Whether you are investing in cryptocurrency or you want to use it for regular transactions, you would need a crypto wallet.
Crypto wallets are just like traditional wallets. They are not stored in a particular location. These wallets are like software that store private and public keys – quite similar to bank accounts. They allow you to keep track of the balance and carry out transactions in a single place. Although they aren’t mainstream, over the years, when you would be using cryptocurrency to pay your Spectrum bill, buy groceries and do some retail shopping, everyone will be owning a crypto wallet.
Before entering into the debate of choosing a crypto wallet, let’s check out the types of wallets that exit.
Types of Crypto Wallets
These digital wallets can be broken into 3 categories: hardware, software, and paper. Here’s a brief overview of the common types:
These wallets are downloadable. The only way to access them is from the PC they are downloaded or installed on. They are highly secured but if your PC is hacked or gets infected by a virus, you might lose all funds.
They run on the cloud and you can access them from any device and location. Also, they are controlled by a third party and you store the private keys online. They are not the safest when it comes to security.
You can run this type of wallet on your phone. You can also use them to make purchases anywhere. They are simpler to use and they don’t take much storage space either.
Here, a hardware device is involved like a USB where you store your private key. The transactions are made online but they are stored offline. These wallets are compatible with most web interfaces.
Yes, paper wallets exist too. They offer the highest level of security. They are simply a printout of your public/private keys. It is very straightforward to use them. You transfer funds from the software wallet to a public address displayed on your paper wallet. To withdraw the currency, you just have to transfer funds from a paper wallet to a software wallet.
How to Choose a Crypto Wallet?
For new investors, choosing the right crypto wallet can be challenging. Which one to choose basically depends on your needs. Some wallets are best suited for small and regular transactions while others are best for long-term investment.
Follow these tips to choose the right one:
Single or Multi-Currency Wallet
There is a whole pool of cryptocurrencies in the ecosystem and infrastructure. If you want to invest in different currencies, there is no need to create separate wallets. You can use multi-currency wallets like Islamic wallet to hold different assets and even exchange them.
The transaction fee for crypto is very small as compared to traditional bank fees. You will have to pay different types of fees from processing fee to network miner’s fee. Sometimes, there is no fee at all.
Different wallets allow you to set the transaction fee. If you want the few to be low, your transactions will receive low priority.
No matter what crypto wallet you are using, one thing that you would want is to keep your funds secure. Check the security offered by the wallet. The blockchain system makes cryptocurrency highly secure. Hardware wallets are the ones that offer the highest security. They keep your information enclosed.
You would certainly want a wallet that is mobile and you can access it anywhere from around the world. Online and web wallets are the ones when it comes to mobility. Some wallets even have a mobile app to make transactions easier than ever. If you are using wallets for regular transactions, go for web wallets.
A crypto wallet has to be user-friendly. Some wallets are boring and hard to navigate. Lots of people quit using them because it’s hard to find options. Before settling for a wallet, choose the one that is user-friendly the most. Stay away from the wallets that frustrate you. Mobile and desktop wallets are the most user-friendly. It’s easy to get started with them.
Which Wallet is The Best?
There is no right answer to that because it depends on how you intend to use the wallet. You may get anxious and excited like you do when you have to choose a cable plan like Spectrum TV Select (because you get such a huge channel lineup). But there is a good way to settle this. Here are some questions that will help you settle for the right one:
- Do you want to use it for everyday purchases or you simply want to use the currency for investment?
- Want to stick to one currency only or multiple currencies?
- Prefer using the wallet from a single location or anywhere?
Apart from getting answers to these questions, take your time to assess your own needs and choose the one that best suits your needs. Make sure it offers the highest level of security, especially if you are considering digital currency as an investment.