What is an online bitcoin wallet? – iNVEZZ

Also known as a web wallet, an online wallet is a way ofstoring your bitcoinon the internet. In other words, its a wallet that runs on your browser, just like a website. Online wallets are regarded as more vulnerable to hacks than other types of wallet, but they are very convenient as you can access your wallet anywhere as long as you have an internet connection.

Web wallets are designed to be very user-friendly. You begin by signing up with your preferred provider, which is simple and quick. You will then access your account with a username and password. Sending or receivingbitcoinis easy because all you need is your wallet address (for receiving money) and the address you want to send bitcoin to (for transferring out).

Yes, online wallets are very much like online banking portals for bitcoin. Like online banking, you can log on with your password and carry out transactions, see your balance, and look at your transaction history on the website of your wallet provider.

When it comes to bitcoin wallets there are a number of options from which to choose:

Yes, online wallets are completely free. All you need to do is choose your preferred provider, sign up, and start using your wallet.

There are no additional fees that you have to pay to the provider in order to use your online wallet. However, theres a small transaction fee charged when you spend bitcoin (but not when you receive it). These transaction fees are to pay the miners who verify the movement of bitcoin on the blockchain. Typically these are very low, usually around 0.2mBTC (which means two thousandths of a bitcoin under 2). Most wallets will also give you an option of paying a higher amount in order to motivate miners to verify your transactions faster.

There are many different web wallet services to choose from, heres a small selection of some of the best known:

Yes, you will find online wallets, such as Blockchain, that support a variety of different cryptocurrencies includingEthereumand bitcoin cash. The widest variety of coins, however, will usually be able to be held in web wallets that have integrated exchanges, such as Coinbase.

In some cases, online wallets are exchanges. If you use an option such as Coinbase, you can not only store your coins, but also buy andtrade other cryptocurrenciesthat are then automatically held in the wallet. Other online wallets that hold multiple currencies will often allow you to transfer different currencies between each other (for instance changing bitcoin into litecoin) within the wallet.

Yes, but exactly how will depend on your chosen platform. As a web wallet is like an online account, each company will have security features that allow you to gain access in case you forget your password. Wallets such as Blockchain allow you to set up your recovery seed and enter the 12-word recovery phrase when you lose your password in order to create a new wallet with your balance. Others such as Coinbase have an option for resetting your password, where you get an email with a link to set up a new password. Just to be safe, its better you write down your password somewhere and keep it safe in case you ever forget it.

Setting up an online bitcoin wallet is much like registering for an account on any other online service. Every provider will be slightly different, but usually this is how it will go:

Web wallets are the least secure type of wallet and are not recommended for storing anything more than a small number of bitcoins. The major risks associated with them are being targeted by hackers, as their servers will hold the information of a lot of different bitcoin wallets. This isnt to be alarmist, all online wallet providers will have strong security, but the risks are there.

The main advantage is being able to access your bitcoin wallet anywhere and on any device, provided you have an internet access. Also, the fact that many online wallets are exchanges means you can change your coins into othercryptocurrenciesand react quickly to market fluctuations to cash in on the profits.

It depends. Yes, if you want to be accessing your coins quickly for the purpose of making payments and exchanging; no, if you are looking for a safer option to store a large amount of coins. If your goal is long-term investment, you are better off with a hardware or paper wallet. An online wallet is only recommended for holding a small amount of bitcoin.

Right here. We have reviewed all the options to help you narrow down to the best online wallet for your needs. Go ahead and read through our reviews to find your perfect web wallet. Or continue to the next lesson.

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What is an online bitcoin wallet? - iNVEZZ