use your private keys to transfer your crpytocurrency to their wallet. The is one of the main reasons why it is important to have more then one exchange account.
I have a Binance exchange account.
Why I choose Binance specifically- Binance have over 500 crypto currencies- It has multiple trading interfaces such as order types, derivatives and futures.- You can buy and sell, deposit and withdraw, stop order, limit order, margin, options and also futures trading.- The fee is low compared to some other exchange platform.
What are better? Wallets or exchanges?
Wallet is better because is more secure than exchange platform. A wallet gives the you phrase that comprises of some word which help to secure your wallet.
Create an account in a wallet and in an exchange of your choice and show screenshots of the process.
Download trust trust wallet from your play store and then click create wallet.
You should backup you wallet in a safe place. I was not allowed to screenshot my wallet security phase.
Wallets and Exchanges are very importance tk manage our cryptocurrent that we possess. It is also importance that we keep our private keys for our exchange and also our security phrase for our wallet in other for attacker not to penetrate it. A wallet is more secure and an exchange because of it security process but an exchange also have it own adavanges.