Just like your real-life assets, it's crucial to secure your digital assets like non-fungible tokens (NFTs) as soon as you own them. With criminals trying different ways to scam and get access to your accounts, it's best to keep up with the latest and safest crypto wallets.
Crypto wallets are essential for buying, selling, and storing digital assets if you're pretty new to owning digital assets. Aside from validating and protecting transaction information, crypto users like you will need the safest crypto wallets to secure their digital assets. One of the safest ways to keep your non-fungible tokens is by using hardware wallets like Ledger and Trezor, which act as cold wallets.
Why store your non-fungible tokens in a cold wallet?
First, let's differentiate between cold wallets and hot wallets. Cold wallets are offline and are not connected to the internet, thus making the digital assets stored highly secure. On the other hand, digital assets in hot wallets are connected to the internet, making them highly accessible to the owner.
Most non-fungible tokens marketplaces require crypto users to have a hot wallet, such as MetaMask, where you can instantly create an account on the platform. However, because a hot wallet is connected to the internet, you are more vulnerable to phishing and hacking attacks. Therefore, even if hot wallets allow you to make regular transactions on non-fungible tokens marketplaces more conveniently, you can improve security by using cold wallets.
The great thing about cold wallets is that they are compatible with non-custodial hot wallets like MetaMask. This means you're able to easily trade digital assets from within the security of your device. Each time you initiate an action, the MetaMask wallet will send a request to your cold wallet.
The transaction will only proceed when you've physically signed or approved the request using the private key in your cold wallet. What's most important is that no one will be able to steal your non-fungible tokens while you have your cold wallet.
Here's how to secure your non-fungible tokens
Most non-fungible tokens marketplaces require traders to have a hot wallet, where you can instantly create an account on the platform. However, bear in mind that since the hot wallet is connected to the internet, it could be vulnerable if you’re not careful.
Nevertheless, hot wallets allow you to make regular transactions on non-fungible tokens marketplaces more conveniently.
Meanwhile, cold wallets provide the utmost security by keeping your private keys disconnected from the internet. However, this will make it a bit hard for you to directly buy or sell non-fungible tokens on marketplaces.
We've already mentioned the pros and cons of each wallet, so which one should you choose? You might want to consider using a mix of both to ensure the ultimate security and convenience. Here's an example:
With a cold wallet like Ledger and Trezor, you can easily link it to a trusted third-party hot wallet like MetaMask. By connecting your cold wallet to MetaMask, the private key that controls your non-fungible tokens will remain in your hardware wallet, safely stored in its secure element chip.
At the same time, your balance can be monitored and managed by your hot wallet. This means you're able to easily trade digital assets from within the security of your device. Each time you initiate an action, the MetaMask wallet will send a request to your cold wallet.
When it comes to securing your non-fungible tokens, cold wallets like Ledger and Trezor are the most popular choices as the safest crypto wallets to use. Cold wallets employ a unique digital security ecosystem that provides protection and is built on verifiable trust across users, hardware, and software.
As a result, they are essential to safeguard digital assets for crypto enthusiasts, especially if their holdings are substantial. Digital assets connected directly to the internet (via hot wallets) can be stolen or compromised. Therefore, cold wallets can minimise risks like these so that they can continue to explore the crypto world safely.
Now you know how to store your non-fungible tokens, here are some recommended next steps you can take:
Purchase Ethereum (ETH) from Luno
Set up a MetaMask account which is secured via a cold wallet
Transfer your ETH from Luno to Metamask
Purchase your preferred non-fungible tokens from marketplaces such as OpenSea
Read more on Luno's Terms of Use and risks associated with cryptocurrencies here: www.luno.com/en/legal/terms.
Do you have friends/family who have not signed up for an account with Luno in Singapore? Refer them and enjoy ~MYR 90 (SGD 30) in Bitcoin!
Steps to invite your friends
Share your unique invite code to your friend from the Rewards Page
Your friend signs up, deposits and buys SGD 200 of crypto
You both get SGD 30 (~MYR 90) worth of free Bitcoin
*T&C: https://www.luno.com/en/legal/rewards-and-promotions
This article is for educational purposes only, and you should not construe any such information as investment or financial advice. Investing in cryptocurrency is high risk and may result in capital loss as the value can fluctuate. We recommend individuals consult with a licensed financial planner for detailed financial advice on whether cryptocurrency is a good investment option.
