The crypto wallets do not store your keys. Your holdings are on the block chain. And as you know, you require multiple passwords to open a block chain, it is humanely impossible to hack a block chain. For this reason, the crypto wallets are completely safe. Let us dig more and learn why crypto wallets are safe. But before that, you need to learn certain basics of crypto wallet.
What is a crypto wallet?
Crypto wallets are used to store pass keys. The first crypto wallet was introduced by Satoshi Nakamoto. He was a developer of Bitcoin. The second crypto wallet was developed by Hal Finney. Slowly, several other crypto tycoons started launching their own wallets. These wallets come with high security features and are therefore are completely safe.
Why are crypto wallets safe?
The crypto wallets offer, QR codes, storage option in exchanges, controlled internet connection, self-ownership, offline storage options etc. Some of the crypto wallets have all these security features. While some other offer a few of these. So, before you select the wallet, you should look into the security features of the wallets.
QR code is Quick Response. It is a bar code with optical label with which you can track, locate and identify the points of an application or a website.
Storage option in exchanges
Some of the exchanges offer digital storage like DAS. These storages are directly attached to the workstations. There is no storage network involved. Therefore, they are highly safe and secure. The storages in exchanges like that of DAS uses SCSI and ATA to store the keys. This makes the system hack proof. SCSI is Serial Attached Small Computer System Interface. ATA is Serial Attached Advanced Technology Attachment.
Crypto Wallet Security
Crypto wallets are the highest target for the hackers. Hacking one wallet gives them opportunity to earn billions and billions of money. Therefore, to protect their wallets from the hackers, the crypto companies build several security features. Some of them are two-factor authentication, seed words, authenticator app, etc.
Two factor authentication
This is an authentication method used to verify the user identity using two or three factors. The first factor can be a passcode and the other factor can be a finger print or a code sent to your phone, etc.
The seed words are also called seed phrase. The crypto wallets generate the seed words during installation. They can then be used as emergency back up when you want to restore access.
The seed words are a collection of 12 words or 24 words. They can be meaningful sentences or random words.
The Bit coin uses BIP39. The BIP39 stands for Bit coin Improvement Proposal 39. The BIP39 consists of 2048 sets of seed words.
Why are seed words safe?
The seed words are split into multiple parts and are stored in different deposit boxes. Some crypto companies use block chain to store these seed words.
I have given you the top reasons of why a crypto wallet is safe. Hope my article was useful!