Hello Everyone.
Welcome to Steemit Crypto Academy Season 3. After a long time, I wanted to start my first homework with professor @allbert homework. The professor gave a nice lecture on the subject of wallets and Exchanges, which almost all of us know a little about.
I wish everyone who reads my homework already have a nice and healthy day.
1- Explain differences between wallets and exchanges as well as mention which operations should be performed in an Exchange and which operations should be performed in a wallet (in terms of fees).
Wallets and exchanges are different. We can briefly explain this as follows. Wallets allow us to store and accumulate our assets. Exchanges allows us to trade with our assets. Although there are similarities between the two, there are more differences.
The main difference between them, in my opinion, is security. Because Wallets is completely under user control. It is closed to anyone else's access in any way and its reliability is very high thanks to private keys. Exchanges, on the other hand, is not fully under user control. No private key is given to the user by the exchanges. Exchanges have a centralized system. Since wallets are decentralized systems, we can say that wallets are more secure.
The centrality of the exchanges causes it to face many security problems. The most prominent of these is the hacking of exchanges. As his professor mentioned, many exchanges have had this problem in the past.
Another difference between wallets and exchanges is the interface difference. The use of wallets is a little more difficult than the use of exchanges. At the same time, exchanges that allow us to do our instant trade have their own wallets. Although exchanges have easy access and a user-friendly interface, they are not a place where we can store all of our assets. We do not store our assets in our wallets.
2- In your own words, Why You think people should have more than one exchange account?. Do you have an exchange account? and Why that specifically?
If you are new to cryptocurrency trading, you can trade on a single exchange until you improve yourself. But if you are a real trader it is better to use multiple exchange accounts. The reason for this is that each exchange has different characteristics. Many exchanges have different transaction fees. During your trading, you should use the most suitable exchange according to your trade. Not every exchange lists every cryptocurrency, so we may need to use different exchanges during our trading.
Putting aside the characteristics of all exchanges, we should not keep our assets in one exchange. As we said before, Exchanges can always pose a problem in terms of security. Therefore, when we are faced with any security problem, we do not lose all of our existence.
Although I have an account in many exchanges, I generally provide my transactions through Binance and FTX exchanges. Since Binance is a more popular exchange, I use Binance to convert my transfers and crypto assets into local currencies. I do my trades on the FTX exchange. The reason for this is that the FTX exchange offers the opportunity to trade directly in dollars. In this way, I can get more consistent profits in my trades.
3- What are better? Wallets or exchanges.?
I can't say either one is better, separating wallets and exchanges from each other for one reason only. Because they both provide different features and possibilities. As I said before, of course, I store my assets in wallets, but since wallets do not allow us to trade in general, we also have to use exchanges.
So it wouldn't be right to say that Wallets or exchanges are better. For cryptocurrency traders, Wallets and Exchanges are like two wheels on a motorcycle. You cannot move unless both wheels turn. So we have to use both for our security and our ability to trade.
However, if we consider that we do not trade and only buy cryptocurrencies for savings and investment, of course, we should think of Wallets. Because Wallets are decentralized systems and completely under our control.
In addition, some wallets offer the opportunity to trade. However, this trade does not have a wide range as in the Exchanges.
4- Create an account in a wallet and in an exchange of your choice and show screenshots of the process.
FTX Exchange:
- First, we enter the FTX https://ftx.com/ site through our browser.
- Then we click on the "REGISTER" option from the area I indicated with the box.
- Then we click on the "Sign In" option from the menu that appears.
- Then we fill in the e-mail and password sections, tick the checkbox and click the "Sign UP" button.
- Then our account is opened easily.
- Then we need to give an e-mail confirmation and register our identity information in the system for security purposes so that we can take any action. If we do not, our transactions will be limited.
Binance Chain Wallet:
- First, we enter the Google web store, as I will show it through Google chrome.
- Then we write Binance Chain in the search section.
- Then we add the extensions by clicking the Add to Chrome option.
- Then we click on the option to create a wallet.
- Then we click on the "Create seed expression" option.
- Then we set our password.
- Next, we save the words given to us and re-enter the words when asked.
- And we open our account.
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Conclusion
At the end of this lesson, we learned how to store and trade cryptocurrencies that are popular today. We learned what purposes wallets and exchanges serve and how they are used. By opening an example account, we showed how easily we can have both a wallet and an exchange account.
I think cryptocurrencies will become more popular in the coming years. Therefore, there are many points that we should pay attention to when investing and trading. As long as we pay attention to these points and follow the developments, we must protect our assets well.