Mining glossary
Wallet - what is it?

A wallet is software designed to store and manage cryptocurrency assets. In simple words, a crypto wallet is a storage facility for coins of different types, which contains all the data about all user transactions. Access to the software is carried out using special encrypted codes - public and private keys. The owner of the cryptocurrency that is stored in the wallet is the one who has the private key because all participants in the system conduct their activities without identity verification on conditions of confidentiality and anonymity.

Types of wallets

Before looking at the ratings of different types of wallets, you need to decide which type is better. According to the general classification, all cryptocurrency wallets are divided into 2 main groups:

  • hot;
  • cold.

The main difference is the connection type. Unique operating parameters - level of security, reliability, number of supported types of coins, functionality and interface, speed of transactions.

Hot wallets - types, features, and advantages

To use such a wallet, it must have a permanent connection to the Internet. However, there are different formats of hot wallets:

Web version. Such platforms are websites with a familiar interface. To enter your personal account, you must enter your login and password. You can log in from absolutely any digital device. The reliability level of such resources is quite low. Therefore, they are more often used for daily use and storing small amounts of cryptocurrency.

Special programs for installation on personal computers. When choosing, you need to consider what type of OS the software is intended for. The functionality of this version is more extensive, and the reliability is somewhat higher. However, there is always a risk of hacking by scammers. Therefore, backup access codes must be stored separately.

Mobile applications. Like the PC versions, these wallets are developed for different operating systems. Transactions are completed quickly, and the security level is individually configured, including setting up a two-factor verification mode using Face ID, PIN code, and fingerprint scan. The ideal option is to purchase a separate smartphone to install such software.

Cold wallets - features and benefits

Cold wallets are called crypto wallets, which are special hardware devices. In this case, access codes are stored on a piece of paper. You can purchase a similar option in the form of any information storage device. To connect, you must connect to a PC via USB or Bluetooth. Devices designed specifically for these purposes are not cheap - they cost 50 US dollars. However, they have a higher level of reliability and safety.

Which is better?

Considering the specifics of each option, we can conclude that hardware wallets are an ideal solution for the long-term storage of large cryptocurrency assets. Hot - suitable for daily use and a large number of transactions.