Growing Number of Ethereum Users Opt for Self-Custody Storage

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Ethereum, the cryptocurrency that succeeded Bitcoin, has made considerable progress in terms of price increases, updates to its blockchain, and overall solutions. With so many options to choose from when it comes to buying ETH, such as using a debit card, credit card, bank transfer, or third-party payment, it’s clear that it’s come a long way.

However, Ethereum still faces scalability and security issues that can lead to users losing all their assets if not stored properly. This is due to the lack of software solutions, as well as the lack of support for decentralized exchanges and digital wallets. This has led to an increase in demand for self-custody wallets, which give users control over their digital coins.

So, what is crypto self-custody? It means that users don’t rely on any type of storage system and choose to store their coins in a wallet where they manage the private keys and seed phrases. This practice is advantageous as it minimizes the chances of funds being affected if the third party used gets hacked, goes bankrupt, or gets involved in illicit activities. Hot and cold wallets are the two categories of self-custody wallets. Hot wallets are connected to the internet and designed for easy access, while cold wallets are used for long-term storage and come in physical or paper devices that can store private keys more efficiently.

To use a self-custody wallet, users must take certain security measures, such as choosing a reliable wallet provider, using an official hardware wallet, securing the seed phrase, enabling two-factor authentication, and being wary of scams. Furthermore, self-custody has benefits, such as it being censorship-resistant, safer, providing access to financial services in areas where banking services are scarce, and allowing users to manage their funds more efficiently. However, it also has drawbacks, such as users being solely responsible for their cryptocurrencies and it being more complex than using a crypto exchange.

As the crypto market is volatile and can yield both high returns and losses, it’s important to be prepared with more secure storage measures. Crypto users need to be able to recognize bear and bull markets in order to know when they should withdraw their funds and stay safe. Bear markets are characterized by a decline in the value of cryptocurrencies, a lack of investor confidence, and negative media coverage, while bull markets are identified by strong demand and low supply, overpricing, increased prices, and interest in cryptocurrencies among famous people.

Overall, self-custody wallets provide users with total control over their funds, but require specific technical knowledge and lead to limited functions. With the crypto market constantly changing, it’s important for users to be aware of the risks involved and be prepared with secure storage measures.

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