Anyone interested in buying and selling cryptocurrency has to use a wallet for the purpose. Your blockchain wallet operates much like the everyday leather billfold you keep in your back pocket, except that it shares some aspects in common with a modern digital bank account.
Cryptocurrency exists in a way wildly different than fiat currencies minted by government agencies. Since they have no physical form, your wallet doesn’t really “hold” any of your cryptocurrency – those transactions are recorded and encoded on the blockchain.
Instead, your blockchain wallet is a software application that gives you access to whatever assets you own on the blockchain. It is an interface through which you can store, send, and receive cryptocurrency.
So far, this sounds more like a bank account and less like a physical wallet. But there is no “bank” to speak of. There are only wallet addresses that link to certain sums and allow users to receive and withdraw funds using them.
There are many different blockchain wallet service providers out there, and finding the right one for you can be an intimidating challenge. This blockchain wallet review will gather and compare all of the best blockchain wallets available while detailing the benefits and drawbacks of each.
What Makes Blockchain Wallets Different From One Another?
One of the first questions that cryptocurrency newcomers often have concerns the multitude of different wallets out there. It’s easy to get confused between different wallet types, because it’s not often clear what distinguishes one wallet from another.
Every blockchain wallet lets you send cryptocurrency between certain addresses. But not every wallet supports every kind of cryptocurrency, and not all wallets enjoy the same robust security features.
All wallets use a public key and a private key to complete blockchain transactions.
One of the most important differences between various wallets is that some blockchain wallets don’t make you the sole owner of your private key. This means you don’t have full control over your wallet or the money it contains.
The most commonly cited reason for this is that regulators want cryptocurrency exchanges to know their customers. If a regulator wants an exchange to help track down a cryptocurrency user who is engaged in illegal activity, it wants to be able to access the corresponding wallet’s private key.
If you trust your wallet provider and avoid buying or selling illegal things, this is not a problem. However, it can become a problem if the cryptocurrency exchange in question is hacked. Cybercriminals love to target cryptocurrency exchanges for this exact reason.
Hot vs. Cold Wallets
There is another important aspect to keep in mind before jumping into our blockchain wallet review. You will see some wallets described as “hot” while others are “cold”.
If you plan on using cryptocurrency often, you will need to use a hot wallet. Imagine running to an ATM to pull cash out every time you want to use your bank account. Keeping your money handy is a huge convenience over having to plug a cold wallet into a device in order to use it.
If you are serious about investing in cryptocurrency long-term and don’t see yourself trading on exchanges very often, you should get a cold wallet. But beware – if you lose your cold wallet, you lose everything. There are no backups, no feasible recovery options, and no second chances.
If you’ve locked yourself out your house, forgotten your mobile phone in someone’s car, or lost your physical wallet anytime in the past few months, it is not recommended that you purchase a cold wallet. Remember that you’ll need to keep that single, unique device safe for years, possibly decades.
Five Basic Kinds of Blockchain Wallets
There is one final step before we start our blockchain wallet review with examples of real wallet options. Whether you are interested in starting a new wallet or need to switch over from an old one, it pays to keep the major types of wallet in mind:
The Blockchain Wallet Review: Today’s Best Cryptocurrency Wallets
Now that we’ve covered some of the most important information about choosing a wallet, we can move onto a categorized list of the best blockchain wallets reviewed by our team.
Coinbase is globally recognized as one of the largest and most secure cryptocurrency exchanges around. If you are new to cryptocurrencies and want a simple, easy-to-use web-based interface for buying and selling a variety of currencies, Coinbase is the best place to start.
Although Coinbase is a cryptocurrency exchange that exerts control over its users’ private keys, it has best-in-class security features for keeping customer accounts safe. Be aware that it does collect data on its users – you must verify your phone number, photo ID, and establish a purchasing history on the platform.
Edge is a Bitcoin-oriented wallet that nonetheless supports a broad range of other currencies. It is a mobile wallet and features no desktop or web-based functionality. This wallet uses client-side encryption to keep your private data secure on your mobile device – eliminating the need to pass on any private information to Edge’s servers.
Edge is highly secure, offering dual-factor authentication and advanced password recovery services. Users who purchase cryptocurrencies through Edge will need to pay a small 1-6% percent fee of their purchase’s total value.
TREZOR is a cold hardware wallet that comes in the form of an ultra-secure USB dongle. The team behind TREZOR designed it to offer maximum security in all circumstances – even when people use it with insecure devices.
The company built this device with a zero trust approach in mind. Every aspect of TREZOR is designed to complement its security benefits. Unlike many other hardware wallets, TREZOR does provide a recovery method for lost or stolen wallets – this recovery uses a 24-word code that you must recite in order to gain access to your funds.
MyEtherWallet is free, open-source, and dedicated to the Ethereum family of cryptocurrencies (ETH, ETC, EOS and ERC20). However, it offers an excellent user experience alongside best-in-class security and great support for supplementary hardware like the TREZOR wallet.
MyEtherWallet can be a little difficult to set up for non-technical users, but it offers excellent security benefits. MyEtherWallet does not store your password or private key, and even supports offline transactions. The company offers new users thorough documentation for getting used to its platform.
Home to 15 million individual wallets, Blockchain.info is a major player in the world of cryptocurrency wallets. It earned its place on our blockchain wallet review thanks to its advanced security features, compatibility, and intuitive user interface.
However, Blockchain.info requires users to pass through an extensive identity verification process in order to use its features, and limits its users’ transactions to Bitcoin and Ethereum. Additionally, you cannot purchase cryptocurrencies directly with fiat currencies through Blockchain.info.
Coinomi is the swiss army knife of blockchain wallets. If you want to dive into heavy, high-frequency trading between over hundreds of different blockchain assets, Coinomi is the way to go. This is a mobile blockchain wallet that offers a suitably high level of privacy and security for blockchain traders – the company claims that even if your phone is stolen, the thief will not be able to access your account.
One of the main drawbacks to Coinomi is that it is an Android-only mobile app. Additionally, while much of Coinomi is open-source, it has kept parts of its infrastructure private. This has led to speculation on users’ behalf – what is it that they want to hide?
7. Ledger Nano S
The Ledger Nano S is a highly secure cold hardware wallet that supports a wide range of cryptocurrencies. It offers secure wallet software integration with a variety of online and software wallets, and features a useful OLED display. As an additional benefit, it is more affordable than some of the other hardware wallets on the market today.
In fact, the Ledger Nano S is the cheapest hardware wallet on the market to feature an included OLED display. That display lets you quickly and easily double check every transaction you approve. It offers functionality nearly identical to that of the more reputable TREZOR, but at a significantly lower price.
Electrum is a Bitcoin-only desktop wallet that maximizes security and accessibility. It integrates well with TREZOR and the Ledger Nano S, making it an ideal solution for Bitcoin investors and traders who are not interested in buying or using other currencies.
Electrum earns its place on this blockchain wallet review because of its unique trade-off between security and accessibility. In order to offer a secure, streamlined experience to bitcoin traders, it focuses exclusively on a single cryptocurrency and offers no support for any others. The team behind Electrum claims that this allows them to optimize the efficiency of the platform for Bitcoin.
Which Blockchain Wallet Is Right for You?
Choosing the right solution for your cryptocurrency ambitions requires more than reading through a blockchain wallet review. Since security is key, you will have to look for recent news indicating whether any of the wallets mentioned have suffered any notable attacks or compromises.
Performing due diligence will ensure that your blockchain wallet solution is optimized to your lifestyle, security concerns, and cryptocurrency trading behavior. Keep your wallet safe and become part of the blockchain community today.