Wallets vs. Exchanges: Know the Difference

[Nomad]

Newcomers to the crypto market often confuse wallets with exchanges, but they serve very different purposes. The primary use of wallets is to store your assets, and the primary use of exchange is to buy sell and trade. If you use self custody wallets, you get more security but most exchanges are custodial and you are depended on the platform you are using. You can control your wallet but not the centralized exchanges. Wallets are basically used for long term holding or sending and receiving crypto, exchanges are for trading and exchanging.

 

[Lolita]

Wallets store your crypto securely, giving you full control. Exchanges let you trade but often hold your keys, making them riskier. Use wallets for holding, exchanges for trading.

 

[Nomad]

Using exchanges can be risky because you are prone to hacking but exchanges also allows you to trade and earn rewards on your assets.