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A spate of recent hackings at worldwide bitcoin exchanges demonstrates the need to hold funds for betting in a secure wallet.
Exchanges should only serve to convert cryptocurrencies. They should not be used for storing funds. Bitcoin and other cryptocurrencies should be held in the downloaded wallet.
The wallet also adds a layer of anonymity when placing bets online. Most exchanges stipulate their platform is not to be used for gambling, regardless of whether the activity is legal in your physical location. Moving money between a wallet and exchange is akin to a customer/bank relationship whereby the bank does not ask, nor does it typically have any interest in, what the money you are withdrawing will be used for. Few banks, however, will deal directly with the gambling establishment directly.
In the online world, a cryptocurrency wallet is like a bank account. An exchange is no different than the currency exchange one finds upon arriving at an airport.
The Bitcoin Wallet is among the most popular to download. This one utilizes multisig technology for increased security.
- Aaron Goldstein, Gambling911.com
