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If you’re investing in cryptocurrency, you’ll need a place to store your money and a way to send or receive cryptocurrencies.
A crypto wallet is the answer. Crypto wallets come in many forms, including web , mobile, desktop, paper, and hardware wallets. No matter the type of wallet you chose, they all serve the same function. However, depending on what you plan to use your cryptocurrency for, some wallets work better than others.
Best Crypto Wallets:
- Hardware: Ledger Nano S
- Hardware: Trezor One
- Hardware: KeepKey
- Hardware: Trezor Model T
- Software: Coinbase
- Software: Gemini
- Software: MetaMask
- Software: Argent
Hardware vs. Software Crypto Wallets
Both hardware and software wallets store the information that grants access to your crypto assets on the blockchain: your public and private keys.
Hardware wallets are physical items (often a type of USB drive). The Ledger Nano X, Trezor and KeepKey are popular names in hardware wallets.
Hardware wallets are considered the most secure type of wallet. It is the best choice if you invest large amounts at a time and don’t plan to trade regularly.
Software wallets are applications you download onto your computer or mobile device. Software wallets use encryption to protect your crypto assets. Software wallets are also known as hot wallets, while hardware wallets are called cold wallets.
Online platforms are another option, which don’t need to be downloaded and can be accessed through an internet browser.
Types of Crypto Wallets
- Hot wallets. These types of wallets use keys (a form of cryptography, kind of like a password) that were created or are stored on a device that has access to the internet. Hot wallets offer a high utility but are often considered less secure than cold wallets.
- Cold wallets. Cold wallets use keys created on a device that has never had access to the internet. Cold wallets are also known as hardware wallets, which are wallets stored on physical devices.
- Hosted wallets. These live on another server that you don’t control. Hosted wallets are attractive targets for hackers, as hosted wallets hold all the funds from the wallets on the server. Hosted wallets offer differing levels of protection, and some are even insured by third parties, so it’s important to be aware of what your hosted wallet has to offer.
- Decentralized wallets. A decentralized wallet means that only you hold the keys to your crypto wallet.. A decentralized wallet doesn’t guarantee complete anonymity, however. It simply means you don’t rely on a 3rd party to send, receive or store your cryptocurrency, mitigating some security risks associated with hosted wallets.
What to Look for in a Crypto Wallet
The biggest factor you should consider when choosing a crypto wallet is how you intend to use your crypto. If you are planning on buying and holding your investment for the long term, a hardware wallet is likely your best choice.
A solid strategy to manage risk is to limit the number of funds that can be accessed through less secure platforms, such as exchanges, while keeping the bulk of your funds in a more secure wallet somewhere offline. You might even choose to have several wallets to limit risk.
2-factor authentication. 2-factor authentication, also called 2FA, is another way to verify your identity when logging into your crypto wallet. If someone had your password or managed to crack your password through any of a number of methods, they would still need to pass the second level of authentication, typically a code sent to your phone which needs to be entered into a sign-in field before access to the wallet is granted.
Multi-signature support. In some cases, a crypto wallet is owned by several people, like business partners, for example. Multi-signature support means that you can set the security for the wallet to require multiple keys before access is granted. This prevents any one person from spending the funds in an unauthorized way or from transferring the funds to another wallet.
Exchanges as crypto wallets. A large number of cryptocurrency owners have used Coinbase or other exchanges as both an exchange and a crypto wallet. Coinbase is many people’s go-to, as it has a variety of tokens, allows payments, buying, selling and even trading through its GDAX platform.
Mobile wallets. While convenient, mobile crypto wallets create a unique set of potential security vulnerabilities. First, phones are often lost or broken. If the wallet key is only stored on the phone, a broken or lost phone could possibly make your wallet permanently inaccessible. However, some mobile wallets like Coinbase and Argent offer ways to restore your wallet if an accident happens.
Multi-currency vs. single currency. Many cryptocurrency owners own more than 1 kind of cryptocurrency. Maintaining a separate wallet for each type of currency can become confusing. Wallets are now available that support multiple types of currency.
Hardware Wallet Versus Exchange Storage
If you decide not to use a crypto wallet to hold your cryptocurrency, then you will have to trust your crypto brokerage to hold your private keys. Although holding your crypto on an exchange is not recommended, exchanges like Coinbase and Gemini are relatively safe from security breaches. However, big exchanges have been breached in the past, including Binance and Bitfinex.
Here are some of the pros and cons you should consider when deciding whether to use a hardware crypto wallet:
Pros of Using Hardware Wallets
- Impossible to be hacked when stored offline
- Total control over your crypto
- More anonymous than crypto exchanges
Cons of Using Hardware Wallets
- It takes time to get your cryptocurrency from your hardware wallet to an exchange, so you can’t trade it as easily.
- Hardware wallets cost money while most software wallets are free.
- Risk of losing the physical wallet
Best Hardware Cryptocurrency Wallets
Check out Benzinga’s top picks for hardware cryptocurrency wallets.
1. Ledger Nano S
The Ledger company has made big strides since its inception in 2014. It’s perfect for anyone serious about storing cryptocurrency. With an LED display for payment validation and a PIN to confirm, the handheld device is convenient and secure.
As another method of security, Ledger Nano S also features 2-factor authentication. The device has its own operating system, BOLOS, supporting Windows (7+), Mac (10.8+) and Linux. The hardware supports a multitude of the best cryptocurrencies and is easy to via USB compatibility.
The only drawback the device has is that your computer must be connected to the internet and running solely on Google Chrome for all applications to work. Ledger’s website boasts over 1,000,000 devices sold globally.
2. Trezor One
The Trezor One, by SatoshiLabs was designed and crafted in the Czech Republic by cryptocurrency advocates and a stellar cyber security team. In Czech, trezor literally translates to “vault.”
The Trezor team is credited with developing the first hardware wallet for cryptocurrencies using modern cryptography. It provides an LED display for an easy-to-use interface, as well as a PIN to access the wallet. Providing even more security, the devices prompts you to use 2-factor authentication when verifying your purchase.
The unique piece of hardware is compatible with Windows, Mac, and Linux and offers over 500 possible alt-coins to hold and trade. Much like every other hardware wallet, the device requires your computer to be connected to the internet and connected via USB.
Another competitor in the hardware wallet space is KeepKey. Created by a subsidiary of the Shaftshift exchange, KeepKey highlights the notable differences its device holds over its competitors. Launched in 2015, KeepKey noted that its security measures were far stronger than Trezor or Ledger.
We have yet to view anyone brave enough to confirm this notion; however, KeepKey does not have an operating system. Not having an operating system essentially makes a device malware proof.
It’s nearly impossible to infect a device with complicated instructions if that device does not have an operating system.
While security remains an advantage in using KeepKey, a major drawback is the availability of only 35 cryptocurrencies. Still, the device couldn’t be more easy to use by plugging it in one of the USB ports of your computer.
4. Trezor Model T
If you wanted to spend just a little more money to secure your digital assets, look to Trezor’s Model T. The innovative second edition hardware crypto wallet by Satoshi Labs was redesigned for better ease-of-use and security measures.
The largest difference from the original is in the easy-to-use touchscreen interface. The only downside to this is that it is the sole way to interact with the device. The Model T features the same availability of about 500 different coinswhile adding more layers of security. To even connect your device via USB, you must enter a PIN.
You only get one shot an inputting a PIN, as every time you input it incorrectly you are locked out for some time period to the power of 2. In addition to its mainstream security, the Model T comes with a 12-word seed recovery card that allows you to back up your coins in the event of you forgetting your password.
All in all, Satoshi Lab’s Model T seems to be the favorite, other than its higher price tag.
Best Software Cryptocurrency Wallets
A solid wallet is a must, but 1st you need to find a platform to trade or invest in cryptocurrency.
Coinbase wants anyone — anywhere — to be able to easily and securely access Bitcoin. Coinbase sees cryptocurrency as the future of money and as a catalyst for creating an open financial system around the world.
Today more than 35 million people in over 100 countries trust Coinbase to buy, sell, store, use and earn cryptocurrency. Moreover, Coinbase has its own software wallet, adding another level of security.
What many Coinbase users aren’t aware of, however, is that they have the option to use Coinbase Pro (formerly GDAX) for free. This is a great option for intermediate or advanced users, and I’ve outlined the pros and cons below.
Benefits of Coinbase Pro
- Trading fees are a fraction of what you’d pay on Coinbase
- More involved user interface and trading indicators
- Ability to set market and limit orders
Drawbacks of Coinbase Pro
- Some users may find the interface confusing
- There are other competitors with more competitive fees
Another important aspect to Coinbase Pro is its great security. Coinbase Pro keeps 98% of the funds deposited on the platform in cold storage, so it’s impossible for hackers to steal funds through an online attack.
Stay on top of market trends, build your crypto portfolio and execute your trading strategy with Gemini’s easy-to-use tools. The Gemini app is an industry leading crypto exchange for both mobile and PC users.
You can track asset prices and real-time market prices anytime, anywhere. The app makes it simple to set price alerts so you can act fast on price movements for individual assets. If you want to consistently increase your crypto holdings while averaging your buy in price, you can schedule recurring buys on bitcoin and other cryptocurrencies.
And Gemini boasts superior cybersecurity and custody solutions. Create a free account and make your 1st buy in as little as 3 minutes.
MetaMask is an ethereum wallet that works as a Google Chrome extension as well as a mobile app. It’s a great wallet for beginners, as it has a simple user interface and is intuitive to use.
However, MetaMask only supports Ethereum tokens, such as eth, EOS, Maker, DAI and many others. If you want to store bitcoin on MetaMask, you’d need to purchase WBTC (wrapped bitcoin) which is a synthetic bitcoin on ethereum’s network.
MetaMask also makes it exceptionally easy to connect with decentralized applications directly from your browser. Because of this, MetaMask is the go-to choice for investors looking to interact with several defi platforms.
Argent is a great choice for users who want a balance of utility and functionality. Argent is a mobile wallet that allows you to securely store, send and even earn interest on your crypto holdings.
Argent has a unique security feature in the case you forget your wallet seed. Usually, if you don’t remember your seed or password, you’ve lost access to your crypto wallet forever. With Argent, you can assign “guardians” who can approve a request to recover your wallet.
For example, if I forgot my seed and needed to recover my wallet, I could use an assigned guardian, such as my dad, to approve my request. You can even make another hardware wallet a guardian, and you can approve the request yourself by connecting your hardware wallet!
Argent, like MetaMask, is an ethereum wallet, so the tokens you can hold on it are limited. However, a key benefit to Argent is the interest you’re able to earn on the platform. Argent offers a savings account that yields an astounding 11% APY, magnitudes higher than any bank account. This is made possible through defi platforms such as Compound and Maker.
Get the Best Crypto Wallets for You
There is no one best cryptocurrency wallet. Rather, the best crypto wallet for you depends on what you intend to do with your crypto. If you want the most secure way to hold cryptocurrency, it’s undoubtedly with a hardware wallet.
If you’re looking for a secure way to interact with the growing decentralized finance industry, Argent may be the best choice to hold ethereum tokens. They offer industry leading security with a wallet that can actually earn you interest on your crypto.
For beginners who are looking for an easy and safe way to buy a large variety of coins, Gemini and Coinbase are the best options. If you’re looking for a more involved user experience and less expensive fees, you should consider Coinbase Pro.
Gemini builds crypto products to help you buy, sell, and store your bitcoin and cryptocurrency. You can buy bitcoin and crypto instantly and access all the tools you need to understand the crypto market and start investing, all through one clear, attractive interface. Gemini Crypto Platform offers excellent account management options. You can manage your account at a glance, view your account balance 24-hour changes and percent changes. Get started with Gemini now.