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What is crypto wallet? How to choose the safe one?

22 August 2017 13:55, UTC
Crypto wallet is a local store of private keys. They allow to carry out operations with cryptocurrency located in the blockchain. So the difference between wallets depends on the ways of storage keys.

Desktop wallets

Desktop wallets require the download and installation special software on a PC or laptop. This software can be used for sending and receiving currency and creating a crypto address. Private keys are stored in a special file on a hard disk or another storage media. There are two types of desktop wallets – heavy and light. All of them required installation on a PC. Heavy wallets needed regularly downloading the blockchain to the blocks that are always installed. Light wallets’ software takes all necessary information from the third-party services. It’s easy but less safely.

Mobile wallets

Mobile wallets are run from a smartphone apps. They are good in functionality and ease of use. These are some advantages of mobile wallets:

  • they allow to pay for goods or services in the store without the necessity for linking to the computer or laptop;
  • high disbursement speed.

This type of storage is good for people who always need an access to their wallet. Mobile wallets have one common feature – they are not a full crypto wallet due to a lack of memory, the whole blockchain can not be loaded. So mobile wallets are light.

Hardware wallets

Hardware wallets looks like flash drive or another device with USB port. They are much safer than the previous two because the private keys are generated offline and there are less ways to hack them. It’s also very convenient way to carry cryptocurrency from place to place. At the same time hardware wallets not free, they cost about 100$.

Online wallets

They are also called web wallets. Online wallets are quite easy to setup but they are not safe. Private keys are stored in the internet, so the wallet is controlled by the website administration. Web wallet is convenient for trips or online shopping. It can be used from any device with internet connection.

Paper wallets

In this type of wallet public and private keys are printed out and stored in a list of paper. There are plenty of websites that allowed to generate and print these keys. Obviously, that paper can not be the object of hack attack. But there are some other risks. A piece of paper can be stolen, eaten by a dog or just lost.

So, which to choose?

Each wallet has pros and cons. If you have a large amount of cryptocurrency it would be a wise decision to protect them the best way – heavy desktop, hardware or paper wallets. For small frequency transactions online wallet is a good option.