If you’re interested in venturing into trading or investing in cryptocurrencies, you’ll need a digital wallet. A digital wallet is a type of wallet that supports the storage and trade of cryptocurrency (especially the one you want to buy or trade). The wallet also stores all that digital currency for you, just like a bank account.
In this article, we will be breaking down the basics of crypto wallets, how to choose a crypto wallet for your crypto trading needs. We will also highlight the best crypto wallets, such as hi, and explain why they are the best – make sure you stick around till the end.
Crypto Wallet Explained: What is a Crypto Wallet?
A digital wallet that stores cryptocurrency is called a crypto digital wallet. This type of wallet is designed to store and protect the private keys used to access and spend cryptocurrencies. A crypto digital wallet can be used to store any cryptocurrency, including Bitcoin, Ethereum, and Litecoin. In addition, it allows you to access your funds from any device with an internet connection. This property makes it easy for you to manage your finances on the go. They exist in many different forms, but all of them provide a secure way to store your funds.
How Does a Digital Wallet for Crypto Work?
A crypto digital wallet has private keys that allow you to sign transactions on the blockchain. These private keys are vital since they help secure your crypto coins safely against hacking or theft. They also allow you to check their balance execute transactions and other services in your wallet. Additionally, the private keys provide an extra layer of security to your digital wallet.
Your digital wallet also comes with public keys, which is the wallet address you share with others so they can transfer crypto to your wallet. Unlike banks, there is no limit on how much cryptocurrency you can store in a digital wallet. If the value of a certain cryptocurrency unexpectedly rises, this might result in some significant gains.
How to Choose a Digital Wallet for Crypto?
It is critical to select a digital wallet that meets your specific crypto needs and requirements.
The first thing to consider is security. You should make sure the crypto wallet has robust security features to safeguard your assets. How safe is the wallet provider? Is your money protected if something goes wrong? The best wallets oﬀer 2-factor authentication, multi-signature support, in-built exchange features, and more.
Supported digital assets
Not every digital wallet will support the crypto assets you’re looking for. The crypto wallet you pick should support the currencies you wish to trade, be it Bitcoin or other altcoins. If it can accommodate newly launched tokens, the better.
Some wallets can be used without technical knowledge, while some are useful for seasoned traders. Hence you should also think about how easy it is to set up the wallet, manage various assets or navigate new solutions and offerings. It all comes down to convenience and the ease of accessing different products like staking, yield farming, and other earning opportunities.
If you trade cryptocurrency regularly, it would be best to choose a hot wallet (online storage) since it makes sending, receiving, and using your crypto easier. However, you also use a cold wallet (oﬄine storage) to keep the bulk of your crypto assets safe.
If you plan to use the wallet for crypto trading, make sure you understand what fees apply. Most hot wallets are free (though the trading fees can be very high) and oﬀer faster transactions. If you plan to hold large amounts of crypto, purchasing a hardware wallet (cold storage) is more sensible.
While almost all crypto wallets oﬀer trading capabilities, it is important to look for additional features like crypto staking, lending, and savings. These features can help you earn passive income by simply holding your crypto assets in that wallet.
Like other devices or computer programs, the best crypto wallet should come with good customer support. With reliable support, it implies that you can solve any issue that might arise when installing or using the crypto wallet. Good support should be available in different channels, including live chats, a knowledge base, and a phone line. Email support would also come in handy, especially when making lengthy and extensive inquiries.
Best Crypto Wallets
1. hi – Best for Earning Interest
hi is the one of the best crypto wallets that earn interest. It allows you to send, receive and earn cryptocurrency with ease. Even with little to no crypto knowledge, you can use hi to send and receive crypto and fiat from anywhere in the world. Also, you can use hi to convert freely between fiat and fiat, crypto and crypto, or fiat and crypto at mid-market rates. The mid-market rate is the average between the buy and sell prices of two currencies at any time and is thus the fairest rate you can get.
You can also use hi.com to earn passive income through any of the following methods:
2. Coinbase Wallet – Best for Beginners
Coinbase Wallet is probably the most popular Bitcoin wallet in the market. It boasts excellent security features such as multi-sig vault storage, which requires multiple people to enter their keys to access funds. The wallet’s highly intuitive and easy-to-navigate interface makes it the best option for beginners with little to no experience in crypto.
Given that the wallet is non-custodial, users are fully controlling their crypto assets. In addition, it supports more than 500 cryptocurrencies, including digital assets such as NFTs (non-fungible tokens). The wallet also oﬀers access to Coinbase exchange, allowing you to convert your cryptos at market prices.
3. Mycelium – Best for Mobile
Mycelium is one of the safest and most convenient wallets for mobile. This wallet is available on iOS and Android, making it easy to manage your cryptos anywhere. Like Coinbase Wallet, Mycelium has an in-app crypto exchange for your convenience. However, it only supports Bitcoin, Ethereum, and ERC-20 tokens, so your choice of coins is limited.
It has excellent security features, including several levels of PIN protection for that extra layer of security. Moreover, Mycelium allows users to set transaction fees based on their preferences – there are diﬀerent fees for priority, normal, economic, and priority transactions. Lastly, the wallet has an in-built feature called “cold storage” that allows users to store large amounts of coins on external drives for security purposes.
4. Exodus – Best for Desktop
Exodus is a multi-currency desktop wallet that stores the private keys to your cryptocurrency ina secure oﬄine environment on your computer. This means you’re in complete control of your funds at all times. It is easy to use, visually appealing, and oﬀers varied functionality to users. In addition, Exodus encrypts your private keys and transaction data locally for your eyes only.
Although Exodus now has apps for iOS and Android, the desktop wallet is still the best product the company has ever created. The wallet supports more than 145 currencies, including ETH, BTC, LTC, DogeCoin, etc. Additionally, Exodus wallet is integrated with Trezor wallets, making it easier to store some of your crypto holdings oﬄine.
5. Electrum – Best for Bitcoin
Electrum oﬀers the most extensive security features for a Bitcoin wallet. As one of the few remaining crypto wallets that only supports Bitcoin, Electrum boasts huge popularity. It is popular because it has a central server that operates as a Blockchain explorer and Bitcoin node (lightweight client). This means it can generate addresses inside the wallet while keeping your private keys oﬄine. This makes it difficult for hackers to attack your system and steal your funds. This system also speeds up transactions without compromising security. Of course, it goes without saying that the wallet takes up less space on your device.
Another highlight is that it lets you adjust transaction fees depending on how long you wait for the transaction to complete. If you want your transactions to go faster, you must pay more fees. Like Exodus, Electrum is compatible with hardware wallets like Trezor, Ledger, and KeepKey for cold storage.
6. Ledger Nano X – Best Hardware Wallet
Ledger Nano X is one of the most secure crypto wallets in the market – not only supports many cryptocurrencies but also oﬀers the best security features for cold storage. More specifically, it utilizes a specialized chip – the same one also used for credit cards and passports — to protect your wallet against attacks.
The Ledger Nano X also comes with a built-in battery and Bluetooth Low Energy connectivity for an enhanced digital asset management experience. You can also connect your wallet to the Ledger Live app on Android or iOS if you wish to convert, lend or sell your cryptocurrency. Currently, Ledger Nano X supports more than 1,800 currencies – and you can manage 100 simultaneously via the app.
The only downside of Ledger Nano X is that it is much more expensive than other crypto wallets – it currently retails at €149.
7. Robinhood – Best for Trading
Robinhood is a mobile stock trading app that lets users buy and sell stocks free, with no minimum balance or monthly service fees.
Robinhood oﬀers trading cryptocurrencies (Bitcoin, Ethereum, Bitcoin Cash, Litecoin, and Dogecoin). Robinhood Crypto currently supports market orders and limit orders, which allow you to automatically buy or sell a crypto asset at a specified price.
Robinhood also supports cryptocurrency transfers between accounts. For example, suppose you wish to move Bitcoin from your Robinhood Crypto wallet to the Bitcoin wallet of another exchange. So, you can transfer your Bitcoin directly into the other wallet using your external address.
8. MetaMask – Best for DeFi
MetaMask is the most popular cryptocurrency wallet for DeFi used by Ethereum traders and investors. It connects you to decentralized applications (Dapps) on the Ethereum blockchain.
MetaMask is also a browser extension that will enable you to run Ethereum dApps directly in your browser without functioning on a full Ethereum node. MetaMask includes a secure identity vault with a helpful interface for managing your identities across multiple sites and signing blockchain transactions.
Users can also use the MetaMask browser plug-in to run a digital wallet on any website they visit. MetaMask can also use it as a Chrome or Firefox extension or install it as an application on your computer or phone.
What Can a Crypto Wallet Be Used For?
1. Earn staking rewards
Staking involves committing your crypto assets to support a blockchain network by confirming transactions. You are rewarded with new coins in return. So only need to lock up a certain amount of their coins in your digital wallet to earn rewards. The more crypto you pledge (stake), the more coins you earn. This is how staking can become rather profitable. Usually, this is happening as a part of staking pools, but some digital wallets can easily add your coins for staking. These wallets include Ledger, Exodus, Atomic Wallet, and Trust Wallet.
Alternatively, you can stake your crypto on various exchanges and earn rewards. Numerous exchanges support staking, including Binance, Coinbase, Kraken, OKEx and hi. Some Exchanges of them are even offering zero-fee staking for specific coins.
2. Earn cashback
With a digital wallet, you may be able to stack rewards earned from purchases, promotions, or the platform itself. You can always earn cashback from a traditional rewards credit card, then use your rewards to buy more crypto yourself. hi’s crypto debit card, for instance, lets you earn 1 to 10% back in crypto rewards. So, you get rewarded on everyday purchases with crypto, which could potentially increase in value over time.
3. Send and receive crypto
Your digital wallet makes it easier to send and receive cryptocurrency to and from other people’s accounts, crypto exchanges, or digital marketplace. Coinbase Wallet, for instance, instance, lets you add funds by loading fiat into the app from a debit card or other source to buy cryptocurrency.
Coinbase, hi, Trust Wallet, Atomic, and Exodus are fantastic places to start if you only want a location to store or send and receive cryptocurrency. These digital wallets provide you with complete control over your currencies without relying on a third party.
4. Manage your trades
Some digital wallets, like Trust Wallet, facilitate managing your crypto holdings. The mobile app is equipped with everything you need to trade currencies, insights on trading patterns, access to a total balance across all linked accounts, and view the balance available.
Exchanges also offer digital wallets that support cryptocurrency trading, staking, making payments with cryptocurrency, and swapping. As a result, you can choose to buy, sell, and trade an extensive list of currencies and enjoy relatively low trading fees. In addition, you can quickly view your portfolio and a list of popular assets.
5. Store NFTs
Wallets can also be used to house digital valuables like NFTs that you may want to buy, sell, trade, or move to another wallet. MetaMask, for example, is an excellent NFT wallet. It may be adjusted to handle NFTs from other blockchains, such as Binance Smart Chain and Solana and ETH-based NFTs. MetaMask also makes it simple to create different addresses, allowing you to keep your NFTs separate from your BTC, or create a single address for each NFT you buy. In addition, it is equipped with a feature that allows you to switch currencies in order to purchase an NFT.
Other digital wallets that offer storage for non-fungible tokens include Math Wallet, AlphaWallet, Trust Wallet, and Coinbase Wallet.
Digital wallets for cryptocurrency are more popular than ever before, mainly because of the boom in cryptocurrencies like Bitcoin and Ethereum. With over 1,300 cryptocurrencies currently on the market, there are plenty of options when it comes to choosing a wallet that works for you.
As mentioned above, you need a digital wallet to store your crypto assets securely and prevent your funds from getting stolen or hacked.
A digital wallet – also known as a bitcoin wallet – holds proof of your digital assets. It keeps the public and private keys required to buy bitcoin or other cryptocurrencies. The private keys are fundamental because it provides digital signatures authorizing each transaction. In addition, it unlocks your crypto wallet to trade or spend your cryptocurrency. Sometimes, you will have to keep safe and secure your private key. Losing your private keys denies you access to your crypto.
Crypto digital wallets use advanced encryption to ensure that your funds are secure. And because digital wallets sit within your passcode-protected device, with payments often only possible via a PIN or two-factor authentication, they’re quite secure. However, hot digital wallets are vulnerable to hacking since they keep your private keys online. As such, only physical hardware wallet can oﬀer the best protection for your digital assets.
To buy or trade bitcoin, you need to create a wallet address to enable the proper storage of the digital currencies after it has been transferred to you. Most crypto exchanges provide a digital wallet for you to use. You can use the wallet to buy, sell, trade, or transfer crypto to someone else or even to another wallet. In addition, most bitcoin digital wallets are password-protected and offer security features such as encryption and two-factor authentication to secure your funds. If you’re considering using an exchange’s built-in wallet, getting familiar with its storage and crypto transfer capabilities is advisable.
If you plan to buy or sell cryptocurrencies, you don’t need to keep your crypto in a cold wallet or get a hot wallet. Many crypto exchanges allow you to save your coins in an exchange wallet. However, considering the security dangers associated with exchanges, relying only on this solution is not recommended. Make it a habit to move your crypto into your personal wallet after each trade.