When you are buying crypto for the first time, you will need a wallet to help you secure it. Choosing the best crypto wallet is one of the most important things for any crypto newbie. Some factors you need to consider before choosing a wallet will be discussed in this guide.
What is a Crypto Wallet?
A crypto wallet or cryptocurrency wallet works like a traditional wallet but holds proof of digital cash, not paper currency. It stores the private and public keys required to buy crypto. Also, it provides a digital signature that authorizes each transaction.
A crypto wallet can be a program on an online website or app, a service offered by crypto exchanges, or a device. The private key that allows you to unlock your wallet must be kept safe and secure.
Choosing the Best Crypto Wallet
There are many cryptos wallets from which you can choose. Before choosing, you need to consider some factors. Some of these factors which you should consider before deciding on a crypto wallet are given below.
Knowing that a wallet is secured is important and must not be overlooked. Ensure that you check if the website has HTTP or HTTPS if it’s a web wallet. A website that has HTTPS on the web address is more secure.
Also, check to see if the wallet offers strong and secure logins. Two-factor authentication (2FA) is another thing you should consider. These are some of the security features you should look at before making a decision.
If anonymity matters to you, then you should choose a wallet that has the required features for it. Check to see if the details required for registration are minimal and not intrusive to your personal information. Also check if the wallet requires a user verification process.
Backing up your wallet
Backup capability is another factor you should consider before choosing a crypto wallet. Check to see if the wallet provider has a way of backing up data, and if the backup is encrypted. Also check if a backup restoration process is available and seamless to use.
Transparency is another thing you should consider when choosing a crypto wallet. Is the wallet provider transparent in their operations, and is the wallet code open source? Choose a wallet that is transparent about who they are and whose source code is up to date.
Before choosing a wallet, check to see if it offers a multisignature (multisig) option. Wallets that offer multisig options require more than one key before a transaction can be authorized. This makes such wallets more secure from theft and cyberattacks.
Owning your crypto
The wallet you should opt for should be one that allows you access to the private keys for the crypto in your wallet. Having access to your private keys keeps you in control of your crypto. It also enables you to backup your wallet independent of the wallet service.
The simplicity and ease of use of a crypto wallet are other things you should consider. Choose a crypto wallet that is simple and easy to use. Also, consider how you’ll be using your crypto. If you would like to use your crypto on a mobile device, a mobile wallet may be the best option for you.
Check to see if the crypto wallet is Hierarchical Deterministic (HD). User privacy increases with HD wallets as they always use new crypto addresses. Deterministic wallets are an added layer of protection for users.
When choosing a crypto wallet, make sure you take into consideration the factors mentioned above. Ultimately, the features you are after should determine the wallet you choose. Don’t forget that you can also use a variety of wallets for various purposes.