One of the things that’s great about Bitcoin is the security that it provides its users. You hear about banks getting robbed or credit card companies being hacked, which can not only take customers’ money but can also compromise their personal information. When Bitcoin is used wisely to make a transaction online, it provides the utmost security to the user. None of the person’s financial or personal information is revealed, and only as much money that is supposed to change hands does. It’s an ideal situation. But the problem is that not all customers use Bitcoin wisely; that is, not everyone does so with the help of their own dedicated Bitcoin wallet. Not having one opens you up to the kinds of problems that are inherent with traditional forms of buying and selling.
A Bitcoin wallet is an instrument by which a consumer either doles out coins to another user or receives them. By using a key, which is a series of numbers and symbols, that is only known to them, the user can ensure full protection is afforded by their transaction. Taking the easy, or lazy, way out, is a recipe for disaster. If you’d like to invest in Bitcoin, the smart way to do it is by using a clever trading program like Bitcoin Trader. If you want to store it and use it, a wallet that you purchase, preferably a piece of hardware, is the best way to go, for the following reasons.
The Exchange Hack
If you put your coins in an exchange, you are doing the same thing as putting your money in a bank, in that you are turning over the responsibility for your capital’s protection to a third party. Hackers aren’t generally going to bother with individual wallets, but they will surely target a coin exchange stocked with Bitcoin wealth.
Your Wallet’s Security
When you make a transaction right from your wallet, all your information is kept secret, even from the person with whom you are conducting the transaction. Only you know your key (and you should ideally keep that information on a sheet of paper hidden away in your place of residence), which means only you will have access to the stuff that you want to keep hidden.
More Security, More Bitcoin
If you are a Bitcoin adopter, you obviously would like to see it continue to gain in popularity, thus driving the value skyward. Every successful transaction is another feather in the Bitcoin cap, while each instance of an exchange hack works against it. It might not seem, on a micro level, like your dealings will make much difference in the grand scheme of things for the Bitcoin phenomenon. But proving to people that Bitcoin transactions can go as smooth as they are purported to be will strengthen the cause of the coins.
If you are going to purchase or deal in Bitcoins, you really should invest in a solid digital wallet. It’s the safe, smart way to go about it.