If you are choosing your Bitcoin wallet randomly, you are doing it wrong.
This is probably the worst mistake one can make that could result in the loss of bitcoins, all at once. Not just that, choosing your wallets based on suggestions by a friend who is only a day older in experience than you in crypto is not a wise decision.
One has to be serious while choosing a Bitcoin wallet because the wallet is something where your private keys and public keys reside, which if compromised can result in you losing all your bitcoins.
In a detailed write-up on Bitcoin wallets in the past, I mentioned the different types of wallets, but not which to use when.
I did so deliberately because which wallet to use and when is a separate topic altogether that requires a dedicated guide like this one.
So here I am today, to share with you how to select a Bitcoin wallet for yourself.
This guide will enable you to understand different wallet options you have and which one you should pick for storing a little or a huge amount of Bitcoins.
How To Select A Bitcoin Wallet (Complete Guide)
When selecting a reliable Bitcoin wallet, irrespective of whether it is a software or a hardware wallet, one should judge it based on the following criteria:
- Control private keys: A wallet where you own and control your keys. (Non-Custodial wallet)
- Backup & security features: Seed backup keys and pin codes.
- Developer community: Active development community for maintenance.
- Hot/Cold Wallet: Whether a wallet is a hot or cold wallet.
- Ease of use: Elegant UI for fast and easy use.
- Compatibility: Compatible with different operating systems.
- HD Wallet: A wallet that generates new addresses itself.
- KYC: A wallet that doesn’t require KYC.
- Multi-blockchain support: As the crypto market is growing, a wallet that let you store other blockchain assets is something you should consider too.
- Access to Decentralized exchanges & dApps: This one is for advanced users, but something that will be really helpful in the time to come.
These are a few aspects that you should look into for any type of wallet you are going to use for any purpose.
But there is more to it.
The purpose for which you are going to use a particular wallet also plays an important role in selecting which type of wallet is required by you. Some of the purposes are:
- Long-Term Savings
- Short-Term HODL
- Daily Transactions
- Daily Buy/Sell or Trading Of Crypto
Choosing The Best Bitcoin Wallet (Let’s make it easy for you)
Based on the above-mentioned criteria and purposes, one can easily select a good Bitcoin wallet for themselves.
Let me explain in detail.
Hardware wallets are wallets that satisfy all the mentioned criteria. Moreover, they are cold wallets that never comes in contact with the internet directly. So if you are someone who wants to store their savings for a long-term then hardware wallets are the most suited option for you.
Also, they are HD wallets that never re-use the same public address again. You can also use a hardware wallet by connecting it to an infected device.
Some of the hardware wallets that we trust are:
Here is a video tutorial series by Harsh Agrawal on Ledger Nano S & Trezor.
There are some software wallets that satisfy all of the 8 criteria of a good wallet, so one can also look at these wallets as an option based on their purpose.
Also check out: Best Hardware Wallets For Bitcoin ( + Altcoins Supported).
Let us say the purpose is to HOLD some cryptos for a short period of 2-3 months. In this case, desktop wallets are a good option to go for. Desktop wallets are hot wallets that connect to the internet as soon as one goes online.
But they provide other security features of back seed, PIN code, as well as HD wallets to satisfy the short-term need.
Moreover, remember, this type of wallet will always be at risk of malware and virus if any on your device. Some of the wallets that one can look for in this category are:
Note: For short-term HODL, up to 2-3 months, as an extra caution people use hardware wallets too and I am one of them. If the hardware wallet supports that currency I always prefer using that one.
Mobile wallets and web wallets are the other kinds of software wallets. Most of the mobile wallets fulfill all the criteria that I have mentioned but there are very few web wallets that match at least some of the criteria that we need.
That is why, if you want to use these wallets for daily crypto trading with security measures like 2-FA authentication, it is alright, but for long-term or even a few days, it is risky storing your cryptos here.
On the other hand, there are many mobile wallets that satisfy our criteria and are fit for doing small daily transactions and even crypto trading.
Some of these wallets are:
These mobile wallets are very handy and can be used by anyone on the go to purchase daily routine things.
Note: Though these wallets satisfy the criteria, it is not recommended to store large amounts of Bitcoins on them because they are hot wallets that are always connected online.
Conclusion: The Best Ways To Store Bitcoin
There are different types of wallets available but not all are worth using because many wallets are created just to scam people.
Also, do look for multi-sig functionality in the wallet. By using this feature, you can make your Bitcoin wallet even more secure. However, this feature is not supported by many wallets.
- Also read: Best Multi-Signature Bitcoin Wallets
It is perfectly fine to use multiple Bitcoin wallets for multiple purposes too.
Write back, using the comment section below, and tell us which wallets you use to store your bitcoins.
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Here are a few more hand-picked articles you should read next:
- Top Wallets To Store ERC20 Tokens
- Which Cryptocoins Does Trezor Hardware Wallet Support?
- How To Claim GAS In NEO & Best Ways To Earn Free GAS
Harsh Agrawal is the Crypto exchanges and bots experts for CoinSutra. He founded CoinSutra in 2016, and one of the industry’s most regarded professional blogger in fintech space.
An award-winning blogger with a track record of 10+ years. He has a background in both finance and technology and holds professional qualifications in Information technology.
An international speaker and author who loves blockchain and crypto world.
After discovering about decentralized finance and with his background of Information technology, he made his mission to help others learn and get started with it via CoinSutra.
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