Learn About the Top Crypto Wallets

Investing in cryptocurrencies requires the use of a crypto wallet. Crypto wallets facilitate the sending, receiving, and spending of various cryptocurrencies including Ethereum and Bitcoin. Encrypted security protocols also protect your private keys and other applicable information without limiting accessibility.

Several types of crypto wallets are available. Similarities exist between them all, although each type also has specific pros and cons. Different brands of wallets are also available. Continue reading to learn all you need to know about crypto wallets today.

Crypto Wallets 101 (Here’s What They Are)

Crypto wallets hold private keys. Private keys require user-created passwords to access and utilize the cryptocurrencies they contain. Encrypted security protocols further protect private keys and other applicable information without limiting accessibility to your wallet. Learning how crypto wallets help you send, spend and receive different cryptocurrencies is important prior to choosing a wallet. First, however, is important to understand the basics of cryptocurrency.

Understanding Cryptocurrency Basics

Cryptocurrency is a digital currency utilized for purchasing, trading, selling, and investing in tangible products. Cryptocurrency investments are also made for prospective financial gain. Bitcoin was the original form of cryptocurrency one the market. Bitcoin maintains a strong influence one the market today, although numerous other crypto companies now also have a strong presence. Each cryptocurrency company offers a proprietary crypto coin (or token). The crypto system utilizes blockchain technology to secure the privacy and protection of financial transactions. At the essence of the Blockchain system is an advanced technology based on decentralization. This decentralized online database and storage system largely avoids the central banking system. The Blockchain system also utilizes encrypted, timestamped blocks of information chained together for additional security.

Crypto Wallets - Learn These Basic Types (and their benefits and drawbacks)

Three primary types of crypto wallets are available. Ranging from simple to complex, these cryptocurrency storage and security solutions each have their pros and cons. The three main types of crypto wallets and a few of their pros and cons include:

• Paper.

• Hardware.

• Online.

Paper

Paper crypto wallets are the only type of wallet written onto a physical location such as a piece of paper. Paper wallets are stored in secure locations such as safes and safety deposit boxes, etc. Pros of using paper crypto wallets include the lack of a digital footprint. Cons involve the same aspect, however. Because digital monies are only accessible and usable online, having a paper wallet creates several logistical challenges. Essentially, it requires more effort to use a paper crypto wallet than it does to use the other main types. If you wish to avoid leaving as much digital footprint as possible, however, a paper wallet might be a suitable choice.

Hardware

Hardware crypto wallets utilize USB flash drives (or thumb drives). Hardware wallets must also be stored in a secure location when not in use. To use yours, simply insert the drive into a compatible computer. Cons of using a hardware crypto wallet include the possibility of losing it when carrying it on-the-go. These drives must be removed from storage and inserted into a computer for use. This creates some inconveniences like those caused by paper wallets. Primary benefits include the combination of convenience and security. These drives are easy to store. If the drive is encrypted, no one without real cyber-hacking skills is able to use your drive. Hardware crypto wallets are perfect for investors looking for more convenience than offered by paper wallets, albeit with similar levels of offline security.

Online

Online crypto wallets are either software or app-based programs. When purchasing an online wallet, it is advisable to purchase one secured by a two-step encryption protocol. Cons of this type of wallet include user reliance on security measures provided by each wallet provider. This means your wallet might be exposed to more potential breaches if your provider is hacked. Online wallets are highly convenient, however. In fact, major exchanges such as Coinbase offer proprietary online wallets to users when they sign up for the exchange. This is by far the easiest method of obtaining a wallet for first-time cryptocurrency users. Online crypto wallets are the best choice for users who value convenience and the ability to access crypto accounts with the same speed and ease as a normal bank account.

Top Crypto Wallet Brands

Coinbase wallets are widely considered the best available in today’s market. Part of this popularity might be attributed to the platform’s user-friendly approach. This attracts many beginners who are new to the entire cryptocurrency and wallet experience. Some security issues typical of hot storage platforms are a concern. Coinbase wallets are also only available on mobile and tablet devices. This might be inconvenient for users who prefer using their computers for online transactions. Ultimately, however, Coinbase wallets have more pros than cons. The platform supports over five-hundred cryptocurrency assets. Security protocols include two-factor and multi-signature authentication. Coinbase is also a reputable exchange, capable of recouping any lost or stolen assets.

Electrum

Electrum is considered the best crypto wallet specific to Bitcoin. Electrum was founded in 2011, also making it one of the oldest crypto wallets available today. The platform is also highly popular, especially because of its user-friendly compatibility with Bitcoin. Electrum is only available for use with Bitcoin, however. Additionally, this wallet is not designed for ease-of-use for beginners. For moderate-to-expert-level experienced users, however, Electrum offers the following benefits:

• Fast set-up via lightweight client utilization.

• Better security protocols than most other hot wallet platforms.

• Transaction fees are customizable.

• Solid server configurations eliminate inconvenient downtime experiences.

• Simple Payment Verification (SPV) expedites transactions with no compromise in security.

Additional Top Crypto Wallets

Some users prefer a mobile crypto experience. Mycelium is a perfect choice for users with this preference. A few cons include a potentially confusing first-time user experience and limited cryptocurrency compatibility (ERC-20, Ether and Bitcoin only). Mycelium’s security is not as highly rated as certain other brands as well. To counter this, however, Mycelium offers its users the ability to conduct both online and offline transactions. Additional pros include the inclusion of educational material, cold storage solution compatibility and in-app crypto exchanges. The Mycelium platform even offers Single Address savings and HD spending accounts. Additional top crypto wallets available today include:

• Exodus (rated best for desktop users).

• Trezor (hardware wallet; rated best for reliability and security).

• Ledger Nano X (hardware wallet; rated best overall for offline users).

• WalletGenerator.net (best resource for creating paper wallets).

Additional Benefits of Crypto Wallets

Crypto wallets neither hold tangible cash nor do they store your actual cryptocurrencies. These wallets do securely hold your private key, however, which grants you access to your funds. Crypto wallets provide more benefits than this, however. Crypto wallets also:

• Assist in storing all your digital assets in once secure location.

• Browse and shop at different stores where cryptocurrency is accepted.

• Browse dApps, which are decentralized finance apps placed on blockchain computer networks and are designed to safeguard user privacy.

• Send/receive cryptocurrencies to/from all applicable locations around the world.