In the wake of FTX’s implosion, it is important to understand why you should not keep your cryptocurrency on exchanges for the long term. A cryptocurrency wallet is the most basic instrument for safely investing in cryptocurrency. In this article we will break down the best cryptocurrency wallets and how to use them.
What Are the Different Types of Cryptocurrency Wallets?
Before choosing a wallet to use to store your cryptocurrency, there are a few principals to understand.
- Not every wallet is compatible with every cryptocurrency. Some support multiple currencies, but not always. For example, you may not be able to use a Bitcoin wallet to store Ethereum. Each cryptocurrency wallet has its own set of tokens that it supports.
- Storing your cryptocurrency with a centralized third party, like Coinbase, BlockFi, or Gemini, is not the same as storing it in a wallet. When you store your crypto with these services, you are at risk of losing it should the company go under (see: FTX). When storing your crypto in a wallet, only you decide what happens to the funds.
- There is a famous saying in the crypto world- “Not your keys, not your crypto”, and it is true here.
There are a two different categories of crypto wallets:
- Cold Storage- A wallet that is considered “cold storage” means that it is entirely disconnected from the internet and only accessible with a piece of physical hardware. This is the most secure wallet.
- Hot Storage- A wallet is considered “hot storage” if it is connected to the internet at all times. These are most digital wallets.
The Best Affordable Hardware Wallet
The Ledger Nano S Plus is the newest addition to the Ledger cold storage wallet family. Ledger has been in the business of cold storage wallets for a long time, and they continue to innovate and bring better products to the market.
The Nano S Plus supports nearly 500 different cryptocurrencies, including BTC, ETH, and ERC-20 tokens. It also supports DeFi and NFT integrations.
Ledger has two products: the Nano S Plus and Nano X. The Nano X is the original wallet created by Ledger, while the Nano S Plus is the newer, more affordable version. At only $79.99, we think it is the go-to version for newcomers to the cold storage game.
The Best High-End Hardware Wallet
The Trezor Model T cryptocurrency wallet is arguably the most advanced cold storage wallet on the market today. While coming in at a steep price point of $213, it is almost required for cryptocurrency power users.
Sporting a 1.54 inch touch screen, the Trezor Model T currently supports over 1400 cryptocurrencies. Unique to Trezor is the ability to natively swap and trade cryptocurrency within the wallet’s software. There also are options for identity masking and additional password recovery security.
The Best Cryptocurrency Wallet for Beginners
If you are new to the crypto space, MetaMask is going to be the best wallet for you. MetaMask is free, and all that is needed is a computer with Google Chrome. With MetaMask, you can store your cryptocurrency securely on the extension, use blockchain apps such as DeFi programs or NFT games like Axie Infinity, and transfer funds between wallets. It should be noted that MetaMask is an Ethereum based wallet, meaning it only is compatible with Ethereum, Ethereum based coins, and Ethereum chain NFTs.
The extension is easy to use, and they even have a mobile app to access your wallet on the go. It should be noted that since these wallets are online, if your private key is leaked it could be accessed by a bad actor looking to steal your funds. If security is your top priority, then you should look into investing in a cold storage, hardware wallet.
The Best Cryptocurrency Wallet for NFT Games
If you are an NFT enthusiast, you are going to want a wallet that makes it easy to manage and swap all of your NFT properties. For this, we recommend Enjin Wallet. Enjin Wallet allows you to actually create many different wallets for different purposes. This is extremely helpful if you play NFT games and want to track each game separately.
Enjin also allows you to swap cryptocurrencies within the Wallet itself by linking to protocols such as Bancor or Kyber. This can be extremely useful for users that are constantly looking for new opportunities in different markets. Enjin also hosts its own NFT marketplace, EnjinX, with many different NFTs for users to buy and sell.
For security, you can also use Enjin with hardware wallets such as Ledger or Trezor. This added security is much needed for power users, who are always at risk of asset theft.
There are many different options for you to choose from when deciding on a cryptocurrency wallet. While each has its advantages, it really will come down to what your goals are for the wallet.