Remember the vaults of Gringotts Bank from Harry Potter? Crypto wallets are arguably even more secure than those vaults! However, their features determine how secure they’d be for your assets.

Depending on your requirements and preferences, you can choose from an array of hot and cold crypto wallets. This article will discuss the best crypto wallets, their pros and cons, and how to choose the best fit.

What This Article Covers:

• Best Crypto Wallets
  • Coinbase Wallet
  • Exodus
  • Crypto.com DeFi Wallet
  • Trust
  • Ledger
  • Trezor
• What Is a Crypto Wallet?
• How Does It Work?
• Types
• How to Setup a Wallet
• How To Choose the Right Wallet
• FAQs
• Final Words

Best Crypto Wallets — Our Top Picks

Before looking at the top results, you need to decide whether a hot wallet or a cold wallet is suitable for your needs. Here are some of the differences between the two:

• Hot Wallets are crypto wallets connected to the internet. They typically store cryptocurrencies and digital assets that are frequently accessed and traded. These are mostly free-to-use and allow you to conduct transactions easily. However, due to their dependence on the internet, they can be vulnerable to cyberattacks.
• Cold Wallets do not connect to the internet. They store cryptocurrencies offline and are generally expensive. They offer excellent security against cyber threats due to offline transactions. However, these transactions can be arduous as you’ll have to buy hardware devices like USB drives to store crypto. If you lose a device, recovery can also be difficult. Additionally, these devices aren’t suitable for daily or frequent transactions.

We’ve combed through a long list of hot and cold wallets to determine which are the best crypto wallets in their respective categories. Here’s what we found:

Top 4 Hot Wallets

Coinbase Wallet — Best for Beginners

Coinbase is one of the largest crypto exchange companies in the U.S. Its hot wallet product, known as Coinbase wallet, is a free-of-cost decentralized application (dApp) that allows users to store cryptocurrency. It supports thousands of cryptocurrencies, including Bitcoin, Polygon, Litecoin, Dogecoin, Ripple, Solana, Stellar Lumens and Ethereum.

Its user-friendly interface, integrations with decentralized applications and Coinbase exchange’s backing for easy transactions make it an excellent choice for beginners. You can easily download it from your Android or iOS applications store.

Unlike the exchange, the wallet is self-custodial, which means you can store the currency in your device rather than the company’s custody.

The wallet can integrate with other decentralized crypto exchanges such as 1INCH, SushiSwap, UniSwap and more. You can also connect it with a cold wallet Ledger to use offline storage features.

Pros

• It consists of a user-friendly interface.
• It supports thousands of crypto assets.
• You get robust authentication modules for added security.
• The wallet includes the backing of a reputed and credible exchange platform.
• It supports several decentralized exchanges (DEX).
• Provides recovery of lost or stolen assets.

Cons

• Coinbase supports Bitcoin only through the mobile app.
• It’s vulnerable to cyberattacks due to online infrastructure.

Exodus — Best User Interface

Exodus is a free cryptocurrency wallet for desktops and smartphones (Android and iOS). It has a visually brilliant UI and an intuitive UX design, making it extremely easy to use, even for beginners.

It supports over 150 cryptocurrencies (including XRP, Litecoin, Cardano, Binance Coin, etc.), has a built-in exchange, supports crypto staking and provides access to DeFi projects.

Exodus leverages simple payment verification (SPV) and acts as a light client to process transactions quickly and securely. You can set up custom transaction fees, but only for Bitcoin and Ethereum networks — it does not yet support custom fees for altcoin transactions.

The app neither collects any personal data nor requires a KYC verification for signing up. Integration with Trezor hard wallet can further upgrade its already formidable security features if you ever feel the need. And the best part is that the Exodus team provides 24/7 customer support.

Pros

• It can recoup stolen assets.
• Exodus offers a user-friendly interface and an excellent customer experience.
• It’s compatible with Trezor.24*7 customer support.
• It provides staking for Algorand, Ontology, Cosmos and Tezos.

Cons

• It doesn’t support external crypto exchanges.
• The in-wallet crypto exchange transaction fee is high.
• Exodus doesn’t offer multi-signature support.

Crypto.Com Defi Wallet — Best DeFi Wallet

Crypto.com is another leading crypto exchange platform that offers a non-custodial DeFi (Decentralized Finance) crypto wallet, Crypto.com DeFi wallet. It’s one of the best DeFI wallets and is completely free.

The wallet includes biometric authentication, password verification and two-factor authentication for enhanced security. You can also avail of staking rewards on currencies like Ethereum and rebates on a crypto exchange. You can simply download the app on your smartphone and set it up to access all its features without creating an account on the Crypto.com exchange.

Its desktop version can also integrate with Ledger hardware wallets. Remember that decentralized wallets, however convenient for daily transactions, are subject to market risks. If you’re investing in such platforms, make sure you go through user reviews to understand the nitty-gritty of the product.

Pros

• It offers rebates on more than 25 cryptos.
• The wallet supports 250+ cryptocurrencies.
• It can store decentralized finance assets along with crypto.

Cons

• The recovery phase is difficult.
• It doesn’t have phone support.

Trust — Best Mobile Wallet

Trust is a crypto storage wallet backed by an international digital asset company called Binance. It supports more than 10 million types of digital assets. Its partnership with Binance allows you to buy or sell digital assets directly from the wallet through your smartphone.

It offers staking support and is completely free of cost. It’s also a non-custodial wallet that allows you to store your assets on your device.

Trust’s built-in web3 browser allows you to access blockchain games and dApps directly from your mobile device. It’s one of the very few hot wallets with fully open-source infrastructure. You can also integrate it with the Ledger hardware wallet via a browser extension to access offline features.

Pros

• It supports 70 blockchain security models, including Bitcoin, Litecoin and Solana.
• Its user-friendly mobile interface is an added advantage.
• It offers interest and rebates on more than 10 different cryptocurrencies.
• The wallet contains built-in web3.

Cons

• It has limited training resources.
• The parent company, Binance, committed regulatory violations in the U.S.

Top 2 Cold Wallets

Ledger — Most Secure Hardware Wallet

Ledger is one of the oldest and most popular cold wallets. It comes in two variants: Ledger Nano S and Ledger Nano X.

It supports over 1500 cryptocurrencies and delivers state-of-the-art security measures via the Secure Element chip. You can use the Ledger Live app to manage crypto assets, send and receive cryptocurrency, stake your coins and browse DeFi platforms. The Ledger team has personnel trained in multiple languages and offers 24/7 customer support across the globe.

The device looks and works like a USB drive; you can connect it to your desktop or link it to your phone via Bluetooth (only for Ledger Nano X). It stores your private keys and secures them with a PIN, making it all the more difficult for hackers to access your keys.

It’s the most secure crypto wallet out there, and its two variants offer a lucrative price-to-performance ratio to appeal to beginners and enthusiasts.

Like with all cold wallets, we recommend you buy Ledger directly from the source and not third-party sellers to avoid any possibility of tampering with your device.

Pros

• It supports around 50 different hardware wallets.
• The platform offers staking for various cryptocurrencies.
• It provides interest and rebates on over 10 different cryptocurrencies.
• The wallet contains built-in web3.

Cons

• It’s a bit expensive compared to its base model.
• It doesn’t have an open-source custom operating system.
• Ledger offers limited customer support.

Trezor — Most User-Friendly Cold Wallet

There are a lot of similarities between Trezor and Ledger: they both offer two variants and different price points, provide bank-grade security and support over 1000 cryptocurrencies. While the UI feels more intuitive to use than Ledger, it’s a bit more expensive. It doesn’t support staking, but you can integrate with third-party staking wallets to stake your crypto.

All in all, the Trezor wallet packs quite a punch. It offers state-of-the-art security and an intuitive interface, along with all the additional services people have come to expect from a crypto wallet. In case you lose your wallet, recovery using the recovery seed is speedy and straightforward, making it hassle-free for both beginners and veterans.

While the desktop app supports Windows, Apple and Linux operating systems, the phone app has no iOS support as of yet.

Pros

• It supports several crypto exchange platforms.
• It’s compatible with various cryptocurrencies and digital assets.
• Its intuitive and simple interface makes the experience easier for users.

Cons

• It’s expensive compared to other products in this segment.
• No support for iOS devices.
• It doesn’t support Tron, Solana and Polkadot.

What Is a Crypto Wallet?

A crypto wallet is a software program, hardware device or service that allows users to store their public and private keys necessary to interact with a blockchain network and conduct crypto transactions.

Though crypto wallets sound like a place where you store your cryptocurrencies, that’s not the case. Think of them as a storage for your identity card with which you can access your transaction history and execute trades.

The key difference between a crypto exchange and a wallet is that only users with private keys can execute transactions in the latter. Most crypto wallets are non-custodial — anyone with access to your private keys can access your crypto assets. Most crypto wallets offer access to popular cryptocurrencies and stablecoins. However, if you’re more interested in altcoins, look for crypto wallets with access to those particular assets.

Some popular types include mobile wallets, desktop wallets, hardware wallets, web wallets and paper wallets. They offer distinct levels of security and accessibility. Each type comes with its own advantages and disadvantages, making them suitable for different users based on their requirements.

How Does It Work?

A crypto wallet allows you to store public and private keys securely.

Public Keys are codes consisting of numbers and letters that the crypto wallet provider generates. Think of it as your bank account number. It’s visible to the public and can fetch your crypto balance without compromising your account’s security.

Private Keys are also similar codes but known exclusively to you, the owner of the wallet. You can think of it as your bank’s online account password. With these keys, you can access and interact with your digital assets and cryptocurrencies.

Types

There are several types of cryptocurrency wallets available, each offering different features and levels of security.

Hardware Wallets

When it comes to security, hardware wallets are the gold standard. You can use them to store your private keys. They resemble USB drives in terms of looks, interface and connectivity. Connect them to a computer to carry out crypto transactions.

Hardware wallets are completely offline till you connect them to a computer for whatever reason. They are considered more secure than software wallets — with physical damage and accidental misplacement being the most significant threats. As a rule of thumb, you should buy hardware wallets directly from the source and not via third-party sources to rule out any chance of tampering.

Software Wallets

These are usually hot wallets, either provided as a service by cryptocurrency exchanges or as a standalone application for your computer or smartphone.

They are significantly more accessible and user-friendly than hardware wallets and come with various additional benefits, including staking, access to Dapps and direct cryptocurrency transactions.

However, at the risk of sounding like a broken record, we must remind you once again that a 21/7 connection to the internet comes with its own risks and challenges.

Paper Wallets

A paper wallet is an old-school form of cold wallet where you print or type your private keys on a piece of paper and put them in secure storage. However, they are even more liable to being lost, and the paper itself can get damaged. Their popularity has gradually waned in the face of more secure and accessible alternatives.

How to Setup a Crypto Wallet

Downloading and setting up crypto wallets is generally a straightforward and user-friendly task. However, the process varies for different types of wallets. Here, we’ll discuss how to set up hot and cold wallets:

Hot Wallets

Step 1: Download the wallet from the app store. Make sure you’re downloading the original product from a credible application store. With the surge in crypto scams, choosing a product affiliated with a reputable exchange company provides an added layer of security and reliability.

Step 2: Sign in and generate keys to access your account. Upon downloading and setting up your account, a non-custodial wallet will generate a private key. Remember, if you lose the key, you’ll not be able to access your account anymore.

Step 3: Add security features like two-factor authentication, biometric lock and other biometric security tools. If you’re using a custodial wallet, you’ll have to undergo a KYC verification process.

Step 4: Add funds to your wallet. You can buy crypto either directly with fiat money or transfer it from different wallets.

Cold Wallets

Step 1: Purchase the wallet hardware from an eCommerce platform or a local store. We recommend you buy it from reputable places to avoid scams.

Step 2: Download and install the software associated with the hardware. Download the software from the company’s official website. Follow the instructions to set up your hardware.

Step 3: Add crypto to your hardware wallet by transferring them from other wallets. Some wallets only allow you to buy or sell crypto when it’s connected to your computer or smartphone.

How To Choose the Right Wallet

There are no “right” crypto wallets. Depending on your requirements and budget, there can be multiple candidates — beginner-friendly crypto wallets, wallets good for Bitcoin, those equipped with mobile-friendly apps and wallets that provide access to the best DeFi projects. Whichever serves your needs is the ideal option for you.

FAQs

What is a seed phrase?

A seed phrase is your crypto wallet’s recovery phrase. It usually consists of 12-24 randomly generated words that act as a master key to your crypto wallet. If you lose or damage your crypto wallet, you can use this seed phrase to restore it, intact with all your assets.

The wallet generates this phrase when you are initially setting it up. We cannot stress enough the importance of keeping your seed phrase in a safe and secure location. Anyone with access to your seed phrase will have access to your crypto wallet in its entirety.

Is it compulsory to have a hardware wallet?

No, it’s not compulsory to have hardware wallets. They are the safest option for storing your crypto because they stay offline most of the time. Hot wallets can access the blockchain because they are connected to the internet, making them more vulnerable to external threats. But all wallets can store your private keys — you should choose one that’s suitable for you and fits your needs.

How much does a crypto wallet cost?

A hardware wallet can cost anywhere from $100 to $200. When it comes to software wallets, there are both paid and free options for you to choose from. You should pick one that can provide the services you need within your budget.

How can you cash out a crypto wallet?

You can either sell your assets on the blockchain or connect your wallet to an exchange and take advantage of their services for a small fee. Once you’ve successfully exchanged your crypto assets for fiat money, you can follow the exchange’s guidelines to transfer it to your bank account.

Final Words

While these are the “best” crypto wallets we’ve seen so far, there’s no guarantee that they’ll be the best for you. Always keep in mind that the right crypto wallet will support the coins you need to store, fit your budget, provide all the necessary features you need and meet your security standards.

At the end of the day, it won’t matter what crypto wallet you use if you aren’t careful. Some no-brainer best practices include keeping your seed phrases safe, smartphones and desktops malware-free and crypto assets a secret. No amount of encryption can save you if there’s a gun to your head.

Which crypto wallet did you decide to go with? How was your experience? Let us know in the comments!