More and more wallets are invading the marketplace, is there a need to store cryptocurrencies in wallets? Or do you store these digital assets in an exchange?
If you store it in an exchange, meaning that you hand the private key and asset over the exchange and trust it to secure your crypto for you. In this case, you have to trust the exchange’s level of cyber security and the integrity of their operation team.
Furthermore, as an exchange with custody of many clients’ funds, the likelihood of being hacked increases as the amount of cryptocurrencies deposited in the exchange grows.
In the belief of empowerment, traders should take the responsibility of safeguarding their assets by themselves. With these many wallets in the market, you have to understand the distinctive characteristic of various cryptocurrency wallets and choose the best fit for yourself.
Cryptocurrency wallet is fundamentally an operational interface. You use it to connect to the blockchain network and manage your blockchain assets. Similar to using an ATM, you are able to connect to the bank’s system with the ATM card and freely withdraw or transfer the money inside the bank account.
You can also picture ATM card as a private key. You withdraw/transfer your assets on different bank’s ATMs with the ATM card. Identically, you manage your account on different cryptocurrency wallets with the same set of private key and handle the blockchain assets inside by importing/exporting your private key to different wallets.
We selected 7 popular wallets and made a comparison for traders to have a better overview of them
There are several types of cryptocurrency wallets, including browser extension, mobile application, or hardware wallet. The lingo used to classify types of wallets are hot/cold wallet. For most people, hot wallet is rather accessible, easy-to-use but with higher security risk. Comparatively, cold wallet has better security. But you usually have to pay for it and its threshold of using is relatively high.
Highest pro is accessibility, hot wallet is usually the first choice for most cryptocurrency newbies. Hot wallet stores the private keys in user’s device or browser, which means you are exposed to the internet while using it. Thus higher chances for hot wallets to be hacked and private keys stolen.
MetaMask is the most famous browser extension wallet. Since it runs on Google Chrome and Firefox, MetaMask has a huge user base. After finishing downloading the extension, you need to set the password according to your own preference. The password is different from private key. MetaMask stores your private key and the password is used for logging in MetaMask every time before using its service.
With MetaMask, not only you can transfer Ether to your friends and family immediately, but can you also use the DApps on Ethereum.
Mobile Application (APP wallets)
Beside the basic send/receive function, the newest trend for APP wallet is to integrate with browsers allowing users to browse and use DApp, or trade cryptocurrency directly from the wallet. Because of these additional functions, no matter you are on transit to office or rolling on your bed, you can connect to blockchain internet anytime and start using DApp services.
When using a cold wallet, the private key will be stored on a device that will not connect to the Internet. Therefore, cold wallets are more secure compared to hot wallets. Most hardware wallets have a small screen for users to operate and check the balance. You are required to press a button to “sign” whenever you are going to make a trade, this gives traders additional authority over transactions resulting a higher security value.
Ledger, Trezor and CoolWallet are the common choices of hardware wallets. Ledger and Trezor are able to connect directly to desktop through a USB cable. As for mobile phones, they only support Android devices. CoolWallet is a credit card sized wallet, it is thin and light that boasts great portability and supports both Android and iOS* devices with Bluetooth.
*iOS devices faces connection issues with Safari.
Different wallets have their own pros and cons. Just choose the one that fits your need. Hot wallets are suitable for newbies because they are easy to access and operate. On the other hand, cold wallets are for veterans who values safety since they can provide higher security but require more knowledge.
JOYSO hybrid decentralized exchange supports these 7 wallets. From Vitalik to the people! Trading made easier with decentralization.