Following a precipitous fall in price at the end of 2018, Bitcoin prices seem to be stabilizing, leading new cryptocurrency investors to make Bitcoin a part of their portfolios. Choosing the best bitcoin wallet can be confusing if you’re new to cryptocurrencies.
Quick Look: Best Bitcoin Wallets
- Trezor One – Buy on Amazon
- CoolWallet S – Buy on Amazon
- Ledger Nano S – Buy on Amazon
- Trezor Model T – Buy on Amazon
What a Bitcoin Wallet Does
If you’re ready to start trading cryptocurrency or build your digital nest egg on the blockchain, the first thing you’ll need is a wallet to store your riches. Because Bitcoin is digital, you can’t hide it under your mattress and because it’s not an officially authorized currency, you can’t hold your Bitcoin in your local bank. A bitcoin wallet serves as a digital bank vault — as well as a ledger — a vault to which only you have the private key, and your Bitcoin wallet holds that key.
Much like the wallet you use to carry cash, a Bitcoin wallet is a way to secure your Bitcoin and manage access to your Bitcoin funds. If your private key becomes available to someone else or is compromised, your Bitcoin can be transferred out of your wallet, which is why Bitcoin wallet security is paramount.
The analogy of a wallet for storing your Bitcoin doesn’t fully describe the forms and functions of a Bitcoin wallet, however. A cryptocurrency wallet can be hardware that you keep in a safe place, it can be software installed on your computer or it can even be a website or an app on your phone that accesses a remote wallet.
An estimated 8% of the U.S. population has invested in cryptocurrency as an extended wave of early adopters. While most cryptocurrency investors don’t hold much Bitcoin as an investment yet, especially when compared to the value of homes, retirement funds and other common and traditional assets, it’s still important to secure your digital investment by choosing the best Bitcoin wallet for your needs.
A bitcoin wallet provides a safer way to store most or all of your Bitcoin, reducing the need to keep as much Bitcoin in a cryptocurrency exchange account if you plan to trade. Just transfer the amount you need from your wallet.
Key Features of the Best Bitcoin Wallets
Here, we focus primarily on hardware Bitcoin wallets and online Bitcoin wallets, effectively pitting security against convenience. A bank vault is more secure, a debit card is more convenient. This same concept applies to hardware wallets when compared to online wallets. While both types of wallets take strides to protect your digital assets, there are some pros and cons to each approach.
A hardware Bitcoin wallet, also called cold storage because it doesn’t have constant exposure to online threats, is typically a USB or Bluetooth device that acts as a lock for your bitcoin wallet that prevents Bitcoin from being transferred out of your wallet without first authorizing the transaction on the device. Some hardware Bitcoin wallets resemble a standard dongle that looks a bit like a USB WiFi dongle. Others are credit card shaped devices and can be carried with your credit or debit cards in your actual wallet, making these hardware Bitcoin wallets more convenient than many legacy designs.
Paper wallets are another type of cold storage because they have no online access. Your private key is either written down on paper or may be stored on a durable card that has a scannable QR code that holds your private key.
When purchasing a hardware Bitcoin wallet, experts recommend that you purchase from a trusted source or directly from the manufacturer, and avoid buying a used or refurbished wallet to minimize the chance that the wallet has been tampered with. Many Bitcoin enthusiasts purchase two or more hardware wallets at a time so they don’t lose access to their funds if one hardware wallet is misplaced or damaged.
An online wallet is also referred to as a hot wallet because it’s stored online and may be at more risk than with a hardware wallet. Cryptocurrency wallets installed on a computer are also considered hot wallets because the computer holds your private key as opposed to a separate removable device that can be stored safely. Mobile apps used to access a remote wallet are also hot wallets, although in this case, the risk to your Bitcoin may exist on a remote server that could be hacked or on your device itself.
Many hardware and software Bitcoin wallets support also support additional currencies, like Ethereum or Ripple, allowing you to choose the best cryptocurrency for a particular transaction or for trading. However, each type of cryptocurrency exists on its own. If you need to send Bitcoin to someone but you only have Ethereum, you’ll need to use a crypto exchange to change the currency to the desired type. Some wallets provide this functionality.
The Best Hardware Bitcoin Wallets
If your goal is to keep your Bitcoin as secure as possible, a hardware wallet is an effective solution. Today’s hardware Bitcoin wallets range from utilitarian designs to streamlined and stylish Bitcoin wallets as thin as a credit card — all with security at the forefront.
One of the most trusted names in cryptocurrency, Trezor combines ease of use with security in an affordable package with the time-tested Trezor One. A bright and easy-to-read OLED screen provides up to six lines of text, which aids in setup and displays transaction messages clearly while reducing the need for scrolling.
A 120 MHz ARM processor runs customized open-source software, keeping your private key safe from keyloggers and hackers. Connections are made by Micro USB and provide secure connectivity to both computers or supported mobile devices.
Trezor One automatically checks its firmware when connected to prevent unauthorized code from executing on the device. Expect support for Bitcoin as well as many other popular cryptocurrencies like Ethereum and Dash.
At the size of a credit card, the CoolWallet S combines convenience and durability with military-grade security at a price that won’t break the bank. Defying its slim design, the CoolWallet S boasts secure Bluetooth connectivity and a clear e-Paper display to make transaction confirmations a breeze.
Multiple coin types are supported, including Bitcoin, Ethereum, Ripple, Litecoin, Bitcoin Cash and EOS.
Expect the CoolWallet S to hold a charge for up to two weeks. Quick recharges are done through an innovative charging cradle.
Mobility is a focus and the CoolWallet S is designed to work with the CoolBitX Crypto mobile app available for Android or iOS. The slim device is also waterproof and bendable.
Ledger Nano S
Designed to be affordable and easy to use, the Ledger Nano S is the predecessor to the soon-to-be-released Ledger Nano X, which is only available for pre-order at the time of this writing and will support Bluetooth connectivity to Android and iOS devices.
A built-in LED screen on the Ledger Nano S makes transaction confirmations easy to read and the device folds into a sturdy metal shell to prevent damage while on the go.
A digital wealth of hundreds of cryptocurrencies are supported by the Ledger Nano S, including Bitcoin, Ethereum, Litecoin, Dash, and yes, Ripple as well, a unique find in a hardware wallet.
With one of the most trusted names in crypto wallets and an interface that’s easy to use through a secure Google Chrome web app, the Ledger Nano S is a proven favorite for cryptocurrency investors who favor affordable security.
Trezor Model T
Trezor’s Model T hardware Bitcoin Wallet works with Windows, OS X and Linux desktops through a USB connection. Android mobile devices are also supported through a vendor app in Google’s Play Store.
Over 1,000 coins are supported with the Trezor Model T, including Bitcoin, Ethereum, Litecoin, ZCash and Dash, with more regularly added. As with all but the Ledger hardware wallet, Ripple is not currently supported. Bitcoin investors are well-served by Trezor’s newest addition, with its convenient full-color touchscreen and proven support.
At boot up,
The Best Online Bitcoin Wallets
While hardware Bitcoin wallets provide a more secure way to handle Bitcoin transactions, online Bitcoin wallets remain popular and provide access from anywhere and remove the need to carry a separate device. Some Bitcoin enthusiasts use both types of wallets and keep a minimal amount of cryptocurrency in hot wallets, like online wallets, and keep the bulk of their treasure protected with a cold storage hardware wallet.
Millions place their trust in Blockchain.com. Two-factor authentication is supported through SMS code, Yubikey, or Google Authenticator, which provides an additional layer of protection against unauthorized access.
Blockchain boasts low fees and a built-in crypto exchange to help you switch your assets to another cryptocurrency on the go. Convenience is the name of the game with online Bitcoin wallets and Blockchain has you covered with easy and secure access through Android, iOS, or a through a trusted web browser, including Chrome, Firefox or Safari.
Available for both Android and iOS mobile devices, Mycelium provides an easy-to-navigate interface for mobile devices and allows you to send or receive funds by exchanging public key codes with QR codes. Trezor and KeepKey hardware wallets are also supported, allowing you to lock down your wallet further.
Mycelium provides remote hosting of the blockchain, which streamlines the wallet experience and leaves you in control of your private keys, which can be stored securely on your device.
We experienced some intermittently slow loading times using the web interface at wallet.mycelium.com. Fortunately, an Android app and iOS app provide alternatives for on-the-go connectivity.
If you’re new to the cryptocurrency world, it probably won’t be long before you start an account with Coinbase. As one of the largest and most-established cryptocurrency exchanges, Coinbase has become a staple for Bitcoin and other popular cryptocurrency markets.
Coinbase’s trusted wallet provides a secure way to keep your Bitcoin safe while also keeping your digital assets separate from your crypto trading accounts.
Bitcoin is supported by the Coinbase wallet, and other popular currencies are supported, too, including Litecoin, Ethereum and ER-20 tokens, which reduce the need for multiple cryptocurrency wallets. Security is enhanced by biometric authentication technology and works to secure your wallet if your device is mislaid or lost.
Imagine an online Bitcoin wallet that supports a dizzying array of cryptocurrencies and can run securely and smoothly even on legacy devices. That’s Coinomi, and users love its convenience and reliability.
Anonymized connection requests and strong encryption through Coinomi’s secure app enhance privacy and keep your Bitcoin safe. As with some of the better online wallet options, your private keys remain in your control and never leave your device.
Expect support for all popular cryptocurrencies, including Bitcoin, Ethereum, Bitcoin Cash and ZCash, as well as a massive list of altcoins and tokens. Built-in support for ShapeShift and Changelly make cryptocurrency exchanges a breeze using Coinami’s app.
Coinomi provides a wallet for Android, iOS, Windows, Mac OS and Linux.
Choose a Bitcoin Wallet That Fits You
Cryptocurrency and security are inseparable. However, the most secure options often mean sacrificing some convenience. As you build your cryptocurrency assets, consider your risk tolerance and exposure when choosing a cryptocurrency storage solution.
For many cryptocurrency investors and enthusiasts, the best solution is to maintain multiple wallets with a more secure hardware wallet solution for the bulk of your digital assets and a more convenient online wallet used for day-to-day transactions.
This structure isn’t unlike the way we manage the regular money we might have. Most of us only carry around a small amount of pocket money and keep the bulk of our cash out of harm’s way.