Cryptocurrency is a common phrase in the tech world. Even though it has attracted thousands of subscribers, some aren’t aware of what a cryptocurrency wallet is.
Cryptocurrency wallet is software where you store your digital currency. The difference between losing your currency and safeguarding it depends upon the type of wallet you use. There are several types of cryptocurrency wallets. There are web-based services, offline services, and app-based services.
What is a Cryptocurrency Wallet and what are the Best Wallets?
A cryptocurrency wallet is a software you use to send and receive cryptocurrency tokens. These wallets let you check your balance of different coins.
Blockchain works uniquely. When the ledger gets updated, it goes across all nodes on blockchain structure. Besides, the wallets hold a record of transactions.
In the crypto ecosystem, the phrase ledger means database. But, a node is what crypto geeks refer to individual computers that operate and maintain blockchain.
Cryptocurrency wallets do not cut money like PayPal accounts or your average wallet. This is the difference between other online accounts and cryptocurrency wallets.
Importance of Protecting Crypto
Investing in cryptocurrencies isn’t a bed of roses. You need to get a safe crypto wallet and deposit cash in it. This is the amount you will use in exchange to buy other coins. There are different entities involved in the crypto investment. They are all supposed to be working for the process to be natural. If any stops, the entire process is paralyzed.
Your hard drive, a removable disk, or your mobile phone is your bank vault in cryptocurrency industry. This has been brought by decentralization. Well, decentralization has eliminated middle-men in which investors have faith. But this comes with misfortunes. Still, having faith means you are responsible for ensuring your cryptocurrency is secure.
Cryptocurrency Wallets
Mycelium
Mycelium wallet
This bitcoin wallet is convenient and easy to use. It was launched in 2008. It has had a strong history within the Bitcoin and cryptocurrency ecosystem. This app has an appealing interface which is easy to use. The taps provide options between different tasks.
It protects the Bitcoin address and the Private Keys by providing an all-in-one Bitcoin wallet security system using HD. HD, in other words, is Hierarchical Deterministic wallet security.
Be it as it may, this app uses the Microsoft Reference Source License. The MRSL helps to keep technology safe by providing unlimited for the underlying tech code.
The downside with the wallet is volatile transaction fees and unreliable customer service.
Cryptonator
Cryptonator Wallet
Cryptonator enables instant direct cryptocurrency payments and exchanges between multi-currencies. This is due to the multi-currency feature. You can send and receive Bitcoin and other currencies using your mobile phone.
Cryptonator uses bank-grade security technology. In other words, you can trust this app on security. Still, it has deployed the use of Encrypted SLL web connection technology. It uses the HTTPS Google-validated web connection protocols in connection with two-Authentication and Trusted IP technology.
This app charges the lowest transaction fee. But, the customer service is wanting. You have to wait for long periods to be served.
Copay
Copay Wallet
Bitpay is the team behind the development of Copay. The app has strong privacy settings and some handful security features. It uses Bitpay’s HD-multi signature technology. You can share this wallet with friends and family just like a joint checking account.
The HD-technology is helpful in restoring your account if anything goes wrong. Copay is good for Apple users. For Android users, it is the best mobile wallet.
The customer service, just like other wallets is horrible.
In general, phone-based crypto wallets are great. Wallets that uses HD and 2FA technologies are the best. The only issue is the customer service, as said above, It’s horrible!
Web Wallets
Web wallets are a nightmare because they aren’t safe. You don’t have access to your private keys. The best they can is to provide a platform to move crypto from one place to another. One popular web wallet is Coinbase
Coinbase
Coinbase
This is an online broker exchange through which you can buy and sell cryptocurrency with Fiat using USD, EUR and more. When you purchase a crypto on Coinbase, it’s kept in Coinbase web wallet.
The biggest disadvantage with this wallet is the risk they carry is more than software wallets. For instance, if Coinbase system gets hacked, you end up losing all your fortune.
In summary, stay away from online wallet platforms. They can be hacked anytime and many of them don’t provide private keys. If you have your coins on this platform exchange,it’s better to get them out and store somewhere else.
Software Wallets
They are similar to web-based wallets since they are installed on a computer when connected to the internet. This means, because of the internet access, you can hack them remotely. On the other hand, these wallets are the best if you trade cryptocurrency in low volumes. Electrum and Exodus are the most popular software wallets.
Electrum
Electrum Wallet
This desktop Bitcoin wallet is available for download. It runs on Mac OS, Windows, and Linux. Despite the popularity of this wallet, it is the most technical software wallet. In other words, this software isn’t for you if you are new to Bitcoin and crypto.
The fee adjustment setting is the biggest advantage of this wallet. The fee goes up when the Bitcoin network becomes busy. Electrum enables subscribers to modify transaction fee to speed up the process.
Exodus
Exodus Wallet
Exodus supports multi-coin exchanges including Bitcoin, Ethereum, Dash, Litecoin, and Dogecoin. The wallet enables you to manage your keys. Still, it displays your investment in a simple and understandable chart. Above all, you can customize it.
Though, software wallets are good but won’t suit everyone. Consider another type of wallet if you are holding a huge amount of cash. For instance, you can opt for a paper wallet or hardware wallet. Nevertheless, software wallets are better than web wallets.
Hardware Wallets
They are known as “cold storage” and they are the safest wallets to store cryptocurrency. They are offline and more secure than most hot storage wallets. They have high built-in security features. The hardware wallet which resembles a flash drive has improved security. For this reason, no one can access it without the correct password.
Hardware wallet can be a pain in the nerve if you lose it. If you do, then your cryptocurrency is gone, parished. You may not restore it if it gets corrupted too. In the end, you lose your treasure. Still, they have become targets.
Hardware wallets, however, are not cheap because you are buying a digital safe. This software is a USB drive with memory and security. They cost from $85 upwards and some cost as high as $1,000.
Hardware wallets are a good choice if you plan to trade cryptocurrency with some regulations. Also, it’s perfect if you want an offline crypto wallet protection. Keep in mind you have to master the access codes. If you lose them, you’re done!
The Verdict
As a cryptocurrency investor, you need a wallet and it’s in your best interest to choose the best. In a general view, hot wallets are not 100% safe. They are only good for small trades. Hardware wallets, on the other hands are good for investors with regular big cash.
Offline wallets are better because it’s like keeping your treasures in a vault. You are the only one who has the codes. So, before you venture in cryptocurrency, think about your wallet and chose the best.
Image Courtesy of Pixabay.
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