Understanding the Importance of Private Key Security in DEX Trading: A Guide
In the dynamic world of decentralised finance, safeguarding your private key is of big importance. Let’s dive into the essentials and explore how TokenSight allows you to trade securely with Self-Custodial wallets.
What is a Private Key?
A private key is a lengthy code, which works like a password, and signs transactions. Wallets generate private keys, which are then used to create the corresponding public key (wallet address) through cryptographic operations.
Where is Your Private Key Stored?
Software Wallets (e.g., Metamask) store the private keys locally on your device and are exportable. On the other hand, hardware wallets (e.g., Trezor) store the private key on the hardware device and are non-exportable, while the transactions are signed within the device. Remember, whoever holds the private key controls the associated funds.
Trading on DEXes
Every on-chain operation, like transferring tokens or ETH or trading on DEXs like Uniswap, requires signing transactions with your wallet.
Performing these operations while trading has to be done very quickly, and signing a transaction using a hardware wallet would often lead to a lost opportunity in capturing the best price.
DEX Trading Platforms and Wallet Integration
DEX trading platforms facilitate on-chain trading and automate tasks. Using personal wallets on DEX trading platforms is a tedious task, while integrated platform wallets streamline execution even while you sleep. Importing your private key in a DEX trading platform exposes you to a significant risk — the key will be stored in their database, encrypted or not, and any hacking event will likely result in you losing your funds.
Introducing Self-Custody Wallets on TokenSight
Your private keys are not stored on TokenSight servers, but in a secure vault managed by Turnkey, which is only accessible by you.
Exporting your keys directly from the vault ensures no third-party access. While trading, you only authorise TokenSight with limited permissions to sign transactions on your behalf, and you can revoke the authorisation anytime. You can consider this as a trading session, which you can open or close anytime.
Due to the private keys being stored in this Vault and only accessible by you, even in unfortunate case of TokenSight being hacked, your funds cannot be transferred to another address.
Trade Safely on TokenSight
Importing keys on any platform exposes your wallet and funds to risks.
Setting up a Self-Custodial wallet for DEX trading on TokenSight gives you complete control over your funds while streamlining your trading operations.
Always Trade Safely.
About TokenSight
TokenSight is a DEX trading platform that enables secure and efficient trading with features such as trade orders, copy trading, sniping and alerts.
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