October 7, 2021
As the popularity of crypto investment increases, so too do threats from malicious actors who want to steal people’s investments. It seems like not a day goes by without another story about cryptocurrency lost due to a hack or lost credentials.
This is why it’s paramount to keep your funds in an appropriate, secure wallet.
What is a cryptocurrency wallet?
Cryptocurrency wallets are a medium for storing cryptocurrency, accessed with a private key and/or seed phrase that the owner is responsible for storing. The key is what allows the user to sign transactions from their wallet.
There is a wide range of different types of cryptocurrency wallet, each with its own advantages and disadvantages.
A cold wallet is a cryptocurrency storage device that is not connected to the internet. Cold wallets are extremely secure and very difficult to attack, but are not as convenient to use and can be damaged, lost, and stolen.
Hardware wallets are physical devices invented to combat the vulnerabilities of online wallets by isolating assets from the dangers of the internet. They store data in chips that prevent data from being transferred in plaintext. Ledger, for example, has been certified by the French national cybersecurity agency. This hardware wallet is used by connecting it to its companion app on mobile or desktop via a cable. The more advanced version can also be connected to some cryptocurrency exchanges.
The Trezor hardware wallet protects against hackers, viruses, keyloggers, and offers a backup service that can restore all device content in case of loss or theft. Although it’s a cold storage device, it has mobile connectivity and can be used as a hot wallet for instant access to assets and passwords. It also has a screen, letting users visually verify and manually confirm all actions.
A hot wallet, or software wallet, is a digital currency wallet stored on a device that’s connected to the internet. Hot wallets are more suitable for investors who actively buy, send, and trade cryptocurrency and need to be able to easily access their funds from anywhere – hot wallets can be accessed via computer or phone. However, they are more vulnerable to hacks and loss of funds. Some exchanges will offer a hot wallet service as an alternative to keeping your crypto in the exchange.
Although hot wallets are more secure than keeping your coins in an exchange account, they are still more vulnerable to attacks. Price is also a consideration here — hot wallets are usually free, while hardware wallets generally cost from $50-$200.
Trust Wallet is a downloadable, open-source storage service. It allows them to store their private keys on their own devices rather than on the Trust Wallet servers. Access is backed up by a unique 12-word recovery phrase that the user must store. While users consider it easy to use, many also complain of poor customer service. Binance acquired the Trust Wallet in July 2018, making it the official wallet for the Binance DEX and Binance Chain.
My Ether Wallet
My Ether Wallet is a non-custodial Ethereum wallet with a mobile app, web platform, Chrome extension, explorer, and educational resources. It’s a free to use, open-source storage service with connections to additional services allowing users to swap between fiat and crypto.
CryptoWallet is an all-in-one solution with a wallet secured by BitGo. It comes with a built-in exchange that allows you to trade several high-cap cryptocurrencies, including Bitcoin. The wallet offers fiat support for pounds, dollars, and euros. You can even order your own crypto debit card and finally use Bitcoin for day to day purchases.
Coinbase is a major cryptocurrency exchange with its own mobile wallet. It’s popular because it lets users exchange fiat currencies for Bitcoin and other cryptocurrencies. The wallet is easy to use and offers security options, but it charges withdrawal fees when users want to move their funds out of the exchange. Users don’t control their private keys with Coinbase, as it’s a custodial solution, and purists prefer to “own” their keys rather than entrust them to a custodian.
A Bitcoin Core wallet is software that runs the full Bitcoin blockchain and includes a digital wallet for storing and transacting in Bitcoin. Users can also contribute to the operation of the Bitcoin blockchain by validating transactions. It is a very secure wallet, but has fewer features than standalone apps.
Connect your wallet
There is no perfect solution for storing cryptocurrency because the nature of the medium is that responsibility is in the hands of the owner. In addition, making transfers is fraught with issues – if you paste the wrong destination address by mistake or by fraud, there is usually no recourse for lost funds. Kirobo’s Undo Button solves this issue by requiring the sender to set a password that the recipient must enter in order to collect sent funds – and if they can’t, the sender can retrieve their payment. The Undo Button can be used with all major ERC-20-compatible wallets – connect yours to the Kirobo platform and try it out!