What is a Crypto Wallet? And Why You Need One
“Not your keys, not your crypto” is a phrase that has been rattling all the corners of the Web3 space in recent months… but what does it actually mean? To understand this, we must take a trip back to the year 2009. In 2009, a set of nameless engineers under the alias “Satoshi Nakamoto” created the concept of Bitcoin, the world’s first engineered monetary system. After the financial crisis in 2008, these engineers decided “enough is enough”, and through the power of the internet and cryptography, Bitcoin was born. Since 2009, many other cryptocurrencies have been created, each serving its own utilities and purposes. Cryptocurrencies were created to give power back to the people and give every single person on Earth a right to own assets. Crypto allows the average person to self-custody their own money and assets without having to rely on banks, government, or other middleman services that created these financial crises in the first place.
Buying cryptocurrency on an exchange is one thing, but being in the custody of your crypto is a whole different story. When purchasing crypto on an exchange, you are simply trading one currency for another (ex: fiat to crypto exchange, crypto to fiat exchange, crypto to crypto exchange). Exchanges will be custody of your crypto on their platform until you withdraw your assets into fiat or crypto. The issue with leaving money on exchanges is that if something were to happen to the exchange, your money could be locked up and disappear along with the exchange. Due to the recent economic downturn, many of these exchanges have found themselves over-leveraged, causing them to close their doors for good. This is where the phrase “not your keys, not your crypto” sprouted from. Unless you hold the keys to your wallet for crypto, you are not in the custody of your own assets. It is extremely important to be the sole owner of these keys on your crypto hardware wallet. Many of us still have a lot to learn in this new world of Web3. Making mistakes along the way is a natural part of the process, but WAGMI! We have been given this gift of freedom to be in control of our own future and assets. Let’s not waste it. It all starts with security.