FAQ

When you first buy cryptocurrency, you’re issued with two keys: public and private.
A public key serves as an address that can be shared with other parties to receive transactions. To make things simpler, we can compare a public key with a bank account number you can share with third parties without worrying that your assets will be compromised.
On the other hand, a private key represents a randomly generated number that signs transactions and allows you to spend your funds. As a last line of defense, a private key protects your assets from malicious actors and unauthorized access. If it gets compromised or lost, you won’t be able to access your wallet to spend, withdraw, or transfer coins.
In other words, owning crypto assets comes down to managing and securing your private keys.
To safeguard and keep track of your keys, you can use online or offline wallets. Online wallets, also known as hot wallets, store private keys on systems or devices that are connected to the internet. Hot wallets are easy and convenient to use, however, they come with several drawbacks. Besides being susceptible to attacks and a honeypot for hackers, with hot wallets, the custody of private keys is often entrusted to a third party such as a crypto exchange, which means you never have full control over your funds.
The safer choice are specialized hardware wallets that store private keys offline. Stealing private keys from a hardware wallet would require physical access to the wallet and corresponding PIN or the recovery phrase. What's more, with hardware wallets, you don’t need to rely on third-party custodians.
Software wallets store private keys on systems or devices that are connected to the internet, making them susceptible to all kinds of attacks.
Holding your crypto on an exchange means entrusting the private keys to a third party and losing full control of your funds.
Ledger devices store your private keys on a Secure Element chip and provide full isolation between the keys and your computer/smartphone to give you complete control over your assets.