What are Crypto Wallets? Everything You Need to Know

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In Brief
  • Crypto wallets are used to store your crypto funds.

  • Desktop and mobile are the most popular types of wallets.

  • Hardware wallets are important for those who plan to hodl.

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If you’ve invested in Cryptocurrency, there’s one thing you’re always going to need — A safe, reliable Crypto wallet to store your assets in.

Crypto wallets come in many shapes and sizes, with mobile, desktop and hardware wallets available for almost all coins on the market.

As crypto wallets come in so many different forms, this article will explore the many different types of wallet, what they do and how you can use them safely secure your precious Cryptocurrencies.

This Article Contains:

What is a Cryptocurrency Wallet?

A crypto wallet is a platform, usually either an application or software, that stores your cryptocurrencies.

The wallet allows you to store, send and receive cryptocurrencies quickly and safely. Some of these wallets have more features than others, including the ability to store cryptocurrencies from various networks alongside more advanced security measures.

It is also important to be aware of “hot wallets” and “cold wallets.” Hot wallets are wallets hosted on an internet-enabled device, making them easier to access but also more susceptible to security risks.

Cold wallets are wallets where assets are stored completely offline, meaning the only way to access them is to physically have control of the device, private keys or master seed phrase.

Generally, hot wallets are used for smaller amounts of funds that move quicker, like for spending, trading, payments or exchanges.

Cold wallets are often used by long-term holders that wish to safely lock away a majority of their portfolio for a much longer time period.

Most of the wallets listed either have cold-storage wallet creation built in as a feature, or can create master seed phrases that can be stored securely offline and later used to recover access.

What are Public and Private Keys?

It’s also worth covering public and private keys and how they relate to Cryptocurrency wallets.

Your public and private keys allow access to your cryptocurrency. For example, when someone sends you cryptocurrency through a wallet, they are authorising the ownership of the coins from their wallet to yours via the keys.

To receive coins, you need to provide your public key. A public key can be compared to an account number, and can be freely shared with everyone.

A bitcoin wallet address is a hashed version of your public key, which is why this wallet address is used to send and receive cryptocurrencies.

This public key does not reveal the identity of the owner, which is why blockchains are considered to be ‘pseudonymous’.

Private keys, as the name suggests, should be kept private at all costs. They act like a PIN code, meaning when used together with your public keys, you gain access to the funds on the blockchain.

Always remember rule one of Crypto — Your private key(s) should never be shared with any other person. These keys are not stored on a blockchain, rather through an (encrypted) file, which can be saved anywhere and stored offline.

They should be secured in the safest way and place possible, ideally on a paper or hardware wallet.

So, how do your keys interact with your wallet?

Simple — think of your wallet as an encrypted key card that contains all the information you need to access your assets. Your wallet combines and contain your wallet addresses alongside your public and private keys.

How Do I Keep My Wallet Secure?

The level of security varies with each type of wallet. As always, storing your keys online is always a more high-risk option than offline because of the potential for hacking or a exploit on your devices.

Ways to increase the security of your wallet include backing up your wallet, keeping the software updated and adding extra security measures such as 2FA and identity verification.

Regardless of which type of wallet you use, if you lose your private keys, you lose access to your assets. Please check out our Top 10 Security Tips for even more ways to improve the security of your assets.

As the popularity and price of the cryptocurrency market continue to rise, it has maybe never been more important that users understand how to properly secure their assets.

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The Different Types Of Wallets Available

Now we’ve covered the basics of what a crypto wallet is and how it works, let’s move on to the different types of wallet available to you.

BeInCrypto has compiled an overview of some of the most prominent wallets available for Bitcoin and other popular cryptocurrencies.

1.) Desktop Wallets

Desktop wallets can be split into two groups, ‘Bitcoin only’ and ‘Multi-coin’ wallets. These should generally all be considered hot wallets, though most offer some means of creating offline storage as well.

All wallets covered here are available on Windows, Mac and Linux.

a.) Multi-Coin Desktop Wallets

Due to the popularity of altcoins, wallets now provide storage for coins from various networks and functions. The most popular multi-coin wallets provides users with a single interface for managing a diverse portfolio.

i.) Atomic Wallet

Source: Chrome Web Store

Atomic Wallet is one of the more popular multi-coin desktop wallets available for Cryptocurrency holders, offering top-tier security and management of your assets.

It’s available for Windows, Mac, and Linux systems alongside Android and iOS apps. The wallet has a simple, friendly interface and is designed for users of all Crypto knowledge and experience, making it an ideal wallet to store your assets on.

Atomic Wallet provides excellent security protocols alongside an inbuilt swap function named “Atomic Swap”, which allows users to swap their their cryptocurrencies to other coins, all from the wallet.

ii.) Exodus Wallet

Source: Exodus Wallet

One of the original cryptocurrency wallets, Exodus Wallet has been around since 2016 and remains one of the most popular multi-coin desktop wallets available on the market.

It provides comprehensive security and safety of your assets alongside full support for assets from multiple networks, allowing users to send, receive and store their favourite coins in Exodus Wallet.

Both wallets are solid choices for those fairly new to the cryptocurrency scene as they both offer support for multiple coins and networks, multiple address management and applications that can link with exchanges like Shapeshift.

Both also offer mobile apps that can sync to access your portfolio on the go as well as support with hardware wallets to further increase security.

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b.) Bitcoin Wallets

Some wallets only offer support for Bitcoin, making them perfect for Bitcoin holders looking for maximum functionality and security from their wallet.

i.) Electrum

Image credit: Electrum

Electrum is a favourite among many Bitcoin users as it is simple, easy to use and lightweight. it takes minutes to configure and simply verifies your balances and allows you to process, send and receive payments.

The interface isn’t overly technical, but could still be confusing for new users and those unfamiliar with simpler wallets.

Electrum use their own “trusted” nodes to verify transactions, making the process much faster for the more casual user.

This does sacrifice a level of security and control found in “heavier” wallets as it relies on other servers for payment information. However, this doesn’t compromise the users assets in any way.

Electrum allows you to encrypt your wallet file during setup and also provides a “cold storage” mode to create a wallet that can only be watched.

ii.) Wasabi

Image credit: Wasabi

Once configured, it has a clean interface that is simple to use and manage. It’s not as intuitive as other wallets, and has a learning curve. However, once you’re set-up, you’ll find Wasabi wallet to be the most secure wallet on the market for your Bitcoin.

Other options include Armory wallet, another light storage solution with cold storage support and simple management of multiple wallets. The UI may still be a bit daunting for new users, but should be pretty straight forward for anyone familiar with any type of desktop wallet.

Wasabi is an open source Bitcoin wallet, available on Windows, macOS and Linux that focuses on privacy and security.

Wasabi has proven itself to be a popular wallet for those seeking greater privacy of their funds due to Coinjoin.

They also use the TOR network to help hide user IP addresses and transactions. Setting up a Wasabi wallet can be confusing to set-up due to the focus on security, so use the inbuilt wizards and tools to help you get started.

2.) Mobile Wallets

Mobile wallets are perfect for managing your portfolio on the go and for the simple sending and receiving of Cryptocurrencies to friends and family.

While virtually every platform listed above has a mobile app to accompany their main product, few mobile wallets that have managed to prove themselves as the best mobile product for holders.

a.) Trust Wallet

Image credit: Trust Wallet

On Trust Wallet, you can store coins from all major networks, with the added option to backup your assets available for an added layer of security.

An inbuilt Web3 browser allows you to interact with popular DApps through Trust Wallet, and access various exchanges through the app with Trust Wallet/WalletConnect support.

As Trust Wallet supports coins from multiple networks, you can stake your favourite coins with ease.

Other options include Mycelium is a highly popular wallet that has been around for many years. It supports only Bitcoin, but offers the creation of a master seed used to restore the wallet, and hence could be used to create cold storage solutions.

Samourai Wallet is also Bitcoin only, with an emphasis on minimizing fees by integrating Segwit and also has the ability to broadcast transactions offline using SMS.

BRD (formerly Breadwallet) offers support for Bitcoin, Bitcoin Cash, Ethereum and ERC-20 tokens, has a very simple interface, and boasts around-the-clock support.

Both Mycelium and BRD are available on Android and iOS, while Samourai Wallet is Android only.

If you’re set with Bitcoin and looking for a good Ethereum wallet, there are various options available. Check our Ethereum wallet guide to find the best option for you.

3.) Exchange Wallets

Cryptocurrency holders can also choose to hold their coins on an exchange wallet like Binance, StormGain or Coinbase.

This is an ideal place to hold your coins when you first start on your cryptocurrency journey.

Most exchange wallets are safe. They are also insured—which gives you the added protection in case of a hack or breach.

There’s an expression in Crypto — NYKNYC; it means “not your keys, not your coins.” This is worth remember when keeping your coins on exchanges.

Generally, anyone who isn’t trading as a profession is encouraged to move most or all funds into at least a personally controlled hot wallet, if not true cold storage.

Conclusion

If you’re a cryptocurrency holder looking for a reliable wallet, you’re now spoilt for choice!

Each wallet comes with its own benefits and risks, and many users may find it helps to explore multiple solutions for multiple use-cases.

Also, as times goes on, there will likely be strides made in both ease of use and security, but for now it still falls to the user to take necessary steps to be safe with their own funds.

So whether it’s a desktop, mobile, browser, exchange or hardware wallet, all of your favourite assets are now widely supported.

We know you’ll find the right wallet for your needs using our guide above.

Protect your crypto with StormGain’s multi-currency wallets.
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All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk. At Learn, our priority is to provide high quality information. We take our time to identify, research and create educative content that is useful to our readers. To maintain this standard and to continue creating awesome content, our partners might reward us with a commission for placements in our articles. However, these commissions don't affect our processes for creating unbiased, honest and helpful content.
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Jessica graduated in the UK with a Biology degree and then spent several years managing communications for companies in the UAE, Africa and South East Asia. She believes that bridging the education gap is a vital step in mainstream understanding of what emerging technologies can offer societies worldwide.

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