The Best Cryptocurrency Wallets
Cryptocurrency is becoming more and more mainstream in popular consciousness. Whether you’re someone who bought a few bitcoins during the boom in 2017, or if you’re a more seasoned digital currency trader, the same concerns apply. If you’re going to deal in digital currency, you’re going to need a way to keep it safe and secure.
If you want to purchase digital assets, you’ll need access to an exchange, either an organized corporate platform like Coinbase or one of the more automatic exchanges like Shapeshift, which enables users to exchange one digital currency for another with a fee.
With an exchange, you can purchase and trade your desired currency. However, if you're looking to store your currency or spend it on goods and services, you'll need a wallet.
The continually shifting currency landscape can make the proper choice a challenge. In this article, I will evaluate all of your options when it comes to protecting your valuable assets.
What are they?
There are many different wallets, including software, hardware, and paper. Each can store different kinds of currency, manage the cryptographic keys and the security features for transactions, storage, and in some cases, identity information.
The most critical security element is the cryptographic key associated with it. The private key appears as a series of machine-generated numbers and letters. This is what you use to lock or unlock access to your stored cryptocurrencies and generate wallet addresses.
Whoever controls the keys controls access to your assets. This is why it can be a risk to store your digital assets on online platforms. This is an important consideration when deciding on a cryptocurrency wallet platform.
Do I need a crypto wallet?
If you own any cryptocurrency at all, it is being held in a wallet. You can’t have one without the other. However if it is on an online platform and you don’t own the keys, you only have access to the assets. You don’t "own them" until you manage them on your own. So if freedom and control is important to you, then you need your own wallet.
Five Types
There are five different types in this long list:
1. Cold Wallets
This is how you store currency offline. Cold wallets have keys from a cold source, meaning not connected to the internet. This adds a layer of security, what you might call an “air gap.”
These kinds of offline sources are available in hardware format as a USB flash drive. You could keep it stored in a safety security box with no way for online hackers to access your assets.
2. Hot Wallets
As you might have guessed, hot wallets have keys generated by internet-connected platforms like Coinbase. The keys are typically stored in the server of the online platform or the back-end exchange.
Though hot types may not be as secure as cold wallets, there among the most popular cryptocurrency hot wallets in use. This is because most people prefer to have their digital currencies available for trading, making purchases, or accessing foreign goods or services.
3. Decentralized Wallets
This means that you have no centralized back end you would need to engage with to buy, sell, or trade. When you control your private key, you can connect and generate a transaction, anywhere, with anyone, at any time. One thing you have to keep in mind is that when you control your key, it’s your responsibility to keep yourself secure or run the risk of losing your money.
4. Hosted
These are the opposite of the decentralized types, where the platform stores and controls your keys. Some feel these platforms have a higher degree of specialized security that normal consumers would previously. That may or may not be true, one thing that can’t be denied is that they are also storing the keys of thousands of users.
This means that hackers are more likely to target them for an attack than you as an individual. This also means that you need to need to log in online as opposed to just directly connecting with whomever you want to conduct a transaction with. Hosted typesoften require identification registration which means your privacy can be compromised.
5. Paper
It might come as a surprise to some, but when they call it a "paper wallet," that's precisely what they mean. It is a sheet of paper where your public and private crypto keys are printed, often in the form of QR codes.
To use these kinds of wallets, all you have to do is transfer currency to the public address shown on the sheet of paper.
The reason QR codes are ideal is that it takes too long to type out the string of letters and numbers of an address. However, these should be used as piggy banks, in that you don't want to send only a small portion of the total money to another user.
You can only make a single withdrawal of the full balance from a paper wallet. Why? After you broadcast a transaction, it becomes insecure and should be discarded.
A Word on Exchanges
Cryptocurrency moves fast, in both a financial and technical sense. Blockchain tech is continually being improved upon with new iterations, while the rules surrounding the technology are also being continuously revised. Cryptocurrency is much like the Wild West, and in that way, much riskier than tried and true assets for individual investors.
Currencies like Bitcoin remain one of the few assets that individuals can attempt to manipulate in terms of price and not end up in prison. However, maybe this will change in the future.
When deciding on which kind of exchange you want to use, you have to consider what kind of an investor you want to be. There are generally two different kinds of trading sites for cryptocurrencies.
If you’re looking for a more regulated, stable kind of environment, you can choose an exchange like Coinbase. They have made a lot of effort to navigate the uncertain regulatory landscape of cryptocurrencies, making the platform more future-proof.
Using Coinbase
This company has done whatever is necessary to remain in compliance with US banking laws. This means that they have to collect data on the people that do business on their platform and have scans of personal documents like state IDs and Passports. They even require your Social Security Number. Some people might feel that providing these kinds of details is too intrusive.
One of the drawbacks of some of the more controlled exchanges is that they tend to have fewer options in terms of which cryptocurrencies you can buy or trade.
When new coins hit the market, it can take time for financial regulators to evaluate them. Regulated trading platforms will have to make a dedicated effort only to support approved cryptocurrencies.
For Freedom
Some investors feel that these kinds of regulations are too cumbersome and they interfere with the free-wheeling, independent spirit that modern digital currencies are known for. They want to buy some of the newest currencies as soon as they become available. These kinds of regulated platforms can also interfere with the anonymous nature of crypto.
With the current volatility of the cryptocurrency market, it’s possible that you might see your holdings surge in value at any time. When it does, you can expect that hackers will start to take an interest in opportunities to scam people. You don't want to end up getting your assets stolen off of an online platform like the holders who were ripped off during the Mt. Gox incident.
The question of why you should purchase a wallet becomes the more pertinent question of which kind should a cryptocurrency investor use. As do all forms of insurance, security comes at the cost of money and convenience. How should we balance it in a way that suits our risk profile?
The question of what is the optimal way to store your digital currency is becoming more and more pertinent. As with all forms of security, they often come with a cost of money or convenience. In this article, we will try to guide you on how you can balance your storage with a way that suits your risk profile. There are six desired traits you should consider.
Desired Features
What are the desired traits of a crypto wallet and how hard can choose a wallet to be? This seemingly easy answer, unfortunately, does not have a satisfying answer: convenience may come at the cost of security; additional features may come at the cost of a steeper learning curve.
More importantly, what are the traits that, ultimately, you value over the others? See the list below, not in order of importance:
When deciding on a crypto wallet which features are the most important? There is no easy answer to that question, as it will depend on what you're looking for. Convenience comes at the cost of security, while advanced features make require dedicated study to use appropriately. Here are some examples:
1. Cost
How much does it cost?
2. Security
How does it prevent attackers from access?
3. Mobility
Do you need to hold onto hardware to use the wallet? What will happen if you lose the item? What will happen when it falls into someone else’s hands?
4. Ease of Use
Is the wallet challenging to navigate and use? Does it support all the currencies you have in mind?
5. Convenience
Are you able to log in quickly and close a transaction when you need to? Will you be stuck holding the bag when the price begins to plummet?
You’re likely going to want a wallet with the optimal combination of the traits mentioned above. Keep in mind that all wallets have their pros and cons.
Bitcoin has become the bread and butter of cryptocurrency trading. It offers a censorship-free alternative to government-backed securities. Digital currencies like Bitcoin are also more accessible, safer, and more private than sending money over platforms like Paypal. Because the price of Bitcoin has more or less stabilized in recent years, people have started to consider it as a currency again.
However, before you decide to exchange your dollars for Bitcoin, it's important to know what the risks are. Bitcoin could potentially double in the next few years. The price could also drop to near zero.
It is recommended that you only purchase what you can afford to lose. If you understand these risks, and you're comfortable moving forward, and of the wallets in this article should be suitable for you.
The most crucial feature you should consider when evaluating wallet options is whether or not it supports the currency you’re interested in. While Bitcoin tends to be standard, not all wallets will carry the altcoins you might be interested in. There are dozens of different options, new ones popping up every week.
If you want to use a specific currency, for example, Ripple, you'll want to make to make sure that your cryptocurrency wallet supports it. If you want to add multiple different coins to your portfolio, then you should focus on wallets such as Exodus or Jaxx. Both of these platforms support multiple currencies and even show you what percentage of your money is in each asset with a pie chart.
If You're a Speculator
If you're a speculator and comfortable with a certain amount of risk, and you want to protect your transaction privacy, you should be looking for a wallet that isn't bound to a specific exchange on the back end.
If a wallet requires ID verification or other kinds of identifying transaction data, this might not be what you’re looking for. Exodus and Jaxx work for this purpose, in conjunction with ShapeShift for exchanging one kind of coin for another.
If you're not interested in speculating and you want to store cryptocurrency as a kind of digital nest egg, you should look into a safer, more regulated environment. A regulated exchange like Coinbase might be most suitable for your needs.
Coinbase goes through great pains to make sure they follow US banking laws, and they're backed by the capital to support their platform. Coinbase doesn't support all currencies though, so that is one disadvantage. They do offer a cold storage vault which may be of interest to people that trust the company to hold their assets.
Next, on the list are minimalist cryptocurrency wallets. Options include applications such as BRD or Copay Bitcoin wallet (details below). These wallets are primarily mobile, allowing you to access and track your digital currencies while on the go.
They're not meant for purchasing assets with fiat, and they're probably not ideal for holding large amounts of digital currency. Their most valued purpose is as a way to keep your funds on your phone to potentially pay for things with the build in QR scanner.
Security Considerations
You may be worried whether your cryptocurrency wallets are safe for holding a large number of assets. For day to day use, things like a basic desktop wallets or mobile platforms should be suitable. However, some kinds of wallets are indeed more secure than others.
Every wallet has password-controlled access of some kind. These could be a standard passcode or a pin code you have to enter in conjunction with a kind of app or dongle. Most encrypt data through a thing called SSL (Security Sockets Layer) to protect your transaction while it's processing. This mode of encryption securely protects your private key and public key on your local device or the servers of the cryptocurrency platform you're using.
That’s the most basic form of currency on any platform. The next security feature that you should find on most platforms is two-factor authentication (2FA) and multi-signature support.
2FA
This is when a particular piece of software on your mobile device provides a numerical key you'll need to sign into your account and access your wallet. Generally, this code is only accessible through an app and not through an email or a text message. The 2FA software makes a new key every minute, and this prevents people with private key-loggers from reliably being able to attack your account. This means that for someone to attack you, they would need not only your primary account details but also your mobile device.
Multi-Signature Support
This is otherwise knowns as a “two out of three” system. It’s similar to a joint bank account in regards to the private key to your wallet. It generates three keys: one that’s controlled by the platform, one that’s controlled by you, and the other is shared with a third party. To obtain access to the assets, you must have at least two out of the three keys. This is similar to the type of system some platforms use for their cold storage vault service such as Coinbase.
Hot Wallets
Coinbase is one of the most accessible platforms for getting started with cryptocurrencies. You buy, sell, and hold digital currency. You can also sell your coins for dollars and deposit the cash into your U.S. bank account.
Coinbase not only offers support for Bitcoin, but it also has Ethereum, Bitcoin Cash, and Ethereum. There are always rumors circulating that new coins could be added in the future as well, like Ripple.
While the significant upside of Coinbase is ease of use, that is offset with some worries about security. Mt. Gox was at one point the dominant platform for Bitcoin and other currencies. That is until it was hacked and lost nearly half a billion dollars in user currency. However, Coinbase did learn from Mt. Gox’s loss, and has excellent security in place and regularly updates and improves the entire user experience.
The most significant advantage of Coinbase is its security. After Mt. Gox got hacked and lost users billions in assets, Coinbase has made a dedicated effort not only to observe banking regulations, but also to make their users' experiences are most suitable.
Is Coinbase a safe wallet?
Coinbase is an online platform with a web-based wallet. It is probably of the most beginner-friendly sites for novices to get involved with Bitcoin. You can easily buy Bitcoin with cash, connect your account to your bank account. You can also activate 2FA (two-factor authentication) for safety and security. The only disadvantage to using Coinbase is their limited support of different coins on the site.
PROS
CONS
Conclusion
A Coinbase wallet is suitable for someone that doesn't know much about cryptocurrency. However, most would be better served by learning how to store their digital assets on their own, away from a platform that can arbitrarily decide to close your account.
Blockchain.info
If you didn’t already know, "blockchain technology" is what allows cryptocurrencies to have the value they do today.
Blockchain.com (or Blockchain.info) is a wallet which supports Bitcoin, Bitcoin Cash, and Ethereum. It also has a bitcoin block explorer service.
Though it’s not a full exchange, it is still considered to be a safer alternative to Coinbase. Because of the lower level of attention it receives, perhaps it won’t be such a prominent target for hackers. This wallet is a little more advanced than Coinbase, adding increased security.
Hardware
Trezor
Trezor provides no system for buying and selling cryptocurrencies like Coinbase. It is merely a wallet for storing your digital assets. Trezor is a kind of dongle that you can plug into your phone, tablet, or PC so that you can securely access your coins.
The Trezor supports many different currencies, and comes with two-factor authentication, can be used as a password manager, and has other useful features.
The wallet has some protections against lost devices or passwords, but you should make doubly sure that these kinds of situations don’t happen to you. The point of this hardware wallet is to prevent others from stealing your coin, so the recovery process isn’t a simple one.
Trezor is one of the most popular when it comes to hardware wallets, setting the gold standard for security. They have a reputation for preventing both virtual and physical theft of currency. Even if they may not be the most stylish alternative, Trezor may be one of the most secure. Trezor is more of a vault than a wallet, as even if someone succeeds in attacking your device, they will have no way of accessing your private key.
KeepKey
This is one of the most elegant-looking tech gadgets for protecting your digital currency. They come with a polished design and what is said to be a port of Trezor’s security software.
The main difference between Keepkey and Trezor is that the Keepkey feels more like a luxury item. It’s attractive, a little heavier than other wallets, with a simple client UI for easy use.
Ledger Nano S
Ledger Nano S provides a similar level of security to Keepkey and Trezor. What makes it an attractive option is its lower price.
It's portable, easy to carry, and priced competitively. However, which is the better option between Trezor and the Ledger Nano S? Read my comparison guide for more details.
For more guidance on which hardware wallet will be most suitable for your purposes, check out my guide on Trezor vs. Ledger:
Apps for Buying and Selling
Robinhood
However, what sets Robinhood apart is the cost: free. There are no commissions when buying or selling Bitcoin, just like stocks on the platform.
Some may argue it is less secure for reasons we already discussed, but if it is secure enough for your stocks, it is secure enough for your coins.
The fact that there are no fees is what makes Robinhood one of the most attractive options. While it may not be as secure by comparison to hardware wallets, if it can be used as a portfolio for stocks, it should also serve as an appropriate platform for cryptocurrencies.
Desktop Software
Exodus
Like Electrum, Exodus is a wallet that you can keep on your desktop computer. What sets it apart is its beautiful interface and intuitive features.
Whenever you buy a coin and place it in your Exodus wallet, the wallet shows a helpful pie chart to determine your asset spread. It is also integrated with Shapeshift, allowing you to quickly and easily exchange currencies.
It doesn’t require you to register an account because it is not used to purchase coins. One thing you’ll want to keep in mind is that Exodus includes private keys and other security tools in folders on your computer. This is one of the most user-friendly software wallets.
PROS
CONS
Conclusion:
This wallet is perfect for people that want an easy desktop solution to holding a vast array of different cryptocurrencies. Not only are many different coins supported, but it also provides a way for users to access the kinds of currencies they desire through ShapeShift.
Electrum is another software wallet similar to Electrum, which stores your keys on a set of files in your computer. As of now, you can use it on MacOS, Windows, Linux, and Android.
It can also be used in conjunction with hardware wallets such as Trezor.
Electrum takes little time to get set up and use for storing Bitcoin. While some worry about what might happen if your computer were damaged in a house fire, or if your computer ends up hacked and corrupted, there are ways to keep your coin safe with some seed words. You can easily use your seed to restore your wallet on a new device should anything happen.
Best Mobile
Mycelium
This is a mobile-only application, compatible with iPhone and Android. This wallet has more multiple options for slightly more advanced users of cryptocurrencies.
However, beginners should still be able to use the functions and navigate without difficulty.
Though this application is not available on the web, most users are comfortable using their devices. Mycelium allows for anonymity and is a secure mobile solution for keeping cryptocurrencies.
Copay
Copay wallet is an HD-multisignature wallet original created to be used in tandems with BitPay. It supports shared wallets, testnet, multiple personal shared wallets, and the full Payment Protocol.
It can be used in tandem with the BWS node for enhanced privacy and security.
PROS
CONS
Conclusion
While Copay may be Bitcoin only, it supports multi-signature accounts and is easy to use. As long as you’re not looking to store altcoins, Copay might be a good choice for a mobile crypto wallet.
Best Universal
Atomic
Atomic Wallet is a non-custodial, multi-asset wallet, with more and more users. With a very user-friendly interface, this wallet can be used to store and manage over 300 of the top cryptocurrencies.
Every week, they update their list of supported coins. If you don't see the coin you're looking for yet, it's likely you soon will. The wallet is available for all major operating systems, supporting Max, Linux, Windows, Android, and iOS.
Atomic Wallet has almost all of the features you might be looking for. It has a built-in option to interface with a bank card, an intuitive AI, and decentralized storage of private keys. It also integrates with Changelly or Shapeshift for storing custom tokens.
Atomic Wallet features a new kind of decentralized exchange technology called Atomic Swaps. Based on hash timelock contracts, this feature is available for Litecoin, Bitcoin, Ethereum, and QTUM.
Jaxx
Another mobile wallet, Jaxx offers most of the same benefits and features you would expect. It has versions for Android and iOS.
It allows you to scan QR codes to send assets, check how much you’re holding in assets, and back up your wealth with a mnemonic seed.
It offers Shapeshift integration and can be linked with other wallet platforms. The only potential drawback to this wallet is that it might take a while to learn how to make use of all the features. It’s a little advanced in that sense.
PROS
CONS
Conclusion
Jaxx is probably one of the most excellent mobile wallets in terms of support, many currencies on the platform, and convenience. Some people still say that Exodus is a superior experience.https://www.exodus.io/
Questions
What’s the best wallet?
It depends on what platform and what features you are looking for. For hardware wallets, Trezor is a solid choice. For software wallets, Exodus is highly recommended. For universal software wallets, Jaxx often has the features people are looking for.
What’s the safest wallet?
Cold storage, such as hardware wallets or paper wallets, are likely the safest, as they prevent hackers from being able to attack the security of your assets without physically getting their hands on your materials.
Is there a wallet for all coins?
Jaxx and Exodus come close to a universal cryptocurrency wallet. They are continually adding support for new wallets as time goes on.
What is the best wallet for altcoins?
The best crypto wallet for altcoins would be the ones providing the largest amount of support for new and upcoming currencies. For this I would also recommend Jaxx or Exodus.
What is the best way to create a crypto wallet?
The best way to create a crypto wallet would depend on what you want to use it for. For saving, without access to the assets, I would recommend creating a paper wallet. You can also use a USB flash drive as a crypto wallet by storing your keys.
Best Android crypto wallet?
I would recommend Jaxx or Copay. Both offer supports for multiple currencies, both are very secure.
Best crypto wallet for Asimi?
The Waves wallet appears to be the only way for Asimi holders to receive or exchange the tokens without restrictions.
Best crypto wallet in Mexico?
The best crypto wallet in Mexico is Bitso.
