Among the necessary tools for investing in cryptocurrencies, a crypto wallet is probably the most essential. A crypto wallet is just like the ordinary wallet we use to keep money, only that crypto wallets store cryptocurrencies.
Most trading platforms will convince their users to store their cryptocurrencies on their platforms after an exchange. Even though this offer looks appealing, the best and safest way to ensure that you have complete control of your holdings is by having a crypto wallet to transfer your assets to after trading. The team from Crypto Genius has agreed to shed some light on the mystery of crypto wallets.
How a crypto wallet works
Crypto wallets come in different forms. For example, a software wallet can be accessed via a computer or a smartphone and a physical device connected to a laptop, and details can be accessed from there.
A crypto wallet has keys, namely: A public key and a private key. The public key can be accessed since it is available publicly. However, just like the “key” in the name suggests, it should be kept secret and not disclosed to anyone.
The private key is the main attribute of a crypto wallet because it is responsible for tracking cryptocurrency ownership. The two keys work together where the private key decodes the message from the public key.
Type of crypto wallets
There are two categories of crypto wallets, as seen earlier. Most of the time, you will encounter terms like “Hot” or “Cold” storages.
Hot wallets refer to wallets that store their information on the internet. Most crypto wallets tend to fall under this category. Hot wallets make it easier for traders to perform transactions of their cryptocurrencies since the transfers are more manageable because their holdings are stored on the internet. Another advantage of hot wallets is that they are free, unlike cold wallets.
On the other hand, cold wallets are crypto wallets that store cryptocurrencies offline. Cold wallets are the recommended wallets for crypto traders who own a large volume of cryptocurrencies or traders who intend to hold their cryptos for a long time. Cold wallets are safe since they are not prone to hackers, unlike Hot wallets, whose information is stored on the internet. However, this type of wallet is expensive to acquire.
The following are some of the hardware wallets you might consider.
Ledger Nano x
This hardware wallet is the best among all hardware wallets. So what makes this wallet stand out from the rest of its kind? A variety of features have made this wallet be the best hardware wallet, mainly because it can connect to devices like tablets and smartphones through USB and Bluetooth technology, unlike its counterparts that connect via USB only.
Ledger nano X supports over 1000 cryptocurrencies which favor users who own multiple cryptocurrencies. The best thing about this wallet is that they keep adding new cryptocurrency support annually.
The user interface on this wallet is intuitive, and users can easily navigate with ease while managing their portfolios. Users can link up to 100 wallets on this device
Trezor Model T
Security is the most crucial thing in crypto trading. If you desire a hardware wallet and security is your top priority, then Trezor model T should be your choice. The wallet has solid and advanced security features to ensure the safety of your cryptocurrencies.
The wallet, despite being cold storage, has an integrated exchange. The integrated exchange allows the users to trade directly from the web interface where they sell and buy their cryptocurrencies. The device also has a touch screen for users to interact with.
Talking about security, the device comes with a memory card slot. The memory card slot is intended for users to use their memory cards to encrypt their pins hence enhancing the security of their wallet. The wallet also has a USB Type-C that users can use to connect to their computers and smartphones. The biggest downside to this wallet is the absurdly high price.
Ledger Nano S
Spending less on a hardware wallet is something most people would enjoy. Ledger Nano S is cheaper than the other alternatives. The price of this wallet is $59.
Supporting over 1500 cryptocurrencies, it is worth the price. At such a price, the wallets support just six wallet applications. Ledger nano s wallet does not have a USB Type-C, making it hard for users to connect with smartphones.
Types of software wallets
The following are some software wallets you might choose.
The exodus wallet is the best-recommended software wallet for beginners. The wallet supports over 100 cryptocurrencies. Crypto trading beginners tend to make mistakes, and the Exodus team put this into consideration. Therefore, ensuring there is a customer support system that will help users in an incident or need any guidance.
Exodus users can set custom fees that will favor them when trading, hence saving by lowering costs. Despite the wallet favoring new beginners, experienced users might not opt for it since it doesn’t have some features.
If you prefer mobile over desktop, then you should consider Mycelium. Mycelium has an integrated exchange where users can trade. Mycelium supports hardware wallets. With the ability to set custom fees for a trade, the users save a lot and are not restricted by fixed fees or high fees.
What to consider when choosing a wallet
Before choosing your preferred crypto wallet, you might consider the following;
As seen earlier, prices vary from wallet to wallet, especially on hardware wallets. If cost is your primary cause of concern, opt for a cheaper hardware wallet or hot storage.
Different wallets have several cryptocurrencies they support. If you want to trade in various cryptocurrencies, choose a wallet that supports a large number or ensure the wallet you chose supports the cryptocurrency of your choice.
Security should always be your number one priority. Choosing a crypto wallet with enhanced security will give you peace of mind, and your only focus will be trading.
There is a variety of crypto wallets to choose from. Choose a crypto wallet that meets your needs as a crypto trader, and also, don’t share your wallet’s keys with anyone to avoid the risk of losing your cryptocurrencies.