Cryptocurrencies are thought to be the future of payments, at least, these are the expectations of crypto enthusiasts. Being the future of currency and being a very profitable asset as it is the case with Bitcoin, Litecoin and many others, with Bitcoin on track to hit a new all-time high of $19,000, there should be a way the investors and holders do store their crypto wealth. Here are 5 different cryptocurrency wallet types withier advantages and disadvantages.
Different cryptocurrency wallet types
Hardware wallet: This is a fancier wallet option where the private keys and coins of a crypto owner can be stored. It comes with a screen and these type of wallets can be easily carried around. It is believed this form of a wallet is more secure than some other form of wallets such as desktop and mobile wallets because they are immune to viruses and hack attacks though they can fail to protect you from malware swaps and random number generator. Also, there have been recent cases of hardware wallet theft in the US. However, the more popular of such wallets include ledger Nano s and Trezor.
Mobile Wallet: These are another types wallets with the same physical attributes of a hardware wallet but functions more like an online wallet. This wallet type is at very high risk of virus and hacker attacks if not properly protected given their online accessibility. Notwithstanding, this form of a wallet is gaining increasing popularity given their ease of use than all another form of wallets. They also QR scanning options and be easily downloaded mostly for free from Google play store or Apple store. Some popular options include Jaxx and coinbase mobile versions.
Desktop Wallet: This form of wallet has similar functionality as the mobile wallets given their online connectivity but are not stored on any servers. They also have similar pitfalls such as hack and virus attacks (only in case private keys have been stored on third party websites). They are also risky in the case of a hard drive crash when the wallet is not backed up and could lead to information loss. They are for the most part free and some of such wallets include Jaxx.
Online Wallet: These are the most common forms of wallets given their easy accessibility, cheap cost and compatibility with laptops and mobiles as they only require internet connectivity to access them. They could also store several other coins depending on the wallet provider. For such wallets, you need a login username and password, and some provide two-factor authentication to improve security. An example of such wallet is Gatehub.
Paper wallet: This is thought to be one of the safest cryptocurrency wallet types currently available because it is 100% hack and virus free. With a paper wallet, the owner has a private key which he can transfer and store his funds. The only problem with a paper wallet is the fact that it cannot be retrieved if missing and needs to be kept safe because it only requires exposure of private keys to a robber or hacker either online or offline to lose coins.
Therefore, all wallets have their pros and cons but generally, Paper wallets seem to be the safest as the highest crypto theft in terms of number and dollar amount comes from cybercriminals (hackers).
What are your thoughts? which of the above cryptocurrency wallet types will you prefer to store your cryptocurrency in?
Let us know your thoughts in the comment section below.