Last Update March 14th, 2020. A bitcoin wallet is a secure location where cryptocurrency is stored.
The best bitcoin wallets can store multiple cryptocurrencies and have strong security. For best practices, you will want to move your bitcoin off exchanges and into a secure wallet.
The two types of bitcoin wallets are hot and cold. Hot wallets are connected to the Internet, while cold wallets are offline.
A hot wallet is an easy to use wallet that is connected to the Internet. These types of wallets are found on smartphones and personal computers.
A cold storage hardware wallet is the most secure way to store your cryptoassets. This wallet is impenetrable to hacks and can be further stored away in a vault or safe location.
Table of Contents
- What Is A Bitcoin Wallet?
- Types Of Bitcoin Wallets
- The Best Hardware Wallets
- The Best Paper Wallets
- The Best Mobile Wallets And Apps
- The Best Desktop Wallets
- What Is The Best Overall Bitcoin Wallet?
- Cold Wallet vs Hot Wallet: A Side-By-Side Comparison
- Closing Thoughts
- What Is A Multi-Signature Wallet?
- How Do I Choose A Good Bitcoin Wallet?
- How Does A Bitcoin Wallet Work?
- Do I Need A Bitcoin Wallet?
- Will Cryptocurrency Wallets Rise In Popularity?
- What Are The Different Hardware Wallets?
- How Do I Get Started With The Coinbase Wallet?
- Is Wirex A Bitcoin Wallet?
- Can I Store My Bitcoin Inside Of A Tax-Advantaged Retirement Account?
An Official Guide To The Best Bitcoin Wallets
Over the past decade, bitcoin has managed to grow from an unknown virtual currency into the dominant digital currency of the world. With security being so critical, it is important for users to understand the options they have to choose from when looking for a good bitcoin wallet.
There are a variety of bitcoin wallets that you can choose from to meet your needs.
What Is A Bitcoin Wallet?
A bitcoin wallet is nothing more than a program for sending and receiving bitcoins. The blockchain is bitcoin’s ledger and a bitcoin wallet makes transactions simpler by serving as an interface.
These programs can be found on desktops, mobile devices, laptops and even as standalone hardware devices.
Many hardware wallets can be purchased on Amazon or directly from a manufacturer’s website, while mobile and desktop wallets can be downloaded directly to a smartphone device or computer.
Types Of Bitcoin Wallets
Several different types of wallets are available for you to store your coins.
Cold Storage Wallets
Cold storage wallets are considered to be the most secure wallets. They are not attached to the Internet so they can not get hacked from a remote location.
“Cold storage in the context of Bitcoin refers to storing Bitcoins offline and spending without the private keys controlling them ever being online. This resists theft by hackers and malware, and is often a necessary security precaution especially dealing with large amounts of Bitcoin.”Source: Bitcoin Wiki, Cold Storage
Examples of cold storage wallets:
The Best Hardware Wallets
Hardware wallets are by far the safest types of wallets. Hardware wallets are physical devices that are not connected to the Internet but can be connected to a computer to safely move cryptocurrency. Hardware wallets are built to eliminate every point of entry that hackers may use to steal your coins.
TREZOR Wallet: Launched in 2014 as one of the first-ever bitcoin wallets, Trezor has not only withstood the test of time, but it has also successfully undergone several upgrades.
Today, the key-like device provides a portable means for users to carry about various cryptocurrencies other than bitcoin. Users can operate the device through just two buttons as well as through a computer program and a browser extension.
If you are looking for the bitcoin wallet with the best security, look no further than Trezor. Even though it is not considered a complete platform for buying and selling like Coinbase, it is a perfect option for storing bitcoin. It offers features such as 2-Factor Authentication (2FA). Users will have some protection against lost devices and passwords when using this wallet. However, it is essential to take the necessary steps to ensure that no one ever has access to your bitcoin wallet.
Ledger Nano: Hardware wallets are the safest and most useful for storing bitcoin and other cryptocurrencies.
In this category, Ledger, a French brand, leads the competition. The Ledger hardware wallet comes with a highly intuitive interface and simplified operations. Ledger Nano is ideal for both seasoned holders and beginners of cryptocurrency.
The device features just two buttons that can be used to perform a host of functions, including entering keys, pin codes, recovery words, etc., confirming transactions, checking balances, and lots more. Users only need to activate the “Live Now” function to begin interacting with their cryptocurrencies.
What’s more, the device also comes with a customizable 8-digit pin lock.
|Trezor One||$55||Screen; PIN code; Password manager; Compact and lightweight; Comes with simple instructions and USB Cable; Works seamlessly with Windows, macOS, Linux|
|Trezor Model T||$169||Touch screen display; PIN code; Password manager; Comes with backup seed cards and USB cable; Works with USB-C and microSD card; Works seamlessly on Windows, macOS, and Linux|
|Ledger Nano S||$59||Screen; PIN code; Ledger Live companion app on iOS and Android; Isolated Secure Chip; Works with USB Type Micro-B; Compatible with Windows, macOS, Linux|
|Ledger Nano X||$119||Screen; PIN code; Ledger Live companion app on iOS and Android; Isolated Secure Chip; Bluetooth compatibility; Works with USB Type C; Compatible with Windows, macOS, Linux|
|KeepKey||$49||Screen; PIN code; Integrated with Shapeshift; Works on PC, Mac, Linux, and Android|
The Best Paper Wallets
Paper wallets are nothing more than pieces of paper that have a seed or private key written on it. When your private key is kept on a piece of paper, only a person who has access to the document can steal your private key.
Advantages of making and using a paper wallet include:
- Being malware and keylogger free
- Not having to rely on a third party to protect your coins
“A paper wallet is the name given to an obsolete and unsafe method of storing bitcoin which was popular between 2011 and 2016. It works by having a single private key and bitcoin address, usually generated by a website, being printed out onto paper. This method has a large number of downsides and should not be used.”Source: Bitcoin Wiki, Paper Wallet
Bitcoin Paper Wallet: You can make and print out a paper wallet yourself (and even order specialized hologram stickers or bootable Ubuntu CDs).
WalletGenerator: Make and print your own foldable paper wallet.
Bitaddress: A tool used to securely generate a bitcoin address for secure offline storage and is another way to create a paper wallet online.
Unfortunately, paper wallets can be destroyed very easily, so they need to be stored in a safe location. It is best to create several copies of the wallet so you can retrieve your private key even if one paper wallet is destroyed.
Also, keep in mind that if you have a paper wallet, you will still have to import the key so it can be used digitally.
|Bitcoin Paper Wallet||Make Paper Wallets to Keep Your Bitcoin Addresses Safe. Order holographic labels and bootable Ubuntu CDs.|
|Wallet Generator||Universal Open Source Client-Side Wallet Generator. Print your own foldable bitcoin wallet.|
Hot wallets are connected to the Internet. Usually, they are connected to an application or exchange so bitcoin can be moved at will.
“A hot wallet refers to a Bitcoin wallet that is online and connected in some way to the Internet. It is a term that refers to bitcoins that are not being kept in cold storage.”Source: Bitcoin Wiki, Hot Wallet
Examples of hot wallets:
- Mobile apps
The Best Mobile Wallets And Apps
Mobile wallets store private keys on a smartphone, and are most commonly found as iOS or Android apps. Mobile wallets are considered to be the most convenient type of wallet for the average user’s mobile lifestyle.
Many consider mobile wallets to be the least secure of all wallets, thus it is not wise to store a large amount of bitcoin in them. Because smartphones frequently break, are stolen, or get lost, it is best to enable 2-Factor Authentication (2FA) and back up your wallet and seed.
Coinbase: Coinbase is one of the most popular cryptocurrency exchanges in existence and doubles as both a secure bitcoin wallet and as a cryptocurrency exchange. The Coinbase platform is renowned for its security and highly intuitive user interface. The platform also offers offline storage dubbed the Coinbase Vault, which has multi-signature functionality. The vault is an excellent alternative for those who are wary of storing their coins on the exchange.
Paxful wallet: Paxful is the most popular person-to-person bitcoin marketplace around the globe. Your money can be kept on Paxful as a desktop and mobile wallet. With over 300+ payment methods supported, Paxful makes it easy to convert your bitcoin into other currencies from anywhere. The Paxful wallet is secured with 2FA and is constantly being updated with feature improvements and security enhancements.
Blockchain wallet: Originally founded as Blockchain.info, a basic bitcoin block explorer, Blockchain now aims to provide cryptocurrency holders with an excellent tool to store, manage and trade their coins. The platform also comes with a proprietary “Lockbox” feature that will enable users to sync their blockchain account with any hardware wallet of their choice. Blockchain sports a crisp, intuitive interface, and offers hands-on customer support, making it highly ideal for both newcomers and connoisseurs.
BRD Wallet: The BRD (Formerly Bread) wallet is one of the most popular mobile wallets and provides users with a simple and secure way to store and access their crypto assets within a clean and user-friendly interface. Users are able to login using a 12-word paper key and also buy bitcoin directly from the app. Should you have any questions the app has a knowledge base and support chat which can be easily accessed from within the app.
Mycelium: Mycelium is one of the first-ever cryptocurrency wallets created in 2008. Mycelium is both user-friendly and has features for advanced users. Besides those attributes, the app has also endeared users because of its top-notch privacy and security features, including the BitID protocol that authenticates users and transactions by generating new addresses for every transaction, as well as hardware wallet integration.
Lumi Wallet: The Lumi Wallet is a fast-growing crypto wallet, that has bet on anonymity and security. The wallet has client-side encryption, which means that all data stays on user phones. The only information that users need to access the wallet is their 12-word mnemonic phrase. It can be generated after installation or entered manually if the user has created it before. With the Lumi wallet, it is possible to buy crypto via credit card, exchange currencies and check price fluctuations.
|Coinbase||iOS, Android||Coinbase doubles as a secure wallet and as a cryptocurrency exchange and sports a user-friendly interface.|
|Paxful||iOS, Android||Paxful wallet is secured with 2FA and is used by merchants to buy and sell bitcoin on the go.|
|Blockchain||iOS, Android||Blockchain wallet provides cryptocurrency holders with an excellent tool to store, manage and trade their coins.|
|BRD||iOS, Android||BRD wallet provides users with a simple and secure way to access their crypto assets within a clean and user-friendly interface.|
|Mycelium||iOS, Android||Mycelium is both user-friendly and has top-notch security and privacy features for advanced users.|
|Lumi||iOS, Android||Lumi stands out by having a very clear design and adaptive interface, which suits both novice and advanced crypto users.|
The Best Desktop Wallets
Desktop wallets are computer programs that you can install to serve as a safe depository and hot wallet for your crypto assets on your computer. Your private key is safe as long as the computer is free of any security weaknesses and malware. These types of wallets are valuable targets for hackers.
Exodus: Exodus is one of the most popular and highly-rated multi-cryptocurrency wallets supporting over 100 cryptocurrencies. The Exodus user interface gives users a snapshot of the assets in their portfolio and the ability to exchange between cryptoassets seamlessly. On Exodus, cryptoassets can be managed securely from a Trezor hardware wallet. You can also control your digital assets on the move with the Exodus app on iOS and Android.
Atomic wallet: The Atomic wallet is a free, simple, yet highly secure wallet for managing hundreds of different cryptocurrencies. The Atomic wallet has no accounts, no verification, and no KYC for basic features in the wallet. Users have access to an extensive help center with a highly responsive support team. The Atomic wallet is suited for Debian, Ubuntu and Fedora Linux users and is also supported on Windows and MacOS.
Electrum: Electrum is a lightweight, free and decentralized secure wallet. Electrum has various user interfaces and can be used on mobile, desktop or with the command-line interface. Electrum has numerous backup recovery options for advanced users and supports third-party plugins such as multi-signature services and hardware wallets like Trezor, Ledger and KeepKey. Electrum also supports cold storage and allows you to keep a handwritten wallet or printed set of keys for your personal safekeeping.
|Exodus||Windows, MacOS, Linux, iOS, Android||Exodus gives users a way to Secure, Manage, and Exchange cryptocurrency in one beautiful application. Trezor wallet support.|
|Atomic||MacOS, Windows, Linux, iOS, Android||Atomic Wallet is a non-custodial decentralized wallet and gives users full control over their funds.|
|Electrum||MacOS, Android, Windows, Linux||Electrum is a lightweight, free and decentralized secure wallet with advanced features.|
What Is The Best Overall Bitcoin Wallet?
Our favorite hardware wallet manufacturer is TREZOR who makes products known for simplicity, portability, and ease of use.
At $55, the Trezor One is affordable, secure and supported universally on all operating systems and most browsers, which makes it a must-have wallet.
We recommend choosing a cold-storage hardware wallet to secure your bitcoins. A hot wallet may be useful if you plan to trade your bitcoin within a short period of time, however it is not as secure or dependable as a cold-storage hardware wallet for long term storage.
Cold Wallet vs Hot Wallet: A Side-By-Side Comparison
What Is A Cold Wallet?
A cold wallet is offline. A cold storage wallet can be compared to a vault secured savings account. Investors with large amounts of crypto assets normally keep the vast majority of their assets within a cold storage wallet. Hackers cannot steal digital assets that are kept inside of a cold wallet.
What Is A Hot Wallet?
A hot wallet is connected to the Internet. A hot wallet can be compared to a checking account, which is liquid in function. Hot wallets, although popular, are not secure because access to the wallet can be achieved through an Internet connection by a third party.
We highly recommend that you back up your bitcoin wallet. Always remember to write down your seed phrase and store your private keys somewhere safe, so you can access your wallet even if you lose the device it is stored on.
Frequently Asked Questions
What Is A Multi-Signature Wallet?
Multi-signature wallets are best for those who want or need to share their wallets with other people. Also known as multi-sig wallets, bitcoins can only be accessed if there are enough private keys connected together at one time.
“Multisignature (multisig) refers to requiring multiple keys to authorize a Bitcoin transaction, rather than a single signature from one key.”Source: Bitcoin Wiki, Multisignature
For example, if each person has a private key to one wallet, and one person wants to withdraw coins only using their private key, the wallet will not make the transaction without all private keys present. On the other hand, if three people have private keys, and two people want to pay an expense, all of the private keys do not need to be present.
How Do I Choose A Good Bitcoin Wallet?
People use bitcoin wallets for different purposes. Do you need a bitcoin wallet to store a large amount of bitcoin, or do you need a bitcoin wallet to keep some change so you can buy a latte?
Wallets have various security levels, and with some wallets, you may have more security features and less convenience. You will have to decide on the features that are more important to you. Some of the questions you may want to ask are:
- Do you want to pay for a wallet?
- How often will you use a wallet?
- Are you tech-savvy?
- Will you be storing coins other than bitcoin?
- Are you sharing the wallet with someone else?
- Do you value privacy or convenience?
- Do you want to carry the wallet with you?
Depending on your answers to the questions, you should have a list of wallets you are interested in using. You may even decide that you want more than one wallet. A hardware wallet can be used for large amounts of money, and a smaller, mobile wallet can be used to store spare change. This way, even if the mobile wallet is hacked or your phone breaks, you will not be out of a lot of money.
How Does A Bitcoin Wallet Work?
Bitcoin wallets work very similar to email. If you want to send someone an email, you will need to select a recipient and a message. Bitcoin, like email, requires that you use a specific address to send and receive money.
Wallet Address – The address you use is known as your bitcoin address. You can share this bitcoin address with anyone who is waiting to send you bitcoins. Bitcoin addresses always begin with the numbers ‘1’ or ‘3’.
Private Key – Your bitcoin private key is a randomly generated string (numbers and letters), allowing bitcoins to be spent. A private key is merely a long string of letters and numbers that act as your password. It is this secret combination of numbers and letters that will give the wallet the capability to let the bitcoin network know that you want to send your bitcoins to another location.
Public Key – A public key is a cryptographic code that allows a user to receive cryptocurrencies into his or her account.
Seed – If your wallet breaks or is stolen, you can download your wallet on another device as long as you have your seed phrase on hand.
The core function of the wallet is to create and store the private key. In other terms, the wallet automates bitcoin’s cryptography and blockchain communications for you.
Last but not least, a bitcoin wallet stores your user preferences. These preferences depend on which wallet type you’re using and on which platform.
Do I Need A Bitcoin Wallet?
Yes, it is recommended that you have a reliable wallet to store your bitcoin. There have been incidences of exchanges being hacked in the past, i.e. Mt. Gox and Bitfinex, so it is vital that you move your cryptocurrency off of exchanges and into a secure and authentic bitcoin wallet.
Will Cryptocurrency Wallets Rise In Popularity?
Cryptocurrency wallets provide users with convenient means to store their private and public keys, allowing them to carry out cryptocurrency exchanges and transactions easily. Wallets give users a vast array of choices that cater to numerous factors, including security, portability, and ease of access. You can read authentic reviews about Best Crypto Wallets on Revain.
What Are The Different Hardware Wallets?
There are many cryptocurrency hardware wallets brands out there today. The most famous being Trezor, Ledger, and KeepKey. Many more hardware wallets can be found on Amazon (at low prices).
How Do I Get Started With The Coinbase Wallet?
Setting up a wallet with Coinbase couldn’t be easier. Here’s how to go about it:
Step 1: Go to the Coinbase official website and click the “Get Started” button.
Step 2: Fill in your personal details as required. Enter a full name, email address, and password. Ensure that you use a strong password that includes both letters and digits for security purposes.
Step 3: Coinbase will send you an email containing a link for verification. Click on the link to verify your account. You will be asked to enter a phone number for 2FA verification, so make sure to use a working line.
Your Coinbase wallet is all set up and ready to use.
Is Wirex A Bitcoin Wallet?
Wirex is the first application that functions both as a mobile wallet (iOS and Android) and as an exchange. On the Wirex app and with the VISA debit card, users are able to buy, sell, exchange, store and spend multiple fiat currencies and cryptocurrencies online or in-store.