Wallets for Crypto Currencies
With the rising popularity of Bitcoin and other crypto currencies there has also been a massive increase in the methods of storing them. From online wallets and crypto exchanges to hardware and paper wallets there are any number of choices for new and experienced crypto users and investors alike. The aim of this article is to introduce the various types of crypto currency wallet and discuss the suitability of each type for each situation before providing a list of recommended software wallets particularly suited to use by people who work online on a regular basis.
A crypto currency wallet is essentially a hardware or software device whos primary purpose is to store the public and private keys of one or more crypto currency addresses. Wallets can be as simple as a sheet of paper with several strings of numbers and letters printed on it; a piece of software that runs on a smartphone or personal computer; or a specialized USB device with some memory chips and a small display screen for displaying balances.
No matter which type of crypto wallet a person uses, the underlying purpose and functions are the same. A wallet stores pairs of public and private keys for at least one crypto currency address, and quite often, many more than that.
A wallet allows the owner of crypto coins to send and receive coins to and from other users, and to interact with the blockchain in order to view transactions and check their coin balance.
Choosing the right type of crypto wallet can be an important decision, and can be influenced by a number of factors, such as, security, convenience, access to the internet, and cost. Each type of wallet has its own characteristics and can be analysed in terms of each factor to determine its suitability for a user's purpose.
For instance, a crypto user who is constantly online and is dealing with relatively small amounts of crypto currency might find that an online wallet or a desktop wallet on their pc is te most suited to their needs, whereas an investor with large crypto or Bitcoin holdings might be more inclined to use a hardware wallet with a paper wallet as a backup, in order to provide the highest level of security for their investment. Paper wallets are inherently 'very' secure due to their physical nature, and the fact that they are totally “offline”.
Desktop and mobile (apps for smartphones and tablets) wallets offer a high level of convenience, and make it very easy to conduct transactions, however they generally offer a lower level of security than hardware wallets do. That being said, many desktop wallets do offer various levels of security in the form of passwords, encryption etc, and can generally be deemed to be suitable for storing a modest amount of crypto currency for daily use.
Online wallets are among the least secure of crypto wallets, as the private keys are often held in a third part database, although this is not always the case. Nevertheless, online wallets do have the advantage of being accessible from any internet connected device, so can be a highly convenient way for travellers to store their currency when on business trips, holidays, and the like.
Another method of storing crypto currencies is in accounts with some of the large crypto exchanges. This can be a very convenient way of storing crypto coins, especially for traders and other people who work online a lot, but again, exchanges can be hacked, and normally do not give the user direct control over the private keys, so there is always an element of risk involved with storing cryptos in that fashion. in any case, it is never recommended to store large amounts of crypto currency in any exchange account, as these type of accounts have been known to be frozen by exchanges from time to time and for “no apparent reason”.
A crypto user needs to determine the level of security and convenience they are satisfied with when choosing and setting up their crypto wallets. For instance, coins stored in online wallets and exchanges are always “more secure” when 'two-factor-authentication' is used, however, the convenience factor is slightly reduced. An online wallet that uses a single password and a 'captcha' at the login screen can be very convenient for users who deal with a modest amount of coins, but probably don't an acceptable level of security for large amounts. Again, it is up to each user to determine an acceptable balance of security and convenience for their own purposes.
Regardless of which type of wallet a person uses, it is always a good idea to make a hard copy of the public and private keys, password and backup/recovery phrases for all wallets. Coins can normally be retrieved in the event of a computer malfunction when the recovery phrase has been recorded, bit if it has not been recorded then the user can generally kiss those coins goodbye.
Here is a list of various wallets for a number of crypto currencies. Some of these may or may not be suitable for a person's particular needs but there is really nothing to stop someone from using more than one type of wallet to store their crypto coins in.
Online wallets and exchanges
Online wallets and exchanges are grouped together here because their main functions are very similar, with exchanges obviously being geared more toward trading. Readers are advised to check reviews for each or any of these before making a decision, or, alternatively, open accounts with several of them and try each one out for themselves to see what is the best fit for their needs.
Cryptopia is an up-and-coming cypto currency exchange that supports a diverse range of altcoins in addition to Bitcoin. Often used by many crypto investors as an online wallet, Cryptopia has a good balance of security and convenience, with relatively low transaction fees and some outstanding features built into the website. Cryptopia supports the following coins supported by FaucetHub: BCH, BTC, BLK, DASH, DGB, DOGE, ETH, LTC, POT, PPC, XPM, ZEC.
Blockchain.info is an easy-to-use online wallet and blockchain interface that includes a basic exchange. While primarily designed for use with Bitcoin, it also supports a few other major alt coins, and is often recommended as a good starting point for new crypto users.
Eobot is an online micro wallet that also features cloud mining, an exchange function, and a daily faucet. The security level on Eobot is generally not great, however it supports a good range of coins and has some great features built in. The exchange and faucet are cute features that appeal to many people and make an Eobot account a staple for new and experienced crypto users alike.
Coinbase is an online wallet that has its own well known exchange, Gdax. The user interface for Coinbase is fairly simplistic and is generally suited for new users. While this online wallet has had its share of scandals over the years it has stood the test of time and is among the more widely known online wallets, especially among US based crypto users.
These exchanges are also well known for their diverse range of supported coins and a good balance of security and convenience for crypto users.
Desktop wallets offer a generally higher level of security and control than online wallets and exchanges can offer, although in some cases they can take a long time to sync with the blockchains for the various coins that they support, and of course, can only be accessed from the single device they are installed on. For a lot of new and more “obscure” altcoins, desktop wallets provide the most convenient method of crypto coin storage.
Exodus wallet is a visually striking desktop wallet with support for a wide range of crypto currencies and a reputation for outstanding security and ease of use. The Exodus user interface is beautiful, easy to use, and includes a basic exchange function. Sometimes criticised for lacking the ability for users to choose to pay low fees on Bitcoin transactions, Exodus is still a good choice for altcoin enthusiasts and serious Bitcoin investors alike. FaucetHub users and small altcoin investors should keep in mind that Exodus wallet no longer supports Dogecoin.
Jaxx wallet is a highly functional desktop wallet that supports a wide range of alt coins in addition to Bitcoin, although it does not require a password by default at login, so the security factor is considered to be lower than some other desktop wallets such as Exodus. Security concerns have been an issue for Jaxx wallet in the past, however most of these seem to have been addressed. The user interface is simple to use and includes a basic exchange, and FaucetHub users will be happy to learn that Jaxx wallet supports many of the coins used in the faucetHub system, including Dogecoin.
Single Currency Desktop Wallets
Wallets in this category are the official desktop wallets for each of their respective crypto currencies, and only support one type of coin. They do not include any exchange function and the user interface is usually less “glossy” than a multi currency wallet such as Jaxx or Exodus, however they usually do have a good level of security, are relatively easy to use, and in most cases are compatible with payments from crypto 'mining' sites. The wallets here generally require to be 'synced' with their respective blockchains – a process which can take a long time but can often be sped up via certain methods.
Mobile wallets are, as the name suggests, mobile apps for smartphones and tablets that store crypto currencies in a lightweight file format suitable for mobile devices. They generally do not download the entire blockchain for any crypto currency but connect to online servers to update wallet balances, coin prices and other relevant information. The convenience factor associated with mobile wallets is usually very high, however the corresponding security factor is generally a lot lower than that of hardware and desktop wallets. Mobile wallets are great for people on the move, but care must be taken to protect a person's coins, and it is recommended to only store enough coins for day to day expenses and low level trading and investing.
By far the most popular mobile wallet for android users, Coinomi supports a staggering array of crypto currencies. The user interface is clean albeit a little crowded, although that is understandable when the functionality is taken into account. FaucetHub users will be pleased to learn that Coinomi supports all crypto currencies used by the FaucetHub platform with the exception of Primecoin. For Apple users, the Coinomi dev team has announced that work is in progress on an iOS version of the wallet.
MyCelium is a single currency Bitcoin mobile wallet with a reputation for outstanding security and connectivity with hardware wallets. Aimed primarily at experienced investors and Bitcoin users, MyCelium is a highly acclaimed mobile wallet that is under constant dvelopment and improvement.
Mobi is a mobile wallet designed primarily to allwo travellers to use fiat currencies and Bitcoin in many countries around the world. With support for over 100 fiat currencies plus Bitcoin, Mobi offers security and convenience for users on both android and Apple platforms.
Copay is a mobile wallet for android and iOS devices that supports multiple Bitcoin addresses so the user can keep personal and business transactions separate. It also offers multisig and other features for extra security. Designed with business users in mind, Copay is open source and also available for Windows, Mac OS X and Linux.
Hardware wallets are physical devices that usually connect to a personal computer or mobile device via USB, and hold the public and private keys for a number of crypto currency accounts. Often referred to as 'cold storage' because they are not permanently connected to the internet, hardware crypto wallets offer an incredibly high level of security under nrmal conditions, however it is advisable to make a backup copy of the keys in a paper wallet held in a fireproof safe.
The Ledger Nano S is a high tech device that stores public and private crypto wallet keys securely in a conveniently designed USB compatible device with an OLED display and discreet buttons for navigation. It can be used for secure cold storage of crypto currency as well as for day to day transactions and currently supports no fewer than nine crypto currencies including Bitcoin, Ethereum, Dash, Litecoin and more.
The Trezor Hardware Wallet is a highly secure hardware wallet designed for cold storage of crypto currencies and for signing offline crypto transactions. With various built in security measures and compatibility with a range of android apps, the Trezor is a good option for crypto currency investors who need to store large amounts of Bitcoin and other crypto coins securely and offline. It currently supports eight crypto currencies.
A paper wallet is one of the most simple forms of crypto currency wallet that nevertheless affords a very high level of security for crypto investors. As the name suggests, a paper wallet is nothing more than a printed version of a crypto currency wallet. Various websites offer “key generation” services to create public and private keys for crypto wallets, and these can simply be printed out on paper or a more durable material, and then held in a fireproof safe or bank vault for long term, secure storage of Bitcoin and other crypto currencies. It is advisable to make several copies and hold in separate, secure storage locations so that there is no chance of your coins ever being lost. Inexpensive and innovative, paper wallets provide a good backup option for almost every other type of crypto currency wallet.
With the rapid rise of Bitcoin and other crypto currencies, the need has arisen for user friendly crypto currency wallets with good security, and support for an ever expanding range of crypto coins. From online wallets and exchanges, to mobile, desktop, hardware and paper wallets, the range of choice for new and experienced crypto investors is growing day by day. This article has discussed the benefits and risks associated with the various types of crypto wallets, and provided a selection of some of the best wallets available across multiple platforms. Readers are encouraged to do more research on the topic, try out some of the wallets for themselves, and enjoy the security and convenience they provide.