Are you looking for some information on cryptocurrency wallets?
Well, this is where you must be then. You are probably investing in cryptocurrencies or planning to invest if you end up here on our site.
So if you are here because of either of the previously mentioned reasons, then it is superb! You will eventually discover the sheer significance of cryptocurrency wallets and how they play a significant role in safeguarding your digital funds.
You are going to receive a lot of information about cryptocurrency wallets in the following guide. So we will begin by discussing, in brief, the basics of what exactly cryptocurrency wallets are.
We will then explain the different digital currency wallets and the most famous options in the digital marketplace. If you search specifically for a part of the digital currency wallets’ information, then directly read those. However, we recommend you go through the whole article to understand cryptocurrency wallets better.
What Are Cryptocurrency Wallets?
Typically, cryptocurrency wallets are simple software programs that play two critical roles for their users. Firstly, they provide secure storage of private cryptocurrency keys. Secondly, they enable their users to send and receive digital currency funds from anywhere to anywhere. We will elaborate on the importance of both the points below.
So, in case you do not know, private keys provide you access to your investments. Only with these keys will you be able to make transactions.
Supposedly, your private keys get hacked, then most probably, you will lose all your cryptocurrency investments present in that specific wallet. Therefore, the private keys are an essential part of your crypto wallet, and they must be implemented to safeguard your cryptocurrency investments.
Another advantage of cryptocurrency wallets is that they allow crypto users to buy and sell cryptos effortlessly. Just because the cryptocurrencies’ whole system is based digitally, there is a need to use an exchange or wallet for transferring the funds around.
The most fantastic factor of using a cryptocurrency wallet is that this feature is built-in, along with safe storage of the private keys of your wallet.
You will discover in the next section that there are numerous different types of cryptocurrency wallets. You have choices from a piece of paper to an innovative and specialized USB.
Different Types of Cryptocurrency Wallets
If you are hunting for a cryptocurrency wallet to use, you will have various wallets you can choose from. In this section of the blog, you will discover the basic types of crypto wallets in present times.
While going through the types, you will find the wallet that intrigues you the most and fulfills all your security needs. Remember that you can always use more than one cryptocurrency wallet type. We will elaborate on this under the section on how to safeguard your funds.
Paper Wallet – At first, we would like to uncover the simplest of all the crypto wallets that are that paper wallet. , the paper wallet is nothing but mere paper. If you choose the paper wallet, you will write the private keys on a notebook and protect them in a safe place.
The benefit of securing funds in a crypto wallet is that it does not connect your keys in any way to the internet. So, the fear of hacking and stealing completely fades out. The majority of people prefer such wallets due to their simplicity of using paper and a pen for recording essentials.
However, a major con is here is that they can be lost. Often people secure them in such a secure place that they forget the storage location of their paper wallets. Resultantly, people end up losing private cryptocurrency keys for nothing.
Therefore, we recommend making numerous copies of your private keys and keeping them in different places. So, even if you forget one location, you might find the keys stored in other locations. The best spots to hold your paper wallets are home safes, safety deposit boxes, and secret places that nobody except you can imagine.
Hardware Wallets – The next type of cryptocurrency wallet is hardware wallets. Appearance-wise they look like any other USB flash drive. The term hardware is used for these as they are in the hardware format. So, the hardware wallets are designed with built-in top-notch security to keep your private cryptocurrency keys secure.
Like paper wallets, the advantage of hardware wallets is that they do not store your private keys online, preferably offline. Hence, the risk of hacking is eliminated from the core here as well. All in all, hardware wallets are an excellent pick if you do not trust the online platforms for securing your private keys.
Desktop Wallets – Next in a row are desktop cryptocurrency wallets. As the name says it all, you will find these wallets on your desktops. If you choose desktop wallets, you will have to download crypto wallets’ software on your desktop.
This form of cryptocurrency wallet is relatively safe. The primary reason behind the statement is that only that computer can access the wallet on which the software is installed.
Nonetheless, there are chances of a virus attacking your computer. In such cases, your private keys might be under hacking and stealing risks. Unfortunately, people lose all of their cryptocurrency funds when this happens.
Online Wallets – Another interesting cryptocurrency wallet type is an online crypto wallet. As the “online” word gives a clue about it, these wallets function online through websites. The most appealing fact about web/online wallets is that you can access them from anywhere at any time, even on the go.
Where these wallets are easy to access, they come with certain risks. Online wallets are based on the web, and other companies control them.
Therefore, in this type, your private keys are vulnerable to numerous security thefts and closure. Let’s suppose the online wallet service you use suddenly closes its company without providing you with any information. Eventually, you will lose your cryptos and will not have any chance to get them back.
Mobile Wallets – The last type of section is mobile cryptocurrency wallets. These are similar to the desktop wallets as here, too your wallet is on a device, but rather than a desktop, the device here is a mobile phone. So, it is a more accessible wallet in comparison to other wallets. You can quickly transfer funds and access your keys while you are on the move.
However, you must know that mobile wallets are not entirely safe yet. If your phone gets stolen or hacked, then the hacker might gain access to your keys and the funds as well. Thereby, we suggest you all secure your phone with a lock, preferably face lock or fingerprints, to avoid such happenings.
We kindly recommend you to consider that applications that function the mobile wallets are comparatively smaller than their desktop counterparts. Hence, you will not store a large amount of information like you can on the desktops. If you have a wide variety of different cryptocurrencies in your wallet, it is not an issue.
Famous Cryptocurrency Wallets – If you are looking for top-class cryptocurrency wallets for securing your cryptocurrencies, this section is specifically for you. In this article, we will uncover the most reliable and popular cryptocurrency wallets available. Although the list is not comprehensive of all wallets, it offers you a launching pad of some you can search for as potential wallets.
Ledger Nano S (Hardware Wallet) – If you find hardware wallets intriguing and wish to choose the best of them to safeguard your cryptocurrency funds, then Ledger Nano is the best option. Factually, the most famous hardware wallet in the market is Ledger Nano. The crypto wallets support different digital currencies and come with a safe multi-signature security format for you.
Armory (Desktop Wallet) – A trendy name for desktop wallets is Armory. People who are looking for desktop wallets that offer enormous security features go for this desktop wallet.
Undoubtedly, what fascinates people are their stellar secure touches that make Armory a top-notch desktop wallet. Other features of the wallet include one-time printable backups, multi-signature transactions, and cold storage.
Jaxx ( Web and Mobile Wallet) – Among the best online wallets is Jaxx. It is incredibly famous among users because of its multiple currency support, including top ones like Bitcoin and Litecoin. Along with the benefit of accessing the wallet online, you can also get their service on your mobile phone.
Moreover, if you are holding many types of cryptocurrencies, then Jaxx is an excellent wallet for you to choose from.
Mycelium (Mobile Wallet) – Mycelium is one of the top dogs in the mobile wallet realm. You can use their application to access your private crypto data via your Apple or Android devices.
Mycelium is a mobile wallet with numerous security features that help you protect your funds and private keys. The major drawback of the mobile wallet is that it currently supports only Bitcoin. However, we expect Mycelium to add other digital currencies in their application.
How to Safeguard Your Cryptocurrency Wallet
Although using a cryptocurrency wallet is a fantastic thing to do, it is not the only thing you must take care of. Additionally, there are also other things that you should ensure for safeguarding your cryptocurrency keys and funds. The following section gives the best tips for securing your cryptocurrency keys and investments, along with having the best wallets.
Therefore, we suggest you implement the top three tips discussed below to limit the chances of falling into issues that affect your private keys’ security.
- Regularly Update the Software
If you are using wallets with occasional updates, you must make sure that you keep updating your software as frequently as possible. The updates of the wallets are usually to enhance the security features of the wallets.
Hence, we recommend checking your wallet’s software updates once every month to ensure that the software edition you have is the most recent one.
- Create a Backup of Your Wallet
No matter what type of wallet you are using, you must create a cryptocurrency wallet backup. For instance, if you are using a paper wallet, you must also use hardware or online wallets as a backup. Let’s suppose you lose your paper wallet so that the backup will help you here, and you will, fortunately, have access to your digital funds and private keys.
- Add Extra Layers of Security in Your Wallet
Remember that owning a crypto wallet is just the first step to safeguard your cryptocurrency funds. We have mentioned some additional security layers below to add extra protection to your wallets. So make sure to apply a few or all of these layers along with owning a wallet.
- Use two-step verification
- Create strong passwords that are lengthy and complex
- Use wallets that have stellar reputations only.
- Use multi-signature options that demand the permission of a second person for confirming transactions.
Additional Resources
If you require comprehensive information on cryptocurrencies other than wallets, you do not miss this guide section. In this section, we bring additional cryptocurrency resources that will help you in increasing your knowledge. If you think you cannot dig into the information right now, then bookmark our page to visit later when you are available.
Cryptocurrency Beginner’s Guide
We have created a fantastic cryptocurrency beginner’s guide to guide newbies in the marketplace to learn the ropes. If you are not experienced in digital currencies, this section will help establish your cryptocurrency base.
You can refer to the above guidance section to deeply know what exactly are cryptos, how do cryptocurrencies work, where you can purchase them, along other information.
Cryptocurrency FAQ Page
Undoubtedly the concept of cryptocurrencies is complex, and you might have numerous questions on your mind regarding them. So, you can click the link below to our cryptocurrency FAQ page. There is a long list of FAQs on the page that are commonly asked by cryptocurrencies.
Last but not least
Hopefully, now you are well aware of the crypto wallets and their functioning. We hope that we provided you with all the information that you were looking for.
However, if there is more confusion and you are searching for additional cryptocurrency resources, then recheck our other resources section given above. Also, we sincerely thank you for reading the guide thoroughly. Lastly, we wish you the very best of luck for your future in the cryptocurrency market, as you have a lot to explore!
FAQ:
Which crypto wallet is best for me?
We cannot provide one answer to the question as there is no one-size-fits-all in crypto wallets. The best digital currency wallet for you might not be the right one for another individual.
Therefore, firstly you will need to identify your preferences and requirements regarding hardware or software wallets once you know what you want and why; search for a trustworthy wallet that delivers you the best security features.
Do I need to use more than one crypto wallet?
It is not just for everyone to use multiple or more than one cryptocurrency wallet. Nonetheless, we recommend the people add an extra setup to their wallets.
Individuals owning a desktop or mobile wallet should prefer using more than one wallet, as if your computer or phone crashes, you will give a whole backup of your funds and private keys. So, you will not lose anything with a backup.
Do I have to use a crypto wallet?
You are not bound to use a crypto wallet. However, we highly recommend you to use one, considering their safety features. As we have mentioned above, you will lose your cryptocurrency funds forever if you lose your private keys.
Therefore, please play safe, especially when it is about your hard-earned money. It is on you whether you must or not to use crypto-wallets at the end of the day.
Are cryptocurrency wallets safe?
Although every wallet comes with security features, these features differ from wallet to wallet. Generally, online and desktop wallets are less secure in comparison to hardware or paper wallets. To find the pros and cons of these revolutionary wallets, check our types of wallets section above.
Are cryptocurrency wallets anonymous?
No, crypto wallets are not anonymous. Although private information of yours like name and address remain anonymous, things can yet be ties back to you. It is just like owning cryptocurrencies. The blockchain does not know who you are, yet it has information about your IP address and other information that may help identify the digital currency owner.
