Choosing the right Bitcoin wallet has never been a simple process. Knowing the bitcoin wallet that is the right one for you will depend on several factors, including the type of Bitcoin investment that you plan to make, and what you plan to use it for, which makes it harder than you may think for somebody who is brand new to the world of crypto investing. To get started, it’s important to understand the different types of Bitcoin wallet and how they work.
Hot Wallets
A hot wallet is a Bitcoin wallet that is constantly connected to the internet. Hot wallets cover a range of different wallet types, including online options like this Bitcoin Wallet UK, software wallets, platform wallets, and mobile wallets. They are the ideal choice for traders who want to move around with their Bitcoin, offering very responsive trading, quick liquidity, and valuations. However, these wallets are often at a higher risk than others when it comes to hacking, so it’s not a good idea to use it as your main wallet.
Cold Wallets
On the other hand, a cold wallet is not always connected to the internet. These can be software wallets, hardware wallets, and paper wallets. While they are not constantly online like hot wallets, they may be connected sometimes. This wallet type is the best choice for storing a backup of your online wallet or keeping the majority of your Bitcoin investments stored securely. However, since the wallet is not always connected, it can sometimes take some time to get it connected and start spending your coins. Another downside is that, in the case of hardware or other physical wallets, if it’s lost, it is gone for good.
Most Popular Ways to Store Bitcoin:
- Hardware Wallets: These wallets are both physical and cold wallets, meaning that they stay offline until you say otherwise. As long as you are able to find a very safe physical space to store them, they are designed to provide investors with the highest security available for cryptocurrency. No serious Bitcoin or cryptocurrency investor would be without a hardware wallet.
- Mobile Wallets: Mobile wallets are usually online wallets that grant you access to your investments on either PC or mobile. They may come as part of a cryptocurrency trading or exchange platform, supporting various different digital currencies. Some mobile wallets allow you to store a key directly on your mobile device, so you can avoid losing your coin as a result of system failures or software malfunctions.
- Desktop or Software Wallet: This is one of the most preferred options for storing bitcoin. It’s usually safer compared to an online or mobile bitcoin wallet, while allowing you to easily access your Bitcoin stash directly from your device. The software is downloaded to your computer or laptop, where you can also store your private keys offline. Most desktop wallets can be accessed offline, allowing you to disconnect your computer from the internet to prevent hackers from accessing your private keys.
If you’re new to cryptocurrency and unsure what kind of wallet to use, use the above advice to help guide you.
