Even if blockchain-based products have been available on the market for some years now, many consumers still have some doubts about how certain chain mechanisms work. One of them is Blockchain Wallet, a digital product that brings several advantages to users who want to store and manage their coins like Bitcoin or Ether.
What is Blockchain Wallet and how does it work? Read this article to learn everything you need to know about Blockchain Wallet and the benefits it brings to individual users.
What is Blockchain Wallet?
Blockchain Wallet is a digital wallet (also called e-wallet) that lets users store and manage their coins. The product is actually provided by Blockchain.com, a software company founded by Peter Smith and Nicholas Cary.
The wallet basically allows making transfers and converting coins into local currencies like dollars or euros. At the moment, users can take advantage of Blockchain Wallet to manage the balance of two types of cryptocurrency: Bitcoin and Ether.
Note that the Blockchain Wallet charges dynamic fees. What does it mean? That the transaction fees can differ based on many different factors – for example, the size of your transaction. This is something every user needs to remember before using the Blockchain Wallet.
How does Blockchain Wallet work?
This type of digital wallet allows individual users to store selected cryptocurrencies. You can create a Blockchain Wallet free of charge. The account setup process is carried out online – all you need is an email address and password that you will be using to manage the account. You will get an automated email requesting confirmation.
Once the wallet is created, users get a special wallet ID. This is the unique identifier that is similar to an account number. The wallet’s holder can access the e-wallet by logging into the Blockchain.com website. Alternatively, they can download a mobile application and access their wallet using it.
The Blockchain Wallet interface always shows the current wallet balance for both Bitcoin and Ether tokens. It also shows the transactions completed recently.
But that’s not everything. Users can also click on the encrypted currency balance to see the value of the funds in the fiat or local currency of the user. This is the primary value of the wallet – you get instant information about the available funds and their value translated into the local currency of your choice.
How do you use Blockchain Wallet?
One of the key functionalities of Blockchain Wallet is that users can send a request to other people for a specific amount of Bitcoin or Ether. Once you do that, the system will generate a unique address that you can send over to the third party. Moreover, you can convert it into a quick response (QR) code for easier access. A QR code stores all the financial information and can be read by any digital device with a camera.
A new and unique address will be generated every time you make a request. Naturally, users can also send Bitcoin or Ether to other people when someone provides them with their unique address. The send-and-receive process works just like sending and receiving money on PayPal – only it uses crypt currency instead of local currency.
You can also exchange Bitcoin for Ether and vice versa. You will get a quote indicating how much you will receive based on the current exchange rate. The rate will be changing depending on how long it takes to complete the transaction. Note that exchanges never appear immediately in the wallet. That’s because it takes some time for transactions to be added to each currency’s blockchain. After all, this is what blockchain is all about.
Finally, users of Blockchain Wallet can also sell and buy Bitcoin through the interface. The service is powered by an exchange partner like Coinify or SFOX. Exchange rates are again guaranteed only for a limited period of time. To buy Bitcoin, you need to either transfer funds from a bank account or use a credit or debit card.
What are the Blockchain Wallet fees?
Here’s everything you need to know about the fees that Blockchain Wallet changes for different actions that you can take in your digital wallet.
First of all, bank transfers come with a small payment fee – for example, 0.25%. Note that it might take several days before you receive the Bitcoin you bought.
By using a credit or debit card, you will have immediate access to Bitcoin. However, that will incur a higher convenience fee – for instance, 3%. Moreover, buy and sell services might not be available in all the locations.
How do dynamic fees work?
Before you start using Blockchain Wallet, you need to understand the key characteristic of this product: dynamic fees.
Dynamic fees imply that the fee charged per transaction can be entirely different based on various factors like the type of the transaction or the conditions of the network at the time of the transaction. These two are usually the primary factors that impact the size of the fee.
Why is that? Because a limited number of transactions can be processed within a block by high-powered computers called miners. Miners usually process transactions with the highest priority first because it’s financially advantageous for them.
The good news is that Blockchain Wallet offers a priority fee. This means that your transaction can get process with one hour. You can also use the regular fee, which is cheaper but means that your transaction might take more than an hour to get processed. By that time, the exchange rate might look different than what you agreed on.
Naturally, the fees can also be customized. But if you set the fee as too low, the transaction might get rejected or delayed. This will prevent you from getting the exchange rate you were looking for.
Security in Blockchain Wallet
Security is a critical consideration for users looking to use an e-wallet for storing and managing cryptocurrency. If your account is illegally accessed, you might lose your Bitcoin or Ether. Fortunately, Blockchain Wallet comes with three levels of security.
The first level of security prevents you from losing your account access. It basically allows users to verify their email address and create a data recovery phrase of 12 words to use if they’ve forgotten password. Users can also set up a password hint. Remember that the wallet doesn’t store any passwords.
This level of security is all about preventing other users from gaining unauthorized access to your wallet. This includes linking a phone number to your account. You will receive a one-time password with the account is logged into your wallet. Two-step authorization is definitely a good practice.
The third level of security Blockchain Wallet offers allows you to block TOR requests. What are TOR requests? TOR is a global network of servers that lets users route their web traffic via multiple computers. The goal of this activity is to prevent anyone from tracing the origins back to the user. TOR can be used legitimately but also for harmful purposes – for example, hacking into a digital wallet anonymously since a trace could never identify the original user. Fortunately, as a user of Blockchain Wallet you have the option to block TOR requests.
Blockchain Wallet is on its way to becoming one of the go-to digital wallets for users interested in storing and managing cryptocurrencies.
Are you already using Blockchain Wallet? How is your experience so far? Is there anything you particularly like or dislike about this solution?
Please share your thoughts in the comments section; we’re curious to hear how people are using Blockchain Wallet to navigate the crypto world.