A difference from your old physical wallet that keeps your bills and coins, a crypto wallet it doesn’t actually hold your cryptocurrencies like Bitcoin and Ether. Instead, it contains the access keys you need to prove ownership of your crypto assets and access them on the blockchain.
The crypto wallets can take the form of external hardware or software devices that run on your mobile device or computer.
And while its primary function is to keep your crypto secure and allow you to make transactions, they also offer more control over your digital currency than you’ll get with a standard account at a crypto exchange or brokerage.
Bitcoin is the most famous cryptocurrency in the world.
Bitcoin custody wallets: yes or no?
Some brokerages and payment services such as Robinhood, PayPal, Venmo and Cash App They allow you to easily buy bitcoin and other cryptocurrencies without a cryptocurrency wallet.
These services store your digital currency for you in their own “custodial” wallets, meaning that you are trusting the company to secure, protect and maintain your crypto. Ultimately, they are in control and you will need to trust them to act on your behalf.
Unless you are day trading cryptocurrency or only have a modest amount of money invested in cryptocurrency, we recommend that you do not store your crypto in a custodial wallet.
Best practices for holding cryptocurrencies include purchasing a hardware wallet for offline storage. Your next best option is a “non-custodial” software application or wallet. We will look at both options in this iPro note to help you find the best crypto wallet for your own situation.
Although it has a physical representation in the media, cryptocurrencies are 100% digital assets.
The best Bitcoin and cryptocurrency wallets
Coinbase: the best for beginners
Coinbase is the best known cryptocurrency exchange in the US The company makes it easy to exchange popular cryptocurrencies, from Bitcoin to Dogecoin, and has its own Visa-backed debit card that integrates with Apple Pay and Google.
If you are new to the world of cryptocurrencies, Coinbase Wallet is a good place to start. You can download an app for Android or iOS, the interface is intuitive, and the wallet is fully integrated with the company’s exchange, making it easy to transact, including buying coins and tokens with traditional currency.
Unlike the company’s exchange, Coinbase Wallet does not have custody. That means only you have access to your wallet’s private key, which is generated with a 12-word recovery phrase when you sign up.
You should keep in mind that there is a difference between storing your cryptocurrency on the Coinbase exchange, which is custodial, and the wallet, which is not. But the integration between them makes it quite simple to transfer funds from side to side.
Trezor: the best security features
The new user interface of Trezor, Trezor Suite, recently came out and replaced the company’s Wallet Web app. Trezor has been around for quite some time, having been established in 2011 as a subsidiary of SatoshiLabs, based in the Czech Republic.
The Model T, which it costs 280 dollarsis Trezor’s second-generation hardware wallet and comes with many of the same features as the Ledger Nano X. One major difference is that Trezor’s software is open source, which provides some additional protection, at least in theory. .
The code that feeds the wallet is available for scrutiny And, as the saying goes, sunlight is the best disinfectant. Trezor Suite is designed to run natively on your desktop.
This generally provides better security than a web-based application, although you can also access the Trezor Suite through the company’s website. Trezor wallets support over 1,600 coins and tokensand you can transact directly in the Trezor Suite with the company’s integrated exchange.
Shaped like an old school stopwatch, the Model T It comes with a touch screen and a USB cable to connect it to your computer. There’s also a microSD card if you want to add encrypted storage directly to your hardware wallet.
Nevertheless, does not have bluetooth supportan omission preferred by some security advocates, as Bluetooth connectivity could be an attack vector for hackers to exploit.
Ledger Nano X: a good balance between accessibility and security
The Nano X is Ledger’s second generation cold storage wallet. The integrated Ledger Live platform, which is easy to learn and use, supports over 1,800 coins and tokens, including Bitcoin and Ether.
the wallet, which it costs 149 dollarsit can be connected to your computer via USB cable and Android and iOS mobile devices via Bluetooth, a connection that the Trezor Model T lacks.
The device is rugged and features a small LED screen. To get started, you’ll set up a PIN, then a 24-word seed phrase. The seed phrase acts as the private key of your wallet. Like other wallets, as long as you keep the private key safe, you will not lose your crypto assets, even if you lose your wallet.
It’s important to put attention on Ledger suffered a data breach in July 2020, which resulted in the theft of some customers’ personal data, but not their crypto assets. No private keys were taken from wallets, but there were reports of customers receiving “phishing” emails and other scam threats afterward.
Ledger was long a trusted name in the crypto world, but the data breach is a good reminder to be careful onlineespecially when it comes to trading crypto assets.
Exodus: Best for Desktop Users
Exodus is a hot wallet, which means it’s a software wallet that is connected to the Internet. However, it is non-custodial, which means that only you have access to your private key, a 12-word passphrase that protects access to your crypto assets.
Exodus wallet is designed to run on computers Mac, Windows and Linuxalthough a companion app is available for Android and iOS devices.
The desktop user interface is elegant and easy to learn. Your wallet is seamlessly integrated into the Exodus exchange, making it easy to transact. exodus supports more than 130 types of cryptocurrenciesincluding Bitcoin, Ether, Tether USD and Dogecoin.
But the exchange has some notable limits: If you want to buy crypto with dollars and store it in the Exodus wallet, you’ll first need to buy the asset from a centralized crypto exchange, such as coinbaseand then transfer the assets to Exodus.
The app version allows Bitcoin purchases with dollars. And once you have an asset in your wallet, you can easily exchange it for other supported assets. While the wallet itself is free to use, Exodus charges a fee for transactions made through its exchange.
The hot storage wallets They are generally considered less secure than cold storage wallets, and some Exodus users may want to upgrade to cold storage. The good news for them is that Exodus is fully compatible with Trezor’s One and Model T hardware.
Mycelium: Best for Mobile Users
Mycelium has been around since the beginning of the cryptocurrency era, and its wallet is one of the oldest and most well-known bitcoin wallets. It is a mobile-only wallet, there is no desktop version, and it is compatible with Android and iOS.
The Mycelium wallet has a simple interface, but it supports fewer types of crypto than others reviewed in this note. You can send and receive tokens from Bitcoin, Ether and ERC-20, such as Tether USD, USD coin and Binance USDbut not the hundreds of currencies that have been developed in recent years.
You can buy and sell bitcoins directly in the app, and Mycelium allows you to buy bitcoins with regular fiat currency. The Mycelium Wallet does not have custody, so you will have exclusive access to your private key and PIN. This wallet is also the only hot storage wallet on this list that is open source.
Although there are security advantages to that, it also comes with limited support options. If you get stuck, you can submit a support ticket to the email address listed at the bottom of the web page.
For more advanced users, Mycelium supports QR codesallows you to set custom transaction fees, and offers support for hardware wallets from Trezor, Ledger, and KeepKey.