How to Select the Good Crypto/Bitcoin Wallet for Yourself
There's no denying that Bitcoins are a huge hit right now. Everyone and their dog is into cryptocurrency these days. After you initially buy your first bitcoin, you'll figure out that you have to store them somewhere safe and secure. Places designed to house your precious cryptocurrency are called bitcoin or crypto wallets. The problem is that there are literally hundreds, if not thousands of wallets out there and the average new bitcoin trader won't have any idea what to choose.
So with that in mind, we'll take a look at the various different options out there and hopefully find one that best suits your needs.
What kind of Bitcoin Wallets are there?
There's a variety of different bitcoin wallets out there but the most popular ones are Hot Wallets, Cold Wallets, Hardware Wallets, and Light Wallets. Let's take a look at them individually and examine their strengths and weaknesses.
- Hot Wallets
This variant is one of the most popular bitcoin wallet types out there. It allows users to manage their funds and do cryptocurrency trading.
- Cold Wallets
Cold wallets are similar to hot wallets in that they enable bitcoin traders to hold the cryptocurrency and perform transactions with a decreased risk of hacking.
- Hardware Wallets
Hardware wallets, on the other hand, are basically a specialized USB device that stores your funds and also lets you allocate those funds to different places.
- Light Wallets
Light wallets are essentially apps that give several benefits to the users like exchange options, trading desks and the purchase of bitcoins.
Think about your specific needs and select an appropriate type of wallet for them.
What makes a bitcoin wallet good?
This is the most obvious factor. After all, you're keeping real money in the wallet. If it were compromised you could lose all of it. It is paramount that you get the best security available. For web-based wallets, you have to be sure the site has a secure protocol. That means it has to be "HTPPS" and not "HTTP". That's not all. Make sure to check if the wallet offers safe and powerful logins. Two-Factor aLight Wallets
Authentication (2FA) is a must as well. I've talked about 2FA a number of times in other articles. Check them out if you want to know more.
Make sure you have a backup.
Another feature that we just couldn't ignore. If something happened to your wallet and, God forbid, all of your funds, then a good backup might save your skin.
This is kind of important for new users who are not yet familiar with the ins and outs of online wallets yet. Make your chosen wallet has a user-friendly interface.
Are you familiar with the multisig feature? It is an effective and widespread technique designed to protect your bitcoin wallet from online attacks. Multisig is a great tool because it needs more than one key to approve a transaction. Think of it as a lockbox where it takes two different people with unique keys to open that box.
When you're making the selection make sure to check if the bitcoin wallet you're interested in comes with multi-services support. That's not all. You should check its inclination to exchange bitcoins with your bank or other payment solutions like PayPal.
This is one of the most important factors when it comes time to pick out a wallet. Being able to have access to your wallet and its contents is essential. Having full access to your private keys means you will be able to manage or move your bitcoin transactions in any way you see fit.
Hierarchal Deterministic Wallets
As I said before, your wallet's privacy and security should be the main concerns. A Hierarchal Deterministic wallet will always make use of unique addresses, which will strengthen both its security and your privacy. Always check if the wallet you're considering is HD.
Another key feature. It's needless to say that if you lose access to your wallet for some reason you'll need help in regaining it. Good customer support is essential in such a case. Since we're dealing with real money you need to find a bitcoin wallet with 24/7 support.
According to your OS
Most quality bitcoin wallets work seamlessly with all big name operating systems like Windows, Mac, and Linux. Still, it's worth it to check if the wallet you've selected works well with your operating system before using it.
Same goes for your phone. All mobile devices have operating systems, typically iOS or Android, and it would be wise to check the wallet's compatibility with the OS since chances are you will attempt to access it through your phone at some point.
Check reviews before making a final choice
As with most products, it's always a good idea to check the internet for a general consensus. Check bitcoin wallet review sites for information on the wallet you're interested in. Even if you can't find any reviews you can always check online forums and ask for the opinions over other cryptocurrency traders.