Like every financial
asset, cryptocurrency also needs a safe place to be stored and accessed from
time to time. Today, billions of dollars worth of cryptocurrencies such as
Bitcoin and Ethereum are stored in digital storage called cryptocurrency
wallets. These wallets are being used for storing bitcoin or various other
cryptocurrencies. But, there is a lot more to these wallets than just the
storage of cryptocurrencies.
Let’s explore crypto
wallets and find the best crypto wallet that can help you manage your digital
wealth efficiently in 2022.
To begin with, let’s
find the answer to “what is a cryptocurrency wallet?”
By definition, a cryptocurrency wallet serves the function of our traditional
pocket-sized wallet, except for the fact that it is used for digital
transactions only. Before best cryptocurrency wallets came into being, people
were being familiarized with e-wallets or electronic wallets. These digital
wallets were used to store money in fiat currencies and make online and offline
transactions or transferring digital money (using QR codes also) to your
bank savings account. Same as using any online bank account, payment system
(credit/debit card or bank transfer), or brokerage.
With the introduction
of cryptocurrency, these e-wallets entered the next step of their evolution.
This led to the rise of wallets, investors and traders from several financial
marketplaces started trusting the adoption of Bitcoin and other digital assets
for the long term. Cryptocurrencies, once bought, are not immediately sold and
therefore need to be stored in a safe place.
The primary function
that wallet offer is the storage of cryptocurrencies. But, in addition to this,
cryptocurrencies can also be added or withdrawn from these wallets to make online
payments or exchange cryptocurrencies. Some kind of wallet makes crypto buy and
sell crypto, earn interest on crypto lending, trade on
bitcoin, etc.
Traders can then use
their login, and they are ready to buy and sell their chosen cryptocurrencies.
Users can buy/sell any crypto and pay with their bank account or debit card
using a simple payment verification method. Cryptocurrency exchanges convert fiat
currencies into digital currency, much like money in a bank account. As a
result, crypto, the oldest bitcoin wallet, has become the core component of the
cryptocurrency ecosystem.
Best Crypto Wallet Of 2022
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WALLET |
BEST FOR |
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Beginners |
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Bitcoin Traders |
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Mobile Wallet Users |
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BTC HODLers, Crypto Traders |
|
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Everyone: From the crypto-curious
to advanced users alike. |
|
|
Hardware Crypto Wallets Users |
|
|
Crypto Traders |
|
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Investors |
|
|
Amateur cryptocurrency Investors |
|
|
Multi-cryptocurrency Investors |
|
|
Beginners and dApp Users |
There are multiple
types of wallets based on their storage specifications and crypto
compatibility. However, each of these wallets is designed to run on blockchain
network technology and enable faster and secure crypto transactions. So let’s
get started explore each wallet in detail.
Hot cryptocurrency
wallets store crypto in online storage. These wallets do not store
cryptocurrency assets in offline (cold) storage. One of the biggest reasons why
people use hot storage crypto wallet is their accessibility. It is easy to
provide access crypto assets anywhere, anytime when they are stored online. In
hot crypto wallets, there are different kinds of online storage which store in
different ways.
Desktop Wallets
Desktop wallets are
hot wallets that store cryptocurrency assets on the desktop computer of the
user. With these wallets for buy and sell digital currency and trade crypto,
the computer needs to be actively connected to the internet via a USB cable.
When the desktop stays online and has crypto assets, the crypto wallets can
help manage these assets with their desktop app. These wallets are also called
desktop exchange wallets. Exodus is an excellent example of a desktop wallet
for Bitcoin. There are two codes are required for further process: a public key
and a private key.
A public key is a
large numerical value that is used to encrypt data. In such wallets, once you
install them on your desktop, you will get your crypto address and own private
key. Your cryptocurrency assets are safe if your private key is safe. If a
third party knows your private key you lost your crypto (try not forgot
password and/or seed phrase).
Similar to desktop
app, mobile platforms can also store Bitcoin and other cryptocurrencies via
e-wallet app and manage your crypto portfolio. Several leading wallets have
their mobile app (Android and IOS devices), which makes them mobile crypto
wallets. Users can also use apple pay to buy bitcoin. These hot crypto wallets
make crypto transactions more accessible and easy. Crypto users can exchange or
transfer their crypto money via mobile wallets app
and make transactions on the go.
Web Wallets
Web wallets have a
limited period yet needful usability. These hot digital wallets run in the form
of web apps on browser programs. They help in storing crypto money on the
internet in a secure web domain. Web wallets can be used on desktop as well as
mobile devices (except for Chrome extension). Furthermore, they can be
installed as plugins on web browser apps of smartphones and personal computers.
Cold crypto wallets
store cryptocurrencies in offline storage (ultra secure stored offline) only.
These storages are not connected to the internet. Therefore, they can be
accessed and controlled at a given period. These restrictions make cold crypto
wallet more safe place for storing digital money. Unlike hot storage crypto
wallets, this wallets have a low vulnerability to online threats and cyber
thefts of cryptocurrencies (other digital currencies).
Hosted Wallets
Non-custodial wallets
are called hosted wallets or self-hosted wallets. The wallet’s private key used
for storing crypto money in these wallets are unlike the traditional methods.
In hosted crypto wallet, the user retains the sole custody of the private key.
Here, in this wallet third party keeps your crypto for you. As a result, the
non-custodial wallets can solely be controlled by the user as hosted wallets.
Decentralized crypto
wallet are the newest addition to the type of crypto wallets. These wallets
enable the user to hold private keys (some kind of data that used to authorize
outgoing transactions) and control access to their digital money. But you lose
access to your digital money, if you lose your private keys or seed phrase. Due
to the decentralized nature of these wallets, the user has complete control
over buy and sell cryptocurrency from anywhere on the planet. For most people,
decentralized bitcoin wallets are considered anonymous.
What To Look For in
Crypto Wallets?
Before selecting the
right wallet for managing your digital wealth, it is essential to consider two
critical factors. Security and wallet utility are the deciding factors for
choosing the best bitcoin wallets for your business or use case. But, what sort
of security features or wallet utilities should we look for?
Let’s understand these
two key features in-depth and find out how they help us finalize the best
cryptocurrency wallets for 2022.
The major game-changer
for most crypto wallets has been the greater security features. Every year,
wallet upgrade their security measures to curb all kinds of online and offline
thefts. Best bitcoin wallets with offline storage, cold storages are more
secure than hot storage crypto wallet. Moreover, best bitcoin wallet developed
with robust blockchain mechanisms can store in a safe place and transfer crypto
funds securely. Therefore, cold wallets (like paper wallet) are more secure
than hot storage wallets, which is a significant consideration when selecting
the most secure wallet.
Wallet Utility
When it comes to
utility, hot wallets are more practical and user-friendly than cold wallets. A
hot software wallet can get more things done than a hard hardware wallets. Due
to online accessibility, hot wallets are far more helpful than cold wallets.
Similarly, using physical wallet can be improved to make it as applicable as
software wallets. These wallets usually come in the form of a USB stick.
Hardware crypto wallet basically does not allow users to buy/sell crypto using
traditional currency (like US dollars or Euros). And in this wallet thumb drive
use for stores the private keys to your crypto offline. A thumb drive, also
called a USB drive or flash drive.
With the help of these
two factors, it is easy to select the best crypto wallets for managing your
digital funds.
Now, let’s get started
to the crux of this quest. We are here to find the excellent wallets for 2022
or we can also say digital wallet service
provider. And, here are the top cryptocurrency wallets that have gained
popularity for their security and utility in recent years.
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