Crypto Academy / Season 3 / Week 1 - Homework Post for Professor @allbert

Hello everybody, Hope you all are fine and in good health!

My this post is a Homework Task assigned by professor @allbert

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:

Every one of us keeps our money in one or the other thing to keep it safe, such as pouches, handbags, drawers, or safes. Similarly, wallets are online safes for our cryptocurrency that opens with the help of keys. In technical terms, they are applications or software that help us store money.

Exchange:

An exchange is a platform that is used for buying and selling cryptocurrency. They are marketplaces of cryptocurrency where users trade cryptocurrency. Exchanges show buying and selling charts for different cryptocurrency pairs so that you have an idea of market trends.

Difference:

Wallets	Exchanges
Used for keeping and storing crypto for later access	used for trading cryptocurrency
Wallets are more secured for keeping money as you are the only one with the key, and you can access your money if the exchange is close	Exchanges are more centralized and may not be considered very safe for keeping money
you access it by a key, mnemonic, or a phrase	you can access it through an email and password

Operations:

Both wallets and exchanges now allow much more than their traditional operations. In terms of fees, we can perform the following operations on wallets and exchanges.

Wallets:

With your wallets, you can do staking and get access to various platforms via web 3.0 at very low rates. In addition to that, you can use your wallets for Decentralized Finance.

Exchanges:

Various exchanges now allow the staking of coins for earning profits through interests on your own money. Furthermore, other exchanges have moved a step further in having their own coins—they offer much less fee on trading those coins and additional benefits on holding them.

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?

In my view, having more than one exchange gives you an array of options. For example, some exchanges allow specific trading pairs. So, if you have more than one exchanges, you can trade in more pairs than while having an account in only one exchange.

Similarly, different exchanges have different trading volumes, transactions fees, deposit fees, and transaction timings. So here also having more than one exchange give you the opportunity to compare and select the suitable for profitable and time-saving trading experience.

To quote an example, exchanges such as Binance, Coinbase, and Swapzone offer a spectrum of trading pairs, but they are often heavy due to large usage worldwide, so for quick trading at that time, you can use exchanges such as Bittrex, which may have limited trading pairs but may be helpful in such situations. 

Several exchanges offer low transaction fees than the others, such as the Poloniex.

Some exchanges may operate in one or more countries when it comes to the area, while others may be allowed in more countries. Such as in Pakistan, we can easily use Binance.

So, in a nutshell, having accounts on more than one exchange is actually a very good idea.

My account:

I have an account on Binance. I used Binance because it is well-known, secured, and offers a large number of trading pairs. It is available all over Pakistan and we have various trading tools such as the options of loans, staking coins, order books and various trading styles. In addition to all this Binance has very low transaction rates. 

What are better? Wallets or exchanges?

In my view, we cannot say which one is better and which is not. Both the wallets and exchanges have their own benefits.

In terms of holding and storing money, however, wallets are better than exchanges because, with wallets, the user is the one who is in control of the coins. Only he knows the security key, and so the funds remain safe from hackers. In addition to that, the funds are all-time accessible even if the exchange is closed.  In addition to that, wallets are decentralized, and that again gives the user control. Wallets such as the trust wallet, Metaapp, now allow their users o connect to Dapps too.

Exchanges, on the other hand, are ideal for trading with them. You can sell and buy coins without transferring them from one place to the other. Exchanges give you access to trade volumes and liquidity. For trading, they are more secure and safe.

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

I will be making an account in the trust wallet.

First of All, I went to the google play store and downloaded the App

After that the I opened the app after it was installed and clicked on create a wallet.

Then I ticked the terms and services dialogue and clicked continue.

Then I allowed for the backup and clicked continue.

Since you are not allowed to take pictures of the key phase, I used another mobile to take photos for study purposes. I set my key and clicked continue.

Then I had to verify the key.

My trust wallet was created.

Now I will show How I created an account in Poloniex.

First of all, I downloaded the app from the play store.

I opened it after installing it and clicked continue.

You can use the signup option by clicking on the Settings option in the bottom right corner.

Then select signup

After that, I had to fill in my email and generate a password.

After filling email and password, click on verify and then signup.

After signing up, you have to verify your email.

You will receive an email. Open your email account and click on verify email

Your email will be verified.

Now you can log in.

After logging in, the main page will appear again.

Conclusion 

To conclude the questionnaire we can say that wallets are ideal for. Holding and keeping coins and exchanges provide a smooth way of direct trading. Having a number of exchanges and wallets enable you to have greater options than having a single.