How to choose the first crypto wallet

Buying cryptocurrencies is fast. Digital coins do not litter the apartment and do not ask for food, so once bought, they can be stored for decades. The main thing is to choose the right wallet. Well, if the quotes change sharply in a direction favorable to you, then the exchange USDT to ETH is available at any time.

How a cryptocurrency wallet works

First of all, a crypto wallet is not exactly the same as a cash wallet. Your funds actually "lie" in the blockchain, and the wallet is needed to confirm ownership of them and manage the account. In fact, these are two keys – public and private. The public key is the address of your wallet in the blockchain, it is used to identify your wallet to other users. The private key is known only to you, it is the password from the wallet, which gives the right to dispose of the coins that are stored in it.

If the private key is lost, it can be restored using a seed phrase of 12-24 words, which the owner writes down when creating a crypto wallet. But the loss of the seed phrase is already irreplaceable in any way.

Classification of cryptocurrency storages

The choice of storages for cryptocurrency is very rich. For ease of orientation, they are divided into different categories. First of all, these are cold and hot wallets.

Cold stores are those that do not have a permanent connection to the Internet. They are almost impossible to hack, but can be physically lost. However, as long as you have saved the seed phrase, this is not a disaster. Such storages are more suitable for hodlers.

Active traders prefer hot vaults that operate online. This is handy for quick transactions like selling AION to BNB, but not completely secure.

According to the degree of control over private keys, storages are divided into custodial and non-custodial. This is more relevant for hot wallets. If the key is kept by the user himself, the wallet is classified as non-custodial. With custodial storage, the key remains in the possession of a third party, such as a cryptocurrency exchange.

Another important parameter is the number of supported coins. Modern popular wallets are mostly multi-currency, they can store more than one asset. There are also monocurrency vaults, but they are used much less frequently.

How to choose a crypto wallet

When choosing a method of storing cryptocurrencies, you should focus on the following parameters:

• Safety. The most reliable way to protect your funds is to store them offline. Until the amount of investment in cryptocurrency reaches a critically significant amount, it is quite possible to get by with hot storage.
• Frequency of use of assets. For regular transactions, it is better to use a hot wallet. Those funds that you plan to store and accumulate are best transferred to cold storage mode.
• Diversity of the cryptocurrency portfolio. If you regularly use more than one cryptocurrency, you need a multi-currency vault.

Popular wallets

Trezor

Trezor is a cold hardware storage that supports a wide range of popular cryptocurrencies: Bitcoin, Ethereum, Litecoin, Dash, Zcash and ERC-20 tokens. To activate the wallet, you need to download the application on the official website and write down the seed phrase that will be needed to restore the wallet in case you lose access to it. In addition, the device can be used together with hot wallets. For financial security reasons, Trezor should only be purchased from official websites.

Ledger

Ledger is also a cold hardware storage that supports most cryptocurrencies. To activate the wallet, you need to download the special Ledger Live application and write down the seed phrase. There is also a mobile application for the Ledger Nano-X crypto wallet model.

Trust Wallet

It is a hot crypto vault available as a mobile app. It supports all blockchains and cryptocurrencies, as well as NFT tokens. To create a wallet, you need to download the application and write down a 12-word seed phrase. You can add the cryptocurrencies you need to the application menu. In addition, you can exchange cryptocurrencies without withdrawing them to third-party platforms.

Metamask

This popular hot storage is available as a browser extension or mobile app. Metamask can be integrated with many services related to the crypto industry and can be connected to Trezor and Ledger. It works with the Ethereum network and all its tokens, as well as with Binance Smart Chain, Polygon Network (Matic), Optimism Ethereum and other similar networks. In general, using Metamask is very similar to using Trust Wallet, except that it only works with a limited set of cryptocurrencies.