What is a cryptocurrency wallet? Although it differs significantly from an original wallet, the function is the same. However, instead of storing fiat money, the purpose of this wallet is to store your bitcoin, information connected to it, private keys, etc. Leaving your crypto on exchange might be dangerous as many exchanges face cyberattacks, so your bitcoins and other altcoins could be stolen, and you would lose all your crypto just because you haven’t stored it in your wallet. Therefore, it is recommended to do it as soon as possible to protect your funds.
There are two main types of wallets: software and hardware.
SOFTWARE WALLETS
Software wallets are the first type of wallet you can use for storing your crypto. You can easily download them onto your smartphone or computer. Before putting your crypto in there, you are usually provided with 12 words password that needs to be remembered. Without it, you cannot access your wallet and your coins if something happens to your device or you forget the password.
Software wallets gain more popularity among users who’s just started with cryptocurrencies. The advantage is seen in its availability and simplicity. However, software wallets are still connected to the internet, making them easier to attack than hardware wallets. Nevertheless, having a software wallet is still less risky than keeping your portfolio on any exchange. The first thing you need to be aware of is the way how the wallet is secured. Another advantage is that some exchanges offer the possibility to store your crypto with their crypto wallet.
When it comes to choosing the appropriate wallet, you also need to consider which coins the wallet can store. Some wallets can store only a specific type of cryptocurrency, so be aware of it!
EXODUS
You can use Exodus both on your laptop or your mobile phone. It offers more than 100 coins. This wallet is super-friendly for those who are new to crypto and need something user-friendly. There is no need for registration. Nevertheless, it doesn’t provide you with two-factor authentication. Thus, your crypto is secured by a password only.
COINBASE
Coinbase, mainly known as an exchange, offers for its users crypto wallet as well! Coinbase is the most secured software wallet in the current market. Unlike Exodus, Coinbase has two-factor authentication.
HARDWARE WALLETS
Hardware wallets, also known as cold storage, are physical devices similar to external hard drives. Unlike software wallets, with hardware wallets, your cryptocurrency is no longer stored online. This fact makes hardware wallets the most secure way to store your cryptocurrency as it is impossible to hack your wallet through software devices. Hardware wallets are still secured by a password. So in case you lost your wallet, or someone steals it, your crypto is protected. If that happens, you can transfer your crypto from your wallet into a different one using the password.
Unlike software wallets, hardware wallets are not free of charge. There are plenty of wallets available, and the price can vary according to your demands. Some of them might cost even 100 dollars; however, if you tend to hold your crypto long-term, the purchase is recommended.
Either way, any wallet will serve you better than leaving your crypto on an exchange. For beginners who keep a lower amount of crypto, it is recommended to use a software wallet first. However, if you hold more crypto or you want to secure it as much as possible, a hardware wallet is a right choice.
TREZOR
The most appreciated hardware wallet is considered to be Trezor. The price varies between 60 to 180 dollars, depending on the type you prefer. It supports more than 1,000 cryptocurrencies. The usage is also pretty easy, and you can connect it to the PC or your mobile phone.
LEDGER
Another great option for a software wallet is Ledger. Although pretty small, about the size of a USB flash drive, it is protected by a stainless steel cover that should prevent all damages. Ledger supports more than 1,800 coins; however, this can be expected from the expensive models only. The price varies between 60 to 120 dollars.
