Crypto Wallets in 2021 (Best Wallets)
If you are still contemplating about the best crypto wallets in 2021 then you are welcome to codedportal, the best crypto wallets are essential for managing your cryptocurrency investment and here’s how to pick the right one for you.
Cryptocurrency storage can be complicated. But with this guide to the best crypto wallets, we hope to make it easier to understand.
Technically speaking, crypto wallets don’t actually store your funds — coins never leave the blockchain; they just get transferred from one “address” to another. Wallets create your public address so you can receive coins and securely store your private key so you can send coins.
Another fun fact: you don’t actually need a wallet to store your cryptocurrency, whether it’s Bitcoin, Ethereum, Dogecoin or any other of the top cryptocurrencies. Major crypto exchanges such as Coinbase, Binance, and Kraken allow you to store your holdings right there in the exchange. (Just like you hold your stock with your trading platform/broker) You can even buy and store some cryptocurrencies on Robinhood and PayPal. But for security and other reasons, you may want a separate “non-custodial” crypto wallet.
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The main thing that differentiates cryptocurrency from traditional currency is that it is decentralized, meaning no government or other entity controls it. And for that reason, you may want to take extra precautions against theft or loss of your crypto assets by taking control of its security yourself. That’s where the best crypto wallets come in.
Today’s crypto exchanges might be secure enough for the average person, but if you want to get serious about locking down your cryptocurrency, a wallet that is not owned or managed by any third party is the safest method of storage. You and you alone, have the private key to access your wallet. While it’s unlikely that a major crypto exchange will get compromised or dissolve, they are still relatively new businesses (compared to banks) and are frequently targeted by the bad kind of hackers.
Another reason people choose to store their cryptocurrency in a wallet is that wallets are required to make certain kinds of crypto transactions — e.g., interacting with blockchain apps to do things like buy and sell NFTs. That’s a bit advanced for this guide, but the bottom line is that if you have a large amount of money invested in crypto and/or you want to transact with, not just invest in, crypto, you’ll want one of the best crypto wallets.
EDITOR’S NOTE: This roundup does not constitute investment advice and you should be aware that buying cryptocurrency, like any investment, involves risk. We’d recommend never spending more than you can afford to lose.
Best crypto wallets: Hardware wallets vs. software wallets
The most important thing to know before choosing one of the best crypto wallets is that there are two main categories: hardware wallets and software wallets also referred to, respectively, as cold and hot.
Hardware (cold) wallets are physical electronic devices and have a cost to purchase; software wallets are free and make it more convenient to access your funds, but they are less secure because they are connected to the internet.
Think of hardware wallets like savings or investment accounts, and software (hot) wallets like the leather wallet you carry around in your purse or pants pocket — they’re not for holding your life savings in crypto, just what you may need or want to transact on a daily basis.
Within the software wallet category, there are three types of wallets: web, desktop, and mobile. Below we explain the similarities and differences between all four kinds of wallets and note our favorites of each, which of course will vary depending on personal preferences.
Best crypto wallets: Back. It. Up.
One final note that pertains to all crypto wallets: make sure you never, ever, misplace your recovery (aka “seed”) phrase, the string of random words that are the key to gain entry to your wallet. We’ve all heard the stories of would-be crypto fortunes lost because of forgotten passwords. While those days are pretty much behind us — the technical hoops you had to jump through to buy and store crypto in the early years were immensely complex compared to today — it is still a real possibility.
Since you and you alone are given your seed phrase — there’s no resetting this password — it is vital that you not lose it. As long as you have it, you should always be able to access your wallet. But don’t just hold onto your seed phrase: protect it as you would your coins, as anyone with the phrase can steal your crypto.
Best crypto wallets: Best hardware crypto wallet
Best crypto wallets — Ledger Nano X
A hardware wallet is a physical electronic device (they look like thumb drives) that contains your personal cryptocurrency private key and allows interaction with various blockchain networks. (Remember, every cryptocurrency has its own blockchain, or ledger, that keeps track of all transactions.) Most of the leading hardware wallets can support hundreds of different cryptocurrencies.
Hardware wallets connect to your computer through a USB port or Bluetooth (USB is the more secure method). These are the most secure crypto wallets because they are not connected to the internet.
One drawback to a hardware wallet is that since you’ll want to keep it in a safe place (e.g., a home safe or even a safety deposit box) and not connected to your computer or mobile device, it won’t be as readily available as a software wallet would be for making transactions. Hardware wallets are therefore best suited to the buy-and-hold crowd, those dealing with very large sums of crypto, and the ultra-paranoid.
What if you lose the device or forget your PIN code? Don’t worry — as long as you are using a hardware wallet from a respectable brand (Ledger and Trezor are the market leaders), your seed phrase will enable you to recover your PIN or transfer your funds to a new device.
Our recommendation: The Ledger Nano X is small, moderately priced ($119), and easy to setup and use. It features a Bluetooth connection to manage your crypto on the go and supports over 1,500 different crypto assets. For security it features a PIN code and 24-word recovery phrase.
Best crypto wallets: Best web crypto wallet
Best crypto wallets — Metamask
Like all software, or hot, wallets, a web wallet can be easily created and used instantly. As noted above, they’re great for frequently accessing your crypto funds. Of course, since it’s connected to the internet, what you gain in convenience with a web wallet, you lose in security.
Web wallets interact with cryptocurrency blockchains through a plug-in on your web browser. That might sound complicated, but a web wallet is actually the simplest type of crypto wallet there is. Once you’ve installed the browser extension, you don’t have to download or install anything in order to access your crypto funds and transact with them. And transacting can be more than just buying, selling, and trading different crypto tokens: leading web wallet MetaMask describes itself as “a bridge that allows you to visit the distributed web of tomorrow in your browser today.”
Our recommendation: The MetaMask extension wallet is a browser extension that lets you run Ethereum-enabled apps and websites — and securely store your Ether (ETH) and the hundreds of cryptos that are based on ETH tokens, including stablecoins and NFTs — on your regular old browser (e.g., Chrome, Safari, Firefox). It’s quick and easy to install and while not for total beginners, it has a fairly intuitive interface.
If you want to store Bitcoin, which can’t be used to transact with apps on the Ethereum network, this is not the web wallet for you. For Bitcoin holders, we recommend the Blockchain.com wallet, which has a clean look and makes it simple to send, request, swap, buy, and sell Bitcoin, Bitcoin Cash, and about 10 other cryptos. It also has a linked mobile app.
Best crypto wallets: Best desktop crypto wallet
Best crypto wallets — Exodus
A desktop wallet, as you might expect, is software that you download to your computer desktop. It’s more convenient for transacting than getting out a piece of hardware, but still less convenient than a web or mobile wallet (see below) that is already connected to the internet.
To use a desktop wallet, you launch the file and enter your password. Of course you should keep your password safe, but it is also recommended that you backup your wallet file in case your computer decides to stop working one day. Desktop wallets are good for the person who spends most of their time on a desktop or laptop computer and wants the peace of mind that their cryptocurrency access codes are being kept offline most of the time.
Our recommendation: Exodus Bitcoin & Crypto Wallet. Exodus is free and easy to install and has a user-friendly interface that even a crypto novice can navigate. Exodus supports over 100 different cryptocurrencies and has a reputation for having good customer support should you need it. Exodus also has a linked mobile app.
Best crypto wallets: Best mobile crypto wallet
Best crypto wallets — Coinbase Wallet
A mobile wallet is an app containing your cryptocurrency account information that can be downloaded and installed on a mobile device. Because mobile wallets allow you to send and receive cryptocurrencies by using QR codes, they’re great for transacting with cryptocurrency face to face, where possible, in the real world.
Mobile wallets are great for anyone who spends most of their screen time on a mobile device, and some people feel they are even more secure than web wallets as long as you’re running the latest versions of Android or iOS. Many web and desktop wallets also offer linked mobile wallets.
Our recommendation: Coinbase Wallet. Do not confuse the Coinbase Wallet with the Coinbase exchange — they are separate entities, and with the Coinbase Wallet you’re not trusting Coinbase with your crypto keys; you control your own keys. The Coinbase Wallet is a mobile crypto wallet with a host of features. It’s super easy to download and navigate; supports Bitcoin, Ethereum, and many other tokens; and provides you with access to the decentralized web.
We also recommend, for folks who only want to store Bitcoin and Bitcoin Cash, the Bitcoin.com wallet, for its speed and ease of use when transacting with those coins.
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