A cryptocurrency wallet is a piece of software where you store your cryptocurrency. Technically, you don't store your coins in the wallet itself. You do, however, attach the proof of ownership of your coins to your wallet.
This proof of ownership is called a private key and it allows you to access the associated cryptocurrency. A wallet is a nice case around this proof of ownership, so you don't have to be able to code to access your coins.
Every cryptocurrency wallet is connected to a blockchain, so in this article, we'd rather use the word wallet instead of blockchain.
Lots of variation
Crypto wallets are always digital but there are different types of wallets. For example, a wallet can be an app on your phone or certain wallets that are only accessible from your browser or you download a wallet on your computer. But there are also physical wallets, like paper and hardware wallets.
Hundreds of different manufacturers and software companies are working on all different types of wallets. Feeling overwhelmed? That's what this article is for. In this article we help you choose. Almost all the wallets we recommend are free.
How does a wallet work?
- Carry your wallet with you
- Less safe than a hardware wallet
- Managing your coins using your PC or laptop
- Less safe than a hardware wallet
- Safest storage method
You can categorize all wallets into one of the above three categories.
The name might suggest it already. These are wallets for your mobile phone. The advantage of these is that you always have them with you. Mobile wallets are often used as a hot wallet. This means that you can see this as a kind of ongoing account, with which you can buy coffee or more. All the mobile wallets we recommend are free and available for iPhone and Android. The wallets have been tested extensively.
Some mobile wallets also have a desktop or hardware version. The mobile ones are just easier to access. Manufacturer Ledger initially makes hardware wallets, but has now also created an app for iOS and Android.
A software wallet is an application for your desktop or laptop. This makes it seem as if your crypto coins are stored on your computer. But that's not quite the case. In fact, your cryptocurrency is always stored on the blockchain.
You can think of your wallet as a keychain with keys that allow you to access your crypto coins. A wallet generates a seed phrase. This is a sentence of 24 random words with which you can prove to the network that you are the owner of your crypto. With these 24 words you can access your crypto from any wallet. With a software wallet, these 24 words are stored on your computer.
Are you looking for the ultimate security for your coins? Then a hardware wallet is the wallet for you! A wallet works like a bank account for receiving, sending and managing your cryptocurrencies. A hardware wallet is a wallet in physical form. They come in all shapes and sizes. For example, the Ledger Nano S looks like a USB drive. Or Trezor. You can buy coins directly at BTC Direct from this wallet.
A hardware wallet is one of the safest ways to manage your cryptocurrencies. It's safe because your private keys are stored offline. No hacker can ever access your coins trough the internet. This makes it more secure than any other type of wallet.
Hardware wallets are also secured with a PIN. Is your hardware wallet stolen, or have you lost it? Then no one can access your cryptocurrency without that person knowing your PIN.