See the best options to protect your investment safely
Cryptocurrency wallets are the most important items that any investor should be familiar with. They are applications or physical devices used to securely store your cryptocurrencies, much like physical wallets hold your money and cards.
As there are thousands of cryptocurrencies, each of them has different types of wallets. If you have any cryptocurrency that has undergone a large appreciation, having a wallet will help to keep your assets safe and only under your control.
But because there are several wallets, choosing the best one will depend on how much you have and what your usage needs are. Therefore, this text will explain what wallets are, what types exist, and what to consider when choosing between them.
What are cryptocurrency wallets
Wallets are a way to keep your cryptocurrencies safe, whether for everyday use or for long-term storage. Many wallets work online and can be used just like a banking app.
In general, cryptocurrency wallets store the following types of information:
- public key: It is the address that you will always use to receive cryptocurrencies;
- private key: password to access your wallet, necessary whenever you switch smartphones and need to redeem your coins. Without this key, you will lose your cryptocurrencies forever;
- balanceHow much cryptocurrency do you have in your wallet.
Types of wallets
With the evolution of cryptocurrencies, several types of different wallets have begun to emerge. All of them meet different usage needs and have different levels of security.
The two main types of wallets are classified according to their use and the level of security. In terms of use, wallets are divided into online and offline.
Online wallets
One of these types of wallets is online wallets, which work similarly to bank apps. These wallets are for those who use cryptocurrencies in day-to-day transactions, as they facilitate the payment for goods and services.
These wallets can be used directly on your smartphone and are used to store small amounts of cryptocurrency for daily use. You can use them with a single cryptocurrency or with several different cryptocurrencies.
Some examples of online wallets are:
- Fantasma
- MetaMask (Ethereum);
- Blue Wallet (Bitcoin).
Offline wallets
Offline wallets are external devices that keep your private keys away from any internet connection. They offer much greater protection and, analogously, are like safes for your cryptocurrencies.
Many of these hardware wallets nowadays are hybrid, offering an application that connects directly to the external device. This model allows transactions to be made via smartphone, but ensures that they can only be authorized by the device.
Some examples of offline wallets are:
- Trezor;
- Jade;
- Livro-razão.
How to choose the best wallet?
To choose the best wallet, first you have to know what you want: convenience or security.
If your goal is to use your cryptocurrencies in your daily life or store small amounts, online wallets are the best option. They are easy to use and free, which represents savings, especially if you are gradually buying your first cryptocurrencies.
But if you already have a higher amount invested and want to have more security, it's worth using an offline wallet. Although they are more expensive, they offer much greater security for your keys and protect your assets against theft and hacker attacks.
In addition, these wallets have cheaper versions that offer the same level of security in the long term. And we know that investing in cryptocurrencies is essential to avoid losses and thefts that can cause much greater damage.
Therefore, if your goal is to securely store your cryptocurrencies for the future, choosing this type of wallet is the best option.