It’s time to get cracking on encrypting your crypto. With Bitcoin, Ethereum and virtually every kind of virtual currency hitting the forefront of more and more people’s minds, learning how to secure your coins is going to be at least as valuable as learning how to earn them. While there are several options that can be undertaken to safely store your purchased coins, tokens, cryptos or whatever you want to call them, we’re going to help you traverse the world of virtual banking security.
Bitcoin wallets are essential to everyone: amateurs and veteran traders. Regardless of what kind of experience, you ought to find the safest place for storing your Bitcoin. This is why it’s important for all crypto traders to learn about the best practices and services. It’s even more important than learning about the science and mathematics behind the blockchain itself.
Think of it this way. When it comes to protecting and having access to your money, would you rather know the convoluted intricacies of how a real life bank operates, with all its personnel and regulations? Or the passcode to your credit card?
There are multiple kinds of Bitcoin wallets, and we’ll be looking at the most reliable and trustworthy services in each category. You’ll generally be looking at using either an online wallet, a downloaded desktop wallet, or a portable wallet via a phone app. In addition to those three is what’s known as hardware wallets, which are both offline and generally portable.
Hot vs Cold Wallets
Another way to think about the categorization of different wallets is with the terms “hot” and “cold”. These terms refer to differences in internet access as well as sending versus receiving priorities.
A hot Bitcoin wallet is generally connected to the internet all the time, or at least most of the time. It’s used for receiving funds as well as sending. As a result, these kinds of wallets are used for frequent transactions rather than cold storage. Due to their nature of being connected to internet access points and the blockchain, it is usually recommended that small funds be connected to these kinds of wallets in order to maximize your own personal security efforts. Examples of hot wallets include online wallets or other proprietary wallets offered by dedicated exchange service platforms.
Now on the other hand, a cold Bitcoin wallet is primarily used for storage. They’re normally used for receiving funds but not sending out any, and are often disconnected from the internet for security purposes in order to act as storage. A cold wallet has more in common with a vault than it does with a regular wallet or online finance account; it does a lot more protecting and receiving than it does sending. The name “cold” refers to this cold storage function, as well as the fact that remaining disconnected from the internet makes it much less susceptible to hacking.
We also want to point out another commonly asked question that you may be wondering: Can Bitcoin wallets only store Bitcoin itself, and no other kind of cryptocurrency? The answer is yes. If you want to trade and store Ethereum, you will need a dedicated Ethereum wallet, and so on for other currencies. While there are some experimental wallets that deal with storing multiple currencies, the vast majority only interact with one kind.
With all disclaimers out of the way, let us begin with the list.
Best Online Wallets (Web Wallets)
Online wallets do exactly what you’d expect them to do. Usually the exchange service website you use to purchase and sell your coins also doubles as a place for storing them for you via their online security system. This is convenient for many, although crypto enthusiasts would generally recommend using a different and separate procedure. No software needs to be downloaded onto your computer for online wallets to function, which arguably makes them the most convenient of choices available.
It is true that online wallets are the least secure, but we don’t think they’re too unsafe. Some sites can be trusted, and in the end the difference between using an online wallet and an offline one is like the difference between a short, simple password and a long one with many different kinds of symbols. The complicated security feature will always be safer, but is it really necessary for everyone? It’s going from 90% security to 99.9%, and that extra 9.9% comes with a lot more work than you might think.
Using the safest methods is recommended if you are dealing in higher volumes over longer periods of time. Always remember that there is nothing stopping you from using multiple services or wallets if you don’t feel completely safe with what you’re already using. But if you simply want to make a few hundred bucks over a few months or simply find the hassle of offline wallets too alarmist and paranoid, then here’s what you should be using:
Coinbase is one of the most popular exchange services for cryptos these days. The premise of the site is simple and rudimentary, but that’s what gives it its convenience factor. Used by many amateur and starting traders, Coinbase only features Bitcoin, Bitcoin Cash, Ethereum and Litecoin. The interface is very simple and can be mastered in a matter of minutes, making Coinbase especially user-friendly to beginners.
Your wallet (or wallets, should you choose to invest in multiple coins) is directly accessible from a tab that displays both how much you own and how much it is worth in the fiat currency of your choice. You can easily see how much money you have earned – or lost – in real time as the price of Bitcoin fluctuates.
Coinbase’s security should also be very satisfactory for anyone looking for provisional storage. 2-factor authentication can be activated on your account at anytime from the settings menu. Due to Coinbase’s popularity and success, it has devoted much of its funds to increase its security measures in general. Anyone dealing in low volume Bitcoin will feel secure enough in letting their Coinbase handle their wallets as online storage.
Much like Coinbase, Blockchain is one of the most popular and widely used online wallets to date with over 8 million users. Unlike Coinbase, this site only has support for Bitcoin, but has extra features that make up for it.
While Blockchain began as an online only service, it has recently launched its desktop and portable app capabilities. This cross-platform functionality has allowed Blockchain to feature the extra security measures that many feel are lacking in most online wallets.
If you happen to be someone who starts off as an amateur crypto trader who eventually amasses a large amount of Bitcoin while using Blockchain, then you have extra options available to you. Someone who has amassed a large volume of cryptos using Coinbase for example would have to rely on a secondary service entirely if they wanted to switch to a desktop or hardware wallet. Blockchain gives you that option from the get-go by downloading their desktop or portable app versions, which are the other types of wallets which we will go into more detail later in this article.
And much like Coinbase, Blockchain is extremely beginner friendly. The user interface is very easy to learn and master. Blockchain even includes the function of revealing how much money has currently been put into the service, which is an admirable inclusion. Transparency is very important for any kind of service that deals with trading in high volumes. Blockchain’s dedication to making this kind of transparency so easy to access is a big thumbs up for earning trust among their users. At the time of writing, the “Bitcoin Money Supply” displayed on their site is listed at 16.85 million dollars.
BitGo may be the place to go if you want to have an online service that has a greater than average priority for security. Considered by many to have superior security protocols, BitGo’s homepage prides itself on its expertise in many technical aspects of protection. Along with more basic and common methods of security and management like 24/7 alerts and notifications and two-factor authentication, BitGo also has more advanced treasury controls, key recovery solutions and other advanced security protocols.
The webpage for BitGo delves into intense detail regarding the security measures that are taken. This includes the logistics and industry standard security that all of their online wallets feature. BitGo also has an impressive lineup of ovations from various businesses in the e-trading market, such as the CME Group or Genesis Global trading. Similar to the notion of transparency, this allows BitGo to build a reputation based on trust and reliability that exceeds many other services.
BitGo also has the benefit of dealing in multiple currencies. Bitcoin is of course the main attraction, but Bitcoin Cash, Ethereum, Ripple, Litecoin and a couple others are supported as well, which is more attractive to long term users who may wish to diversify later on. And considering how much effort has gone into the security measures of their online wallet, BitGo may be the choice to go with if one is considering long term online storage.
It isn’t as beginner friendly as Coinbase or Blockchain.info, and learning the more advanced functions will certainly go over the heads of many beginners. BitGo also makes an effort to advertise themselves to larger businesses dealing in larger volumes, not so much the everyday man who wants to make a small profit. Despite this, BitGo made our list because they have proven that online wallets can push the boundaries of online security, and that alone is certainly admirable and worthy of mentioning.
When discussing the best online Bitcoin wallets, security won’t always be the most important factor. Online wallets often have to make the sacrifice of giving up tighter security for more interesting, innovative and convenient mechanics that separate them from the rest of the crowd. That is where Coinapult comes in.
Like many other popular services, Coinapult has newcomers in mind with the added functionality of being able to send crypto via SMS or email. While this sounds like a niche function or even a gimmick, it does have its uses. On the surface level, Coinapult transcends the typical categories of Bitcoin wallets despite being generally considered an online web service.
Imagine being able to send someone you know some Bitcoin just through your phone, as easily as sending them a good morning message. This is a revolutionary idea with great potential because SMS messages don’t use the internet, which makes Coinapult partially online, but partially offline. It’s online because the coins are taken from a predetermined location, but it’s also offline because they are then sent via telecommunications.
If you link your phone number with Coinapult, you can then send and receive Bitcoin to other linked numbers. Following a list of commands that are typed into your phone, you can view recent transactions, send Bitcoins, view invoices and more. Coinapult even included the option of automatically adding phone numbers to their service should you send crypto to a number that is not yet currently registered.
It may not sound like an idea that is attractive to most people who are looking for simple ways to perform transactions. But the fact that such an idea was realized in the first place speaks volumes about the possible directions that crypto services can head in. Not to mention the idea of sending someone Bitcoin directly to their phone as a simple gesture could be the first step in making the entire cryptocurrency technology more mainstream. Much like how we send direct deposits or even certain bank transfers via email, Coinapult shows ways in which Bitcoin can be just as good and accessible as regular money in the near future.
One of the more popular exchanges, GreenAddress combines the social element of Coinapult with the security measures of BitGo. While it doesn’t sport the ease of something like Coinbase, a few key features set it apart from more popular services, including how it handles your keys themselves.
GreenAddress, at no point in time, ever directly handles all of your keys on the server side of things, even when they are encrypted. What does this mean for you? Basically every transaction needs to be authorized by both the third-party and you. When you access your wallet or when you make a transaction, your account needs to be verified using multiple signatures, one possessed by GreenAddress and one possessed by you.
Usually referred to as “multisig” wallets, GreenAddress will only verify and sign a transaction if it is within the limits you have specified on your account, and only when two-factor authentication is enabled. Granting extra and direct access to your own keys is a big step in having extra security and protection.
GreenAddress also has a very interesting feature that is sure to satisfy the most compulsive wallet checkers out there. Referred to as watch-only mode, this allows you to check your Bitcoin balance (presumably to check your account balance or make sure it hasn’t been hacked or compromised) without sacrificing any privacy. As all online wallets are accessed through a web browser, generally your keys need to be loaded in order to access your wallet. This puts them at risk as your keys are then out in the open, so to speak. But with watch-only mode you can check your wallet without the website having to load your keys. It allows you to safely check your balance while reserving your keys for the truly important actions.
As for the social side of things, GreenAddress also allows you to send Bitcoin via social media, particularly Facebook and Reddit, though email is supported as well. Just another way in which Bitcoin is slowly seeping into our mainstream lives and truly earning its name as the currency of the internet.
A desktop wallet is still the most popular way to have total control and protection over your Bitcoin holdings. Sometimes people think it is sufficient to refer to them as “offline wallets” in contrast with online wallets but this isn’t exactly true. There are other “offline” wallets as well that work entirely differently, and desktop wallets still have to be downloaded off of the internet, and they need to be connected once again to update the balance should any other transaction transpire.
While it may already seem obvious, desktop wallets have the best protection because you have total access to your keys when dealing crypto. When performing transactions via an online exchange or wallet, your funds are much more vulnerable mainly because it is a lot harder to hack a public domain database then it is a lonesome, random computer.
There are setbacks, though many consider them to be trivial sacrifices for the increased protection. You cannot deal from any portable devices using these kinds of software because they are inherently tied to your computer, as is implied in the name. Not to mention setting up a wallet, obtaining your very own Bitcoin wallet address and learning all the security protocols can be daunting for beginners, which is why so many opt for the easier options of just using Coinbase or Blockchain.
Regardless, if you feel ready to dive into the world of desktop wallets, then here’s our top 3:
Electrum makes the first on our list because we wanted to help emphasize convenience. Electrum is relatively easy to install and hosts several useful features that are great for beginners and veterans.
Many people use Electrum because it is fast, safe and private. The software does not download all of the blockchain information when performing transactions and merely requests what it needs from a separate server, making the entire software efficient and speedy to use. And of course, your private keys never leave your computer and you can go online in a watch-only mode similar to GreenAddress.
Electrum is also very low on power consumption and does not need to be downloaded on a higher end PC. Some wallets come downloaded with the entire blockchain’s information along with them, which means taking up a lot more storage, generally dozens of gigabytes. Downloading Electrum will only set you back far less than a single gigabyte.
The features that Electrum offers are also quite practical and useful for a variety of activities. You have influence over setting your own transaction fees, which is a great way to have control over your own payments without having to pay more than you have to.
You can also change your wallet address should you feel the need to. Changing your address is often seen as an extra security precaution than anything else. Some would recommend to change your address after every transaction or so to minimize the odds of compromising your wallet. While it is not particularly difficult to do this, especially with a system like Electrum, some may find it needlessly excessive. Use this feature at your own discretion.
All in all, Electrum has built the reputation it has as a reliable desktop wallet for offering relatively easy use for both the person and the hardware involved. The interface is clean and simple and the included features all have a balance between achieving protection and an intuitive system of use and interaction.
Since launching in 2014, Bither has amassed quite the name for itself. It has launched on multiple platforms including iOS and Android for portable usage, but we’re going to look at its more popular function as a desktop wallet.
Like Electrum, Bither gives you full control over your keys, even when they are encrypted. While total access sounds like an act of freedom, it also means total responsibility. You must be the one who takes the extra precautions in managing your Bitcoin addresses and such, and if you should ever lose your wallet or keys due to any kind of unfortunate event, you and no one else are at fault.
One nice act of transparency Bither has is that its source code is readily available online. That means that the software’s architecture is free to browse and redesign for anyone’s purposes. That doesn’t mean much to the average user who just wants to acquire some Bitcoin. But it is always good to know that the people behind the software will allow such transparency of their product to occur. It is often taken as a sign of good faith and good trust in a digital world where hacking is allegedly a looming threat.
Bither also contains a feature called XRANDOM that guarantees a more efficient random number generator for creating newer and more secure addresses. This is another way how the wallet guarantees to provide a simple and secure e-trading experience for its users.
This wallet is one that is not as beginner friendly as the previous wallets, but it holds a special place in the hearts of many Bitcoin enthusiasts for many reasons. Because of this, we knew that Bitcoin Core just had to make our list of the best desktop wallets for its pioneering features.
A little history lesson: Bitcoin Core was the first Bitcoin wallet ever produced. It was the pioneer in token encryption and set the standard for many, if not all, cryptocurrency wallets that soon followed. But it didn’t just make our list because it set the standard. Bitcoin Core stands tall with its own strengths and not just its reputation as originator.
What separates Bitcoin Core from other wallets isn’t its age, but its intensive features. This makes it less accessible to newcomers, but users with advanced or even intermediate experience can heavily benefit from Bitcoin Core’s unique aspects.
Like Bither, Bitcoin Core promises full transparency. The code is completely free to peruse and modify and is fully available on the internet. That makes Bitcoin Core a completely open source piece of software.
More specifically, Bitcoin Core is known as a full Bitcoin client. You’ll be downloading a lot more than simply a place for storage if you choose to go with this wallet. This means that you will be actively participating in the accurate synchronization of the blockchain itself when you set up an account. All information pertaining to the entire history of Bitcoin transactions will be part of your computer, and will constantly be updating and downloading new data. In layman’s terms, downloading Bitcoin Core means setting up a node on your own computer that directly interfaces with the blockchain.
This is ultimately the reason why Bitcoin Core is not particularly accessible to newcomers or beginners, especially these days. It was estimated that the total amount of data that would be downloaded along with the basic Bitcoin Core user interface and wallet was roughly 65 gigabytes over a year ago. Now according to bitcoin.org, that number is now over 145gb. In other words, only true enthusiasts with a particularly strong computer and a better than average internet connection will be able to truly handle Bitcoin Core, let alone reap its benefits.
Full Bitcoin nodes such as this one provide absolutely top notch security because they validate and relay transactions on the blockchain. This means no trust in third parties is ever required in the verification of payments or even transaction fees, which is also something that Bitcoin Core gives you complete control over. The network is partially strengthened and kept up to date by people who willingly allow their computer to stay online long enough to provide the relevant data. It is this feature that helps keep the very lifeline of Bitcoin itself strong for all of its users.
Now let’s move into the realm of portability:
Portable App Wallets
Bitcoin wallets moving to smartphone devices seems like the next logical step for a currency that is trying to become the standard fiat of the internet. People are already ordering things via eBay or Amazon on their phone, and in some instances are even paying their bills or sending invoices this way. Bitcoin making its way to the mobile market is about as predictable as it gets.
The thing about portable app wallets, whether they be for iOS or for Android devices, is that they maximize convenience while sacrificing some security. Like using simple website services such as Coinbase, we recommend highly that you utilize these kinds of software only if you are dealing in small volumes. We know the idea of trading Bitcoin on your phone sounds cool and hip but please remember to be safe and responsible with your crypto holdings as much and as often as you can.
Perhaps the most popular wallet for Android devices, Mycelium has the user-interface and functionality that has impressed people all over the world. Despite being on mobile devices, the company assures its users that they have high level security features. This includes hierarchical deterministic (HD) wallets, a watch-only function for safer viewing, and more.
We have to give it up for the Trezor compatibility though. Mycelium allows you to transfer your crypto onto the Trezor dedicated hardware wallet (which we will review in our upcoming and last section). Many portable apps don’t offer this kind of cross-platform functionality, which really makes Mycelium an innovative choice. Of course this means you’ll have to be spending extra money on another device. If you’re the type who is only looking for short profits without making too much of an investment, you may want to skip on that option. But if you want portability, convenience and high end security, the Mycelium and Trezor combo could be for you.
We also can’t just ignore Mycelium’s extremely sleek and attractive aesthetic design. This is probably the best looking and most eye-pleasing crypto related software there is. While trading crypto is not usually thought of being done in style, you can definitely get that done with Mycelium if that’s your cup of tea.
The main reason why Coinomi made our list admittedly doesn’t have too much to do with Bitcoin functionality, but cryptocurrency support in general. Coinomi is impressive because of its exhaustive database that sports dozens upon dozens of different coins.
It is currently available on Android platforms, but an iOS version has been in the works for a while and is to launch soon. Coinomi features a massive amount of altcoins in addition to Bitcoin, including well known ones such as Ethereum and Litecoin. But it also sports several lesser known and even downright obscure ones like Shadowcash, Zcoin, Namecoin, Digibyte…the list goes on.
Coinomi makes our list because we aim to show the full gamut of Bitcoin wallet possibilities, and that includes showing off wallets with an exhaustive list of supported currencies that can only be described as a library. There are so many different coins here that the most serious Bitcoin traders will find something they’ll enjoy.
Many Bitcoin enthusiasts care about diversification in terms of the exchange services and wallets they use and the coin they exchange. Coinomi allows those users to deal in as many coins as they can choose from, and do it while on the go as well.
Perhaps the best wallet available for iOS, Breadwallet emphasizes easy use and an accessible interface, making it the perfect platform for newcomers to the craze of crypto. You can safely store your coins without having to learn any of the intricate nooks and crannies of the blockchain.
Breadwallet really emphasizes minimalism and simplicity. It won’t have the extra features of other services we’ve previously looked at, so this is a wallet that is truly aiming at the novice market. If all you want to do is buy Bitcoin with money and store it on your Apple device, with no extra strings attached, then breadwallet is perfect for you.
Security features include fingerprint authentication, which helps secure your tokens should you ever lose your physical device. Breadwallet is also an HD wallet and even promises to protect your Bitcoin from malware.
Portable Hardware Wallets
Hardware wallets, also referred to as analog wallets, are actually the closest things resembling traditional wallets. Often resembling large car keys, these are miniature digital devices that store all the information relevant for accessing and storing your Bitcoin. Many of the most diehard crypto enthusiasts swear by these things because they aren’t even comfortable with storing their token directly onto their computer’s harddrive.
As Bitcoin was designed to be a decentralized currency, hardware wallets take that notion to a more physical and natural conclusion. This feature really allows you to have your coin that is completely disconnected from the internet and is always by your side, even if your computer or phone is turned off.
Trezor is a brand that is small, simple, and easy to use. It comes with security measures that protect against malware and even disaster recovery in case theft or loss occurs. This wallet exploded in popularity when it first hit the market. Many swear by the peace of mind that comes with always knowing that your crypto can lie safely in your pocket, attached to your keychain.
The device itself is sleek and smooth and is also easy on the eyes. The interface is cleverly designed when synced with an external Bitcoin trading service because the buttons must be physically pushed when transactions are asked to be verified. It also has a sophisticated PIN system that increases the time it takes to input the password each time a wrong guess is entered. Truly foolproof technology went into its design.
Registration is quite simple and not intimidating at all. You can either go to myTrezor.com or use the Google Chrome extension to get started, and the rest is history.
The final wallet on our list is one of the most popular hardware wallets, and competes admirably alongside Trezor. Supporting Bitcoin, Ethereum, Litecoin and many other altcoins, the Ledger is a USB based device that can connect to any computer and has an LED screen for displaying information.
The Ledger Nano S is particularly popular these days and is one of the best-selling hardware wallets. It is even thinner than the Trezor and is arguably more stylish. It is malware proof and makes sure that your encrypted keys are never known to a third party.
It’s also important to note that the Ledger Nano S is cheaper than the Trezor, and features slightly more software compatibility. Both devices are compatible with services like Mycelium and even My Trezor, but only the Ledger is compatible with Ledger Chrome and KeepKey Chrome extensions.
The potential problem though is that the Nano S is a newer piece of hardware, so it isn’t quite as reliable as the Trezor as it hasn’t been tested yet by as many people. So far so good, but if you’re entering the world of hardware wallets based off of obsessive security concerns, you may want to keep this in mind.