Crypto wallets are the key tools that help users store, manage and secure their digital assets. There are many different wallet options available, from hosted to non-custodial and hot to cold. Each provides trade-offs between convenience, security and level of ownership. When selecting a wallet, it’s important to consider how much a user values each of these factors.
Hosted wallets, commonly offered by cryptocurrency exchanges, hold a user’s private keys on their behalf. Accessing these wallets is as simple as logging in to an exchange account. These wallets can be vulnerable to hacking attempts because the third party holds the private keys. Custodial wallets are a good option for beginners, or those who prefer to use the services of an established cryptocurrency platform.
Top Crypto Wallets for Secure and Reliable Storage
Non-custodial wallets are self-contained and allow a user to access more advanced features like yield farming, staking and lending. However, these wallets can be more difficult to set up and require a greater level of technical proficiency. Additionally, hardware wallets can be expensive to own, typically costing between $60 and $120.
A cold wallet is one that is not connected to the internet and requires a physical device, usually the size of a thumb drive, to store the private keys. These devices are often sold by well-known manufacturers like Ledger and Trezor. These devices can be more secure than a laptop or smartphone, but can still be tampered with by hackers. In addition, hardware wallets must be stored carefully to ensure their security.
