Beginner’s Guide to choosing the right cryptocurrency wallet
Cryptocurrency wallets are secure digital wallets used to store, send, and receive digital assets like Bitcoin, Ethererum or Litecoin. They are an essential factor of owning and investing in cryptocurrencies of any sort. Most of digital currencies have their own official wallet but third-party wallets have also emerged and they allow you to manage multiple coins at once – however, most of them will only support a limited number of cryptocurrencies.
Types of wallets
Wallets are mainly split in to two categories: Cold Storage Wallets and Hot Storage Wallets.
Cold Storage Wallets are essentially hardware wallets, held offline, which makes them much harder to hack or steal because they are not always accessible. It is also thought to be the most secure way to keep your assets and they are suitable for holding crypto for longer-periods of time. Think about having a savings account, harder to access but more secure. Hardware wallets can be : Paper wallets, USB devices wallets and lately mobile like devices.
Hot Storage Wallets are Software wallets and they are considered ‘hot’ because of the greater ability for activity and accessibility since most of the time them are connected to the internet or require an internet connection to access them. Below are the three types of software wallets:
- Desktop wallets: for laptops and computers; where the software is installed on your device. You can use a lot of these wallets without being connected to the internet.
- Mobile wallets: you download an application for your device. These have pretty decent security, and easy functionality by using QR codes, allowing you to make quick transactions.
- Online web wallets: are wallets used online, and they require an internet connection every time you access them.
Software wallets are split into two categories:
- Centralized wallets – allow you to manage your cryptocurrency while a 3rd party company is safeguarding your private keys. These types of wallets are sometimes referred to as “cloud wallets.”
- Decentralized wallets – you hold and manage your private keys and you are responsible for keeping them safe.
Each wallet type has different pros and cons and you should weigh the risks of each one depending on what you need it for (security, easy access, long-term holding, coins supported etc.).
Our Top Picks
As you are not limited to using only one cryptocurrency wallet or you might need more than one, we have selected 5 Cryptocurrency wallets which are trustworthy and easy to use to get you started managing your cryptocurrency assets.
Ledger Nano S/X
Ledger Nano S is one of the most popular option for hardware wallets. It supports over 40 cryptocurrencies including Bitcoin, Ethereum, XRP, XLM and Bitcoin Private, allowing users to manage multiple assets with the same hardware wallet at the same time maintaining the highest security and protection levels. Find out more here.
Undoubtedly Coinomi is the most popular mobile wallet. It allows you to store, receive, send and swap multiple cryptocurrencies directly from your iOS or Android device. It supports over 125 coins and 300 ERC20 tokens. It’s a decentralized mobile wallet and the build-in swapping services are provided by Changelly. Find out more here. Coinomi has recently released their beta version of the mobile PC application.
Jaxx wallet is another multi-platform, multi-asset digital asset wallet. It support over 85 coins and tokens and it has in-build swapping services provided by Changelly and Shapeshift. It is and easy-to-use wallet with cutting edge technology and you can use it on your mobile device, PC or download the Chrome extension. Find out more here.
Atomic Wallet is feature-packed. It is among the most secure, trustworthy, transparent and decentralized wallet. You can manage over 300 coins and tokens in a single interface, secure, decentralized and anonymously. It has in-build decentralized Atomic Swap, with cross-chain exchange avoiding third party risks, and for coins not supported yet by their DEX you can swap them through Changelly or Shapeshift in-build services. It supported on all devices: Mobile, Tablet and PC.
Acquired by Binance (the biggest crypto exchange by volumes), Trust wallet started as a secure mobile Ethereum wallet that supports Ethereum ERC20 & ERC223 tokens. It provides a fully security audited system to send, receive and store your digital assets. You have complete control over your private keys that are only stored on your device and is a full-fledged Web3 browser that allows you to interact with decentralized applications (DApp) directly from the app. Recently, Trust wallet has become a multi-currency wallet, and they are supporting over 30 currencies at the moment.
Decentralized Dedicated Wallet
Most of the coins are coming with their own dedicated wallet which you can use to manage that particular coin. They are usually decentralized, which means you hold and must protect your private keys and it’s a good option if you don’t want headaches by using multi-asset wallets. Remember to always download such wallets from official sources and avoid “scammy” links since it has began a widely spread practice in the cryptoshpere.
Undoubtedly, there are many different wallets available and it can be hard to choose the best one; you might need to use more than one, depending on your assets. Our advise is to always look for decentralized wallets, because they allow you to manage your private key and, therefore, you are the real owner of the assets. Furthermore, always pick a wallet that will best suit your needs depending on what you need from it and the purpose of your holdings. Remember, crypto wallets are the difference between a wonderful crypto adventure and a really bad one!