There are many ways to improve your Bitcoin trading experience. Besides making your transactions more convenient and secure, you should also transition from legacy addresses. That’s where address converters come into play.
In this entry, we’ll describe the basics of a Bitcoin address converter. Canada cryptocurrency owners depend on this practical tool, and you’re about to find out why.
What Is a Bitcoin Address Converter and Why Is It Beneficial?
Sending and receiving your Bitcoin requires a wallet address that consists of 26-35 characters. You can transfer cryptocurrency to any address on the network, but you can face several problems if you’re using a legacy address. Primarily, the fees are higher, and the transactions may take longer to complete.
Address converters solve these problems. As the name suggests, they convert your legacy address into something less expensive and more compatible.
As for the recommended format, your best bet is to switch to SegWit addresses. This protocol was introduced four years ago and helped cryptocurrency transactions scale up while resolving certain bugs. It resulted in faster and safer transfer.
Before SegWit addresses were launched, cryptocurrency was prone to malleability. In other words, the transaction information could be altered before the network approved the transfer, creating bookkeeping problems.
SegWit resolved this issue by allowing signature data to be kept outside transaction blocks, but it still verified the data. Consequently, transfer integrity was preserved, and individual blockchain blocks were enlarged.
On top of that, SegWit enabled owners to keep track of their Bitcoins spent more easily. They can look them up using their txid (transaction identifier). This feature makes them superior to legacy addresses that require wallet owners to use extra code to deal with altered identifiers.
Setting Up SegWit Wallets
Since SegWit addresses are the preferred type of address, you’ll also want to use a SegWit wallet. The easiest way to check what kind of wallet you’re using is to look at the first number of your address.
If it begins with “1,” it’s a legacy platform. By contrast, you’ll know you’re running a SegWit wallet if the first digit is “3” or a “bc1” alphanumeric combination. The latter is an even better choice because it helps reduce the blockchain load even further.
Naturally, you’ll need to look for brands that support SegWit addresses when choosing your wallet. For instance, MetaMask and Coinbase are non-custodial wallets that give you total control over your funds. They don’t rely on third parties to secure your assets, meaning the responsibility of protecting your password falls on you.
Here’s how setting up a non-custodial wallet works:
- Download your wallet app and create an account. You shouldn’t be required to share your email address or other personal information.
- Write down the private key displayed as a 12-word phrase. Store it safely, as losing this key will prevent you from accessing your Bitcoin.
- Transfer currency to the wallet. Make sure to familiarize yourself with the transferring process beforehand since you may not be allowed to purchase Bitcoin with traditional currencies.
If you prefer something other than non-custodial wallets, you can opt for hardware platforms. These physical devices are similar to USB drives, and they store your private keys offline, making them more secure. Therefore, your Bitcoin will remain off-limits to other people even if your PC is hacked.
Setting up your hardware wallet goes as follows:
- Buy your hardware.
- Install your software necessary to set up the wallet. Download it from the official web page and install it according to the instructions.
- Transfer the currency to the wallet. Like non-custodial wallets, hardware platforms may not let you purchase Bitcoin with traditional currencies. Therefore, you’ll need to transfer it to your wallet.
Even though hardware wallets are secure, you can’t be reckless with your information. You need to use a strong password. Instead of entering your name or birth date, come up with an elaborate alphanumeric combination and write it down. Keep the code in a safe location and don’t share it with anyone.
Reap the Benefits of Enhanced Addresses
You can dramatically optimize your cryptocurrency experience with a well-made Bitcoin address converter Canada users who have switched to SegWit addresses enjoy higher speeds and more secure transactions, offering peace of mind. You need only choose a suitable wallet and follow recommended safety protocols to make the most of your transition.