If you own Bitcoin, then a crucial step is to know how to safely store it in order not to lose your investments to a hack, malware attack, phishing, or other threats that are prevalent. An investor can decide to store their asset online, offline, or on their phone. In the case of the latter, there are several benefits of owning a Bitcoin wallet on a smartphone.
Bitcoin can be stored online and offline and each has an advantage over the other. While online storage is most suitable for new users in the community to teach them how Bitcoin transactions work, offline storage is known to be more secure. Likewise, if you want to buy bitcoin now, then one of the first places is on virtual exchanges.
On the other hand, storing Bitcoin on a smartphone comes with several benefits. Some of these include easy accessibility, faster transactions, and a secure platform to store, send and receive funds.
Ease in Accessing Funds Stored in a Mobile Wallet
When it comes to accessibility, you can check the status of your wallet with ease. If you’re a person who is always worried about the market prices and need to know if your assets are gaining some worth or devaluing, then you’ll find a mobile wallet very useful. All that is required, is to enter your wallet’s password or Google Authenticator key and then access is gained.
Another advantage of storing Bitcoin on a phone is that it makes for faster payments. Think of it this way, with the virtual asset next to you, you can order food online, pay utility bills and taxes, buy a beer, and also shop for jewelry. This will take lesser time compared to cold storage which requires you to insert the hardware into a computer. Lest we forget, certain wallets ensure that you can buy Bitcoin using a credit or debit card right from your phone.
A More Secure Storage for Bitcoin
One more advantage is the secure nature of transactions carried out from a phone. According to Joel Snyder, a senior IT consultant, the use of a smartphone is safer in comparison to laptops and computers. In his opinion, most phones feature a
native environment called Trusted Execution Environment (TEE).
The TEE in these phones works in a separate environment with its own memory which differs from that used by the phone. As such, if the smartphone gets hacked, it will be difficult for an attacker to pass through the device’s operating system to get the wallet’s private key since the TEE works independently.
Risks Associated with Storing Bitcoin on Mobile Wallets
Despite these benefits, storing Bitcoin on smartphones also come with its own disadvantages. One of such is the security threats posed through hacks. As Synder pointed out, if the phone itself lacks the hardware-based TEE, then it will still be vulnerable to attack.
In Synder’s own words:
This is why smartphones have an edge over laptops and desktops for cryptocurrency wallets: without the benefits of the hardware-based TEE, the keys are more vulnerable.
Another potential risk of using mobile wallets is that the application could be a malware that has been programmed to send the user’s private key to a server. As such, funds held within it can be lost. An instance is the case of the Coinomi wallet which allegedly sent a user’s private keys to Google’s spell check service.