It's crucial that you keep your private key safe. Remember, if someone obtains your private key, they can do whatever they like with your crypto. Keeping your private key safe is a top priority.
Leaving cryptocurrency on Coinbase is generally okay in the short term. Coinbase will store your crypto for you if you leave it there, but to be super-duper, extra careful (which we highly recommend), you should move it to a "cold storage" wallet.
A cold storage wallet is one that you control. The wallet creates a key pair for you (a public and private key) that is not stored anywhere on the Internet. No hacker can obtain your information, and your private key is safe.
To move your money to cold storage, you’ll need to purchase a usb-looking thingy. The hardware and software inside keeps your information safe while allowing you easy access to your crypto.
After lots of testing, we've found that the best two cold storage options are the Ledger Nano S and the Trezor. We here at Bitbuddy use the Ledger Nano S.
Check them out here:
(Note: these are affiliate links! If you use them, we'll get a small commission, which we use to continue producing high quality content. If you'd prefer not to use our affiliate links, click here for Ledger and here for Trezor)
To transfer funds from Coinbase to your wallet, follow the instructions on the website of whichever wallet you choose. If you chose the Ledger like we did, you can find your public address by hitting the "Receive" button inside your wallet.
Copy that address (the numbers and letters) and return to Coinbase. Click "withdraw" in your Coinbase wallet, paste your Ledger address, and click "transfer". Be sure the entire address was copied! If one single letter on the address is incorrect, your crypto will be lost.
You're good to go! Make sure the Bitcoin made it to your wallet–this can take a bit, so be patient. In the meantime, you can make some chocolate-chip cookies or something. Here, we pulled up some recipes:
Now, with your belly filled and your crypto in your wallet, it's time to put your wallet in safe place. Your wallet holds your private keys, so put it somewhere secure (like a safe, or a bank vault, or your cookie jar).
If you happen to lose your cold wallet, don't panic. You can recover your crypto using the configuration phrase given to you when you first activated your device. Be sure to store that phrase safely as well.
And that's it!
To buy crypto, you can use an online exchange, which creates a public address and a private key for you. Buying crypto on an exchange is as easy as linking a payment option and typing in how much you wish to buy.
After receiving the cryptocurrency in your exchange wallet, which may take a few days depending on your payment method, it is a good idea to transfer your holdings to a cold storage wallet, where it will be safest for the long term.
Using an online exchange like Coinbase and a cold storage wallet like the Ledger Nano S makes the process easy, straightforward, and secure. To be clear, there are many other options available for the purchase and safe storage of cryptocurrencies. We cover them in detail in our In-Depth section. Take a look and decide for yourself!
It’s likely that as technology evolves, newer, more efficient tools will hit the market. We will continuously update our resources to reflect the most advanced data and technologies available.
Congratulations! You can now explain cryptocurrencies to your grandma. If you are a grandma, you can explain cryptocurrencies to your grandkids.
If you want to take a deeper dive, head over to our In Depth section!
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