| Company | Number of currencies supported | Supports Bitcoin | Embedded Exchange | Customizable fees | Compatible Material |
|---|---|---|---|---|---|
| Exodus Ideal for beginners | 150+ | Yes | Yes | Yes | Yes |
| Electrum Best for Bitcoin | 1 | Yes | Nope | Yes | Yes |
| Mycelium Ideal for mobile | 7+ | Yes | Yes | Yes | Yes |
| Guardian Ideal for security | 400,000+ | Yes | Yes | Yes | Yes |
| Coinbase Wallet Ideal for low costs | 500+ | Yes | Yes | Yes | Yes |
Want to know more about digital currencies? You’re not alone.
Most adults have a beginner’s understanding of cryptocurrency, but plan to use these assets as a key source of retirement funds, according to the 2022 Investopedia Financial Literacy Survey.
How to Choose the Best Cryptocurrency Wallet
Choosing the best cryptocurrency wallet largely depends on your personal needs. Here are some helpful tips for choosing the wallet that’s right for you.
How often do you plan to use your wallet?
How often you plan to use your crypto wallet plays an important role in deciding which one is right for you. For example, if you plan to use cryptocurrency to make regular payments, you’ll probably want to keep some of your funds in a mobile wallet. But if you’re looking to invest in and store crypto assets for the long term – and if you’re looking to store a large amount of digital currency – you’re better off securing your digital assets offline in cold storage using either hardware or paper wallet.
If you plan to actively trade digital assets, you will likely benefit from a cross-platform wallet that allows you to manage your cryptocurrency portfolio on your desktop computer and on your smartphone.
Are you interested in the number of cryptocurrencies supported by the wallet?
If you are looking to build a diversified portfolio made up of a large number of digital currencies and tokens, choosing a multi-asset portfolio that supports thousands of assets is probably the right decision.
Do you care about the level of customer support?
If you’re a beginner, you’ll probably want to opt for a beginner-friendly wallet with an easy-to-use interface.
Not all wallet providers have customer support. Many long-standing open source wallets, for example, offer no customer support. If you think you need help with your wallet, choose one that lets you interact with a human customer service agent by phone or live chat.
How important is security?
Are you just looking to test the waters in the brave new world of crypto? Or are you looking to make a substantial investment? Depending on your plans, security will play a relatively small or very important role in choosing a wallet.
You may be looking for a desktop wallet that you can secure with an encryption password. Or maybe you want the best security that crypto storage solutions can offer.
Backing up your wallet is one of the most important aspects of crypto wallet management. Do you just write down and securely store a recovery phrase, or would you rather only have to remember a username and password?
Choosing a wallet with a backup feature that works for you is another essential security measure when it comes to choosing a wallet.
How important is owning your private key?
Are you comfortable with a third-party provider holding the private keys to your wallet (and therefore de facto ownership of your virtual assets)? Alternatively, you can choose a non-custodial wallet where you are responsible for managing your wallet’s private keys.
Although these wallets are considered best practices because you have full control over your virtual assets, if you lose access to your wallet or forget your encryption password, you will lose all funds held in that wallet.
Frequently Asked Questions
What is a cryptocurrency wallet?
A cryptocurrency wallet is a digital wallet that lets you store the unique digital codes needed to send and receive crypto assets, such as Bitcoin, Ethereum, and Dogecoin. It is important to point out that these wallets do not store your actual cryptocurrencies, despite what their name may lead you to believe.
Cryptocurrency wallets are actually more of a ledger, as they hold the keys to the identity of the owner, allowing them to access a blockchain network and transaction history. These wallets need to locate the cryptocurrency associated with your address in the blockchain, which is why they need to interact with it.
What are the types of cryptocurrency wallets?
Software, hardware, and paper wallets are the three main types of cryptocurrency wallets that fall under the two main categories of wallets known as hot and cold wallets.
Cold wallets have no connection to the internet and come in a physical form, like a hard drive or a piece of paper, making them the most secure wallets possible. Hot wallets, on the other hand, have some form of internet connection, which makes them more susceptible to security breaches.
Hot wallets are favored for their flexibility, such as the ability to access your funds or trade on the go. These software wallets come in the form of web wallets, desktop wallets, and mobile app wallets. It is important to point out, however, that this availability results from the web connectivity of a hot wallet, which inherently leaves your funds open to some form of vulnerability.
In the case of cold wallets, the only way to lose your funds is if the wallet itself is lost or stolen and no backup procedure has been put in place. Unfortunately, this higher level of security does not allow your funds to be readily available for trading or trading when you are away from your computer.
Most major crypto wallets today are hybrid wallets that offer desktop and mobile access, with the ability to connect to a hardware wallet for maximum backup protection.
How do cryptocurrency wallets work?
Cryptocurrency wallets provide public keys and private keys to allow crypto users to interact with their digital assets stored on public blockchain networks. A wallet’s public key is the wallet address where you can receive funds and the private key is what you use to access your funds to make transactions.
Think of the public key as your bank account number and the private key as your bank account PIN that you use to log in and make payments.
Methodology
One of the most important things to consider before trading and storing cryptocurrencies is that you have a proper crypto wallet. To help you decide which wallet is right for you, we conducted a comprehensive review process of the best cryptocurrency software wallets.
Our review process is built around a quantitative rating model that rates key factors such as security, cost, privacy, usability, customer support, and features based on their importance. Our team of researchers gathered over 40 data points and conducted extensive research for each of the 19 companies we reviewed. Our team of editors, experts in this field, then tested each wallet to provide their qualitative point of view.
Our model gave preference to companies with the strongest security measures and reputations. Companies with rich features, such as support for a large number of crypto assets, the ability for users to sync with hardware wallets, and the ability to customize fees, also rank highly.
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