What is a Crypto Wallet?

What options are there, and how do they work?

November 15, 2021

What is a crypto wallet?

A crypto wallet is a unique digital account (usually an app or browser extension) which stores your digital assets, such as Bitcoin, in a secure place. In your wallet you can send and receive cryptoassets to/from other wallets.

A wallet is defined by its address, for example, all ERC20 tokens built on the Ethereum network have an address that is 42 characters long beginning with 0x, including numbers, upper-case and lower-case letters. Each address is unique.

Crypto wallets can be in hardware form too, such as the Trezor hardware wallet. Hardware wallets are basically small devices which only purpose is to hold your cryptocurrency, and are generally safer than an app, as app’s can be hacked if you’re not careful.

Before creating a wallet

Make sure you understand that security breaches can happen, and you can lose ALL your crypto if you are not careful. The main reason people have accounts hacked is because they store their seed phrase (a set of randomly generated words provided by the wallet) in an insecure location, like messaging it themselves on Facebook, some random note app, or taking a photo.

The seed phrase lets you recover your wallet if you sign in on a new device (e.g. you get a new phone and install your wallet app). So, make sure you write it down (on pen and paper) and store it somewhere safe, like a sock drawer, cookbook, side table, etc. Storing it online or on a device can be risky, because if someone hacks your account then all your crypto will be lost. There’s no bank to look after you or protect you, you’re on your own out here.

You might think hackers can’t get into your accounts, which (if you don’t have terrible security) is mostly true. However, you need to consider that hackers can intercept messages, emails, access your clipboard on your computer or device (through malware) and more if you’re not careful.

Which crypto wallet should I use?

This depends on what crypto tokens you are buying. If you’re looking for a quick and easy way to get started, try Binance as they have a built-in wallet and are beginner-friendly. If you want the option to buy more tokens (other than ones listed on the Binance Exchange) some other options are:

TrustWallet:

  • TrustWallet is one of the most common multi-chain wallets, only available as a mobile app
  • It allows you to trade shitcoins easily through PancakeSwap and other DApps (decentralized applications) which can be connected through the TrustWallet App.
  • It works across multiple chains (BSC, ETH, etc…)
  • Can store almost every single crypto token, old and new (this also can be a security risk, however, so be careful)
  • Download from https://trustwallet.com/

Exodus Wallet

  • Another very popular multi-asset wallet
  • Available in both an app and browser extension
  • Has built-in exchange (though can have high fees)
  • Has a nice design and user interface
  • Download from www.exodus.com/download/

Disclaimer

Nothing in this article or on this website is financial advice.