How to Send Crypto – Easiest Guide to Transferring and Storing Digital Assets in Your Own Wallet

Some people do ask themselves, is it safer to keep crypto on an exchange or a wallet? Or, what is the point of transferring crypto to a wallet? Well, “Not your keys, not your cryptos”, what does it really mean? As described in a previous lesson: Public and private keys are an integral part of cryptocurrencies. They allow you to send and receive cryptocurrencies without requiring a third party to verify the transactions. A public key allows you to receive cryptocurrency transactions. It’s a cryptographic code that’s paired to a private key. While anyone can send transactions to the public key, you need the private key to “unlock” them and prove that you are the owner of the cryptocurrency received in the transaction. The public key that can receive transactions is usually an address, which is simply a shortened form of your public key.

After reading this guide you know:

• How to send crypto
• How to receive crypto
• How to store crypto

Step 1 – Choose between a hardware wallet or software wallet

A hardware wallet and a software wallet are two different ways to store your digital assets, such as cryptocurrencies. Here are some of the key differences, pros, and cons of each:

Hardware Wallet

A hardware wallet is a physical device that stores your private keys, the essential piece of information needed to access and spend your cryptocurrency.

Pros:

• High level of security: Hardware wallets are generally considered to be the most secure way to store cryptocurrencies. They are offline devices, which means that they are not connected to the internet, making them less vulnerable to hacking attempts.
• Easy to use: Hardware wallets are typically easy to set up and use, with straightforward instructions provided by the manufacturer.
• Portability: Hardware wallets are small and portable, so you can carry them with you wherever you go.

Cons:

• Cost: Hardware wallets can be expensive, with prices ranging from $50 to $200 or more.
• Limited functionality: Hardware wallets are primarily designed for storage, so they may not have all the features that you would find in a software wallet.
• Risk of loss: If you lose your hardware wallet or it gets stolen, you will lose access to your cryptocurrencies unless you have a backup seed phrase.

A backup seed phrase (also known as a recovery phrase) is a string of words that are used to recover access to your cryptocurrencies in case you lose access to your hardware wallet or software wallet. It is a critical piece of information that you must keep secure and private, as anyone who has access to your seed phrase can access your funds.

When you first set up your hardware wallet or software wallet, you will be prompted to create a backup seed phrase. This phrase typically consists of 12, 18, or 24 words in a specific order, randomly generated by the wallet software. It is important to write down the seed phrase on a piece of paper and store it in a secure location, such as a safe or a lockbox.

If you ever lose your hardware wallet or forget your password for your software wallet, you can use your seed phrase to restore access to your funds. Simply enter the seed phrase into a compatible wallet application, and it will generate the private keys needed to access your cryptocurrencies.

It is important to keep your seed phrase private and secure. Never share it with anyone, and do not store it in a digital format, as it could be vulnerable to hacking attempts. Additionally, it is a good practice to keep multiple copies of your seed phrase in different secure locations in case one is lost or damaged.

Software Wallet

A software wallet is an application that you download onto your computer or mobile device that allows you to store and manage your cryptocurrencies.

Pros:

• Free or low cost: Software wallets are generally free to use or have a low cost.
• More features: Software wallets may offer more features and functionality than hardware wallets, such as the ability to exchange one cryptocurrency for another.
• Accessibility: Software wallets can be accessed from anywhere with an internet connection, making them more convenient for day-to-day use.

Cons:

• Less secure: Software wallets are more vulnerable to hacking attempts than hardware wallets because they are connected to the internet.
• Requires more technical knowledge: Software wallets may require more technical knowledge to set up and use.
• Vulnerable to malware: Software wallets can be vulnerable to malware and viruses, which could compromise your private keys and lead to loss of funds.

In summary, hardware wallets are generally considered to be the most secure way to store cryptocurrencies, but they can be expensive and have limited functionality. Software wallets are more convenient and accessible but may be less secure and require more technical knowledge to use. Ultimately, the choice between a hardware and software wallet will depend on your individual needs and priorities.

There are many hardware and software wallets available on the market, and new ones are being developed all the time. Here are some of the most popular and widely used wallets:

Hardware wallet examples:

1. Ledger Nano S/X: The Ledger Nano S/X is a popular hardware wallet that supports a wide range of cryptocurrencies, including Bitcoin, Ethereum, and many more. It features a secure chip and a simple user interface, making it a popular choice among cryptocurrency enthusiasts.
2. Trezor: Trezor is another popular hardware wallet that is known for its security and ease of use. It supports a wide range of cryptocurrencies and features a PIN code and a recovery seed phrase for added security.
3. KeepKey: KeepKey is a hardware wallet that supports over 40 cryptocurrencies and features a large, easy-to-read screen for displaying transaction details.

Software wallet examples

1. Exodus: Exodus is a popular software wallet that supports a wide range of cryptocurrencies and features a sleek and user-friendly interface. It also includes a built-in exchange feature for trading cryptocurrencies.
2. MyEtherWallet: MyEtherWallet (MEW) is a popular software wallet designed specifically for Ethereum and Ethereum-based tokens. It is an open-source wallet that allows users to create and manage their own wallets with full control over their private keys.
3. Atomic Wallet: Atomic Wallet is a multi-currency software wallet that supports over 500 cryptocurrencies. It features a simple and user-friendly interface and includes a built-in exchange feature for trading cryptocurrencies.

It is important to note that this is not an exhaustive list and that there are many other hardware and software wallets available. When choosing a wallet, it is important to do your research and choose a wallet that best fits your needs and priorities. Additionally, it is important to ensure that you use reputable wallets that have a track record of security and reliability.

Step 2 – Accessing your wallet

There are different ways to access your wallet, which also depends on what type of wallet you have. This section will elaborate on two wallets, being the Ledger Nano S (hardware wallet) and MetaMask (software wallet, extension in Google Chrome). For the remainder of this document we assume that you went through the steps to setup/ install your wallet.

First, you need to know which wallet (on which chain, i.e. Bitcoin, Ethereum, Binance, etc) you want to access. Let’s use TRAC (OriginTrail) as an example. You can look up the contract address of any coin on coinmarketcap.com or coingecko.com. Look at the green arrow in the screenshot below.

As you can see, it’s an Ethereum contract. What does that in short mean for your asset transfers? You will need to send your TRAC tokens to your Ethereum address. You can send many different assets that are on an Ethereum contract to this same Ethereum address (on which we will elaborate shortly). Within your wallet, it will be recognised that those are different assets.

Here’s a step-by-step guide on how to access your Ethereum wallet with a Ledger Nano S:

1. Connect your Ledger Nano S to your computer using the USB cable provided.
2. Enter your PIN code on your Ledger Nano S device to unlock it.
3. Open the Ledger Live app on your computer and ensure that your Ledger Nano S is connected and unlocked.
4. In the Ledger Live app, click on the “Manager” tab at the bottom of the screen.
5. Find “Ethereum” on the list of available cryptocurrencies and click on “Install.”
6. Once the Ethereum app is installed on your Ledger Nano S, open the Ethereum app on your device.
7. In the Ledger Live app, click on the “Accounts” tab at the bottom of the screen.
8. Click on the “Add Account” button and select “Ethereum” from the list of available cryptocurrencies.
9. Follow the on-screen instructions to complete the setup process, which will include verifying the Ethereum address displayed on your Ledger Nano S device.
10. Once your Ethereum account is added to the Ledger Live app, you can view your balance and transaction history, as well as send and receive Ethereum.

That’s it! By following these steps, you should be able to access your Ethereum wallet with your Ledger Nano S.

Step 3 – Receiving digital assets

Tokens, like TRAC, that run on the Ethereum blockchain are called ERC20 tokens. Here are some simple steps to follow to receive ERC20 tokens from an exchange (like Binance) to your Ledger Nano S:

1. Connect your Ledger Nano S to your computer using the USB cable provided.
2. Unlock your Ledger Nano S device by entering your PIN code.
3. Open the Ethereum app on your Ledger Nano S.
4. Log in to the exchange where you hold the ERC20 tokens and go to the “Withdraw” or “Send” section of the platform.
5. In the “To Address” field, paste the Ethereum address associated with your Ledger Nano S. Make sure to double-check that the address is correct, as sending tokens to an incorrect address can result in permanent loss of your tokens. Among known mistakes are: people send it to a wrong wallet or they accidentally send assets to the contract address of the asset itself.
6. Enter the amount of ERC20 tokens you wish to withdraw or send to your Ledger Nano S address.
7. Double-check the transaction details, including the address and the amount, to make sure everything is correct.
8. Click on the “Send” or “Withdraw” button to initiate the transaction.
9. Wait for the transaction to be confirmed on the Ethereum blockchain, which can take a few minutes to an hour depending on the current network traffic. If you go to the withdrawal page, you can usually find a link to the transaction page. Here you can track the confirmations on the network.
10. Once the transaction is confirmed, you should see the ERC20 tokens in your Ledger Nano S wallet.

By following these steps, you should be able to receive ERC20 tokens from an exchange to your Ledger Nano S. It’s important to note that you always double-check the transaction details before confirming any transaction to prevent errors.

Step 4 – Sending digital assets

Here are some simple steps to follow to send ERC20 tokens from your Ledger Nano S:

1. Connect your Ledger Nano S to your computer using the USB cable provided.
2. Unlock your Ledger Nano S device by entering your PIN code.
3. Open the Ethereum app on your Ledger Nano S.
4. Log in to your wallet or exchange where you hold the ERC20 tokens you wish to send and copy the Ethereum address of the recipient.
5. Open your Ledger Live app on your computer and select the Ethereum account that holds the ERC20 tokens you wish to send.
6. Click on the “Send” button and enter the amount of ERC20 tokens you wish to send.
7. Paste the Ethereum address of the recipient in the “To” field.
8. Choose the appropriate transaction fee. Keep in mind that you will need to have some Ethereum (ETH) in your Ledger Nano S account to pay for the transaction fees.
9. Double-check the transaction details, including the address and the amount, to make sure everything is correct.
10. Click on the “Send” button to initiate the transaction.
11. Wait for the transaction to be confirmed on the Ethereum blockchain, which can take a few minutes to an hour depending on the current network traffic.
12. Once the transaction is confirmed, the ERC20 tokens should be sent to the recipient’s address.

You should always double-check the transaction details before confirming any transaction to prevent errors. Also, make sure you have enough Ethereum in your account to cover the transaction fees.

If someone now asks you “how to send bitcoin from Coinbase to another wallet?”, you can help this person out!