The terms Bitcoin, crypto, and blockchain have become a part of everyday life and the conversation of many investors around the world. Since its emergence in 2009, Bitcoin has become a sensation despite its novel and volatile nature.
If you're looking to invest in Bitcoin or other altcoins, you'll need to pick an investment app to buy and trade crypto and additionally, a "wallet" to store and secure your private key code to access your digital assets.
As we assist in the task of helping you choose what is the best wallet for cryptocurrency with this list, there are a few other key things to be aware of including the difference between hot and cold wallets. In essence, hot wallets are a less secure way to make transactions, but the transactions are done very quickly. Cold wallets, on the other hand, are more secure and are designed for your cryptocurrency to stay put for a much longer term.
In this article, we'll not only learn about bitcoin wallets and how they work, but we’ll also share the best wallet for cryptocurrencies list and how you can choose the best one for you.
What Is A Bitcoin Wallet?
A Bitcoin wallet is a software wallet in which you can store your Bitcoins. Since Bitcoin does not exist in any physical shape or form, it can't technically be stored anywhere except coin wallets. These types of software wallets are easy to use, reliable, secure, and fast.
What are the top 3 Hardware Crypto Wallets?
How Does A Bitcoin Wallet Work?
In essence, a Bitcoin wallet is similar to a physical wallet. But instead of letting you store currency physically, a Bitcoin wallet stores your secret data (called a private key or seed) and uses the key to sign transactions as a proof that they indeed have come from the original owner. In other words, a Bitcoin wallet helps you carry out crypto transactions by securing your private key to access your Bitcoin addresses.
During transactions, each Bitcoin wallet uses this secret data to sign and validate transactions. The ‘signing’ proves that the owner of the wallet is the buyer or the seller ensuring the safety of the wallet. For enhanced security, one could also keep a copy of their private keys and secret data on a piece of paper.
What Is The Best Bitcoin Wallet In 2021?
1. Exodus
Exodus is one of the bitcoin wallets with a very simple user interface and an exchange built-in. One of their most popular features is the ability to swap between a growing number of cryptocurrencies. Exodus currently allows you to swap between over 100 different cryptocurrencies.
Top Features
- Type of wallet: Hot wallet
- Purchase cost: Free
- Compatible hardware wallet: Trezor
- Incorporated exchange: Yes
- Cloud Storage: No
- Cold Storage: No
Pros
- Variety of cryptocurrencies
- Integrated with Trezor
- Great customer support
- Desktop-first app that supports over 100 assets
- High-quality user interface
- Built-in exchange
Cons
- Closed source software
- Two-factor authentication absent
2. Electrum
Two years after Bitcoin was created, Electrum was launched and specializes in private key encryption and two-factor authentication. Like Exodus, Electrum also is a hot wallet that gives you online encryption for all your crypto information.
Top Features
- Type of wallet: Hot wallet with the option for cold storage
- Purchase cost: Free
- Compatible hardware wallet: Trezor, Ledger, and many more
- Incorporated exchange: No
Pros
- More secure than other hot wallets
- Customizable seed phrases
- Open-source software
- Customizable transaction fees
Cons
- Works only for Bitcoin
- Most basic user interface
- Lack of customer support
3. Mycelium
Most of us do all our digital tasks on our phones and so, having a mobile-friendly option that works on your tablet or phone is preferred by most. Mycelium ranks as the best bitcoin wallet for Android and iOS devices being an open-source and mobile-only Bitcoin wallet, which currently supports Bitcoin, ETH, ERC-20 tokens, and FIO token. It also has a few extra features that make it stand out among its competitors including hardware wallet support.
Top Features
- Type of wallet: Hot wallet with the cold option
- Purchase cost: Free
- Compatible hardware wallet: Trezor, Ledger, and KeepKey
- Incorporated exchange: Yes
- Fees: $0.25 -$7
- Cloud Storage: No
- Cold Storage: Yes
Pros
- Download and get started for free
- Ability to use hardware wallets
- Open-source software
- Make payments, transfers, and exchange cryptocurrencies
- Very high security, including offline (cold) storage
- Customizable transaction fees
Cons
- Mobile-only
- Confusing for a first-time user
4. Ledger Nano X
Ledger Nano X, the second generation hardware wallet from Ledger was launched in 2014. Ledger’s first cryptocurrency product, the Ledger Nano S, was one of the first hardware cryptocurrency wallets on the market and dominated the crypto wallet arena for several years.
Ledger Nano X can easily be the best bitcoin wallet as it supports over 1,500 cryptocurrencies with more being added each year. Ledger Nano X is a cold storage hardware wallet but there is also a companion Ledger Live software that includes a user interface for all of your holdings.
Top Features
- Type of wallet: Cold wallet
- Purchase cost: $119
- Incorporated exchange: Yes
- Fees: N/A
- Cloud Storage: No
- Cold Storage: Cold
Pros
- Ledger Live has an intuitive and convenient user interface
- Stores up to 100 different apps
- Open-source software with many benefit of customer and community support
- The convenience of Bluetooth connectivity
Cons
- Bluetooth considered a potential vector of cyberattack (USB is still an option)
- Bluetooth feature isn't as smooth as it should be
- Limited wallet storage
5. Trezor Model T
Trezor, like Ledger, is considered a cold wallet since it primarily offers offline storage through an external USB-like device. Its Model T is the second generation of hardware wallets they have created. It functions similar to Ledger but gives the users the ability to access third-party exchanges like Shapeshift and Changelly.
Top Features
- Type of wallet: Cold wallet
- Purchase cost: $181
- Incorporated exchange: Yes
- Fees: N/A
- Cloud Storage: No
- Cold Storage: Yes
Pros
- Web-based user interface with built-in exchanges
- A huge list of supported cryptocurrencies
- Open-source software
- Unlimited number of wallets available simultaneously
- Benefits of customer and community support
Cons
- Higher price point than others
- Small touchscreen for typing
- Complicated setup for new users
How To Choose The Best Bitcoin Wallet?
- You can evaluate bitcoin wallets based on longer-term interface, and customer reviews—as security and safety should be your biggest consideration.
- Any wallet you choose must be widely adopted and have lots of safety protocols in place to keep all of your investments safe.
- Choose a wallet that will work with larger exchanges to facilitate quick transactions.
Final Verdict
If you want to store your cryptocurrencies safely, then having the best wallet for cryptocurrencies is a must, as you could leave yourself open to security breaches that may cost big time!
And, you'll certainly want to have the best bitcoin wallet that can bring together both security and accessibility. Our list of crypto wallets has been carefully curated keeping fees, security, storage, and user interface in mind, and is a good place to start when looking for your ideal cryptocurrency wallet.
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