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What is Bitcoin wallet indeed

It's an address on the Bitcoin blockchain, and it includes 2 types of keys - public and private. The public key is the address to receive Bitcoins. The private key is proof of ownership.

You can compare it to an email. You have a public (if someone knows it) address and a password to access the email. Anyone who knows your address can send you messages. You can control your email only if you're logged in (with your passcode, password, 2FA, etc.).

It's pretty much the same but this time we talk about Bitcoin and Blockchain.

Bitcoin Wallet Types

There are many types of wallets, and sometimes it may become a hard process to choose the right one (especially when it comes to mobile or desktop version). However, it's always better to have a complete overview of what's available.

Bitcoin Wallets

What's the difference between each wallet:

  • How are your private keys stored.
  • Interface and usability feature you can benefit from.
  • Which security options are included - 2FA, passcode, PIN, encryption.
  • Easiness (especially for Beginners).
  • Advanced tools - rates, alerts, charts, and more.

Exchange wallet

Many crypto exchange platforms keep your coins in their wallet. This way you can access the funds only through your profile (with your login details).

btc Exchange wallet

In this case, your private keys are not your own, and it's risky to continue this way. If there is a global problem with this exchange, you may lose your crypto coins.

Take a look at a few examples, and how your coins may be lost forever. These are the biggest heists in history (until May 2019):

  • May 2019, $40 million from Binance (7000 Bitcoin)
  • January 2018, $530 million from Coincheck
  • July 2017, $70 million from 'The DAO' (3.6 million ether)
  • August 2016, $66 million from Bitfinex (120,000 Bitcoins at this time)
  • February 2014, $450 million from Mt. Gox
  • 2012, 24,000 Bitcoins from BitFloor

If you wish to take the risk and put your money in a wallet of crypto exchange, it's up to you. Otherwise, you can continue reading this article and choose the right solution to keep your crypto.

Mobile wallet

It's a mobile app with an interface. Usually, the wallet is an application available for download from the app store like Google Play and Apple iTunes. The mobile form has everything you need to create a wallet, but you should consider your security if you intend to keep the more significant amount of BTC.

btc desktop wallet

Most mobile apps allow skipping the security sections to simplify the setup process. It's good to get started quickly, but it's hazardous if you forget to secure your wallet at a later stage.

A common practice is to download a mobile wallet, configure everything, right down the mnemonic phrase, receive your BTC, and then delete the app.

Good Example: Blockstream Green (Green Address).

Notice: These wallets are free.

Desktop wallet

It's a desktop application (software) which you can install on Windows, Mac or Linux computers (PC or laptop). It's a software with different compatibility depending on your operation system. It's right first to read the technical requirements if you run an 'older' computer.

Get BTC Wallet

The desktop wallet works like the mobile app, but you can manage it from your computer. This way may need to consider what antivirus you're using, is there an issue with your firewall and some other related settings.
The desktop edition is much easier to manage the wallet because you have a bigger screen, keyboard, and controllers (not only a touch screen).

It's highly recommended to use a wallet on a safe device.

Paper wallet

That's a popular method to hold your bitcoin amount. It's available outside of an electronic device, and you can use only the mnemonic phrase and QR code. It's a paper with your public and private keys.

bitcoin Paper wallet

The paper version is not the best possible way to keep your coins, because the paper can be damaged and it can be a problem to recover the wallet.

Also, these wallets use only one BTC address, and there is reuse. It's not possible to generate a new address.

Hardware wallet

That's a specific device with software. It's different than any other device like laptop, tablet, smartphone. Usually, it's small hardware with a screen, few buttons to manage the wallet and software. These wallets are widespread, and there are excellent solutions like Trezor and Ledger. The hardware wallet can be a solution to store sensitive information, passwords, and other encrypted data.

best bitcoin wallet

For many reasons that's the best way to keep your crypto, but they are not free, so you need to buy one (it's about $100-$200). If you choose to order a hardware wallet, the best way is to use the official website of the company (to avoid any possible vulnerabilities).

This type of wallet has a manual on how to set up everything. Also, you can store different types of cryptocurrencies (not only Bitcoin). You can connect a hardware wallet to smartphone, tablet or computer using a cable.

Examples:

Cold Storage

That's a wallet with no Internet connection. It can be a crypto device, disconnected mobile wallet, or something else by your choice. The market recognizes the cold storage as a blockchain device.

Which Wallet to choose

It's evident that you have a choice. If you wish to try how it works, and what's going on really, you can choose a mobile or desktop wallet. Then you can proceed to cold storage, and hardware wallet (which is the ultimate solution).

In case you don't have time to waste, you may jump directly to a hardware wallet.