what are and which is better in 2022

Main

• To store bitcoin, a special application is used – a wallet. It allows you to create addresses on the Bitcoin blockchain, as well as receive and send transactions. Wallets may differ in functions and capabilities.
• Bitcoin wallets exist for a variety of platforms, including desktop and mobile devices. Bitcoin mobile wallets are the most popular solution for individual users.
• In addition to “hot” wallets, which require a network connection to work, there are also “cold” wallets – physical devices for storing the first cryptocurrency offline.

What are the types of bitcoin wallets

Applications for storing and transferring bitcoins are classified based on various criteria:

• Platform: PC (Windows, Mac OS, Linux) or phone (Android, iOS). In turn, desktop wallets are divided into “light” and “heavy”. The latter require the entire bitcoin registry to be stored on the device being used. One wallet can have an application for multiple platforms.
• “Hot” – the wallet works only when connected to the Internet, or “cold” – wallets in the form of a physical device that does not have to be connected to the network. Most wallets are hot.
• Custodial – a third party has access to the address and the bitcoins stored on it, or non-custodial – only its owner can manage the wallet and the funds on it. With custodial bitcoin wallets, an individual user mainly encounters only when using a centralized cryptocurrency exchange.

Mobile bitcoin wallets

Perhaps the most popular bitcoin wallet platform today is mobile devices. The vast majority of individual holders of the first cryptocurrency use them. Typically, each individual app can be installed on both Android-enabled and iOS-enabled devices.

In any mobile application, you can create an address for storing coins, receive and send transactions. At the same time, such wallets differ in settings and functions. For example, in addition to bitcoin, a wallet can support other cryptocurrencies or provide additional privacy options when sending a transfer.

Popular mobile bitcoin wallets in 2022:

1. Blockchain.com
2. mycelium;
3. exodus;
4. Trust Wallet;
5. Atomic Wallet;
6. electrum;
7. Coinomi;
8. Samourai Wallet.

The advantages of mobile wallets include the ability to access your bitcoins anywhere and at any time, a convenient user interface, and in some cases support for other cryptocurrencies and additional settings. In addition, mobile wallets often have a built-in function for generating a QR code for paying for goods and services with bitcoin.

At the same time, many mobile applications for storing cryptocurrency are owned by private companies, and their source code is closed. This means that the program may have a vulnerability or a backdoor that will allow access to users’ funds. However, the popular bitcoin wallets listed above have been around for years and have proven their reliability.

Bitcoin wallets for PC: what is the difference between “heavy” and “light”

It makes sense to use a desktop application for storing bitcoins if you plan to work with more or less significant amounts and the issue of security and safety of funds is of great importance to you.

There are two types of Bitcoin clients for PC: heavy (“thick”) and light. For the first to work, in addition to the wallet itself, you also need to download the entire blockchain. The light client accesses the blockchain through third-party services and therefore does not require downloading and storing it.

The advantage of a heavy wallet is that it also works as a full bitcoin node. Thus, its user can send transactions immediately to the network, bypassing intermediaries, which gives the maximum level of security. The disadvantages are the need to store on the device a bitcoin blockchain file larger than 500 GB (data for September 2022), to which another 5-10 GB is added every month. In addition, programming skills are required to work with the node software.

Heavy bitcoin wallets are used by miners, as well as application developers that send and receive a large number of transfers – for example, cryptocurrency exchanges, shops, etc.

The most famous of the “heavy” wallets is Bitcoin Core – the original client, written on the basis of the development of the creator of Bitcoin, Satoshi Nakamoto. Its source code is open and actively maintained by the community. You can download Bitcoin Core on the website project or bitcoin.org.

In addition to Bitcoin Core, there are other heavy bitcoin wallets:

1. Armory;
2. Bitcoin Knots;
3. Specter.

“Light” clients for PC are designed to make working with the Bitcoin network as fast and easy as possible, although they do not have the same level of security. Lightweight desktop bitcoin wallets include:

1. electrum;
2. exodus;
3. Sparrow;
4. wasabi.

Cold (hardware) wallets for bitcoin

The so-called cold wallets are, in fact, separate external devices connected to a computer or mobile gadget via USB or using a radio signal.

The main advantage of hardware bitcoin wallets is that they do not require an internet connection to work. You can connect cold storage to your computer once, transfer bitcoins to it and disconnect. After that, the cryptocurrency will be fully stored on the physical device. This almost completely eliminates the possibility of a hacker attack.

There are several major hardware wallet developers in the cryptocurrency market in 2022:

1. Ledger;
2. Trezor;
3. KeepKey;
4. ELLIPAL.

Hardware vaults are suitable for investors who keep their funds without movement for a long time. However, for those who use coins in active trading on online platforms, this type of wallet simply does not make sense.

Custodial bitcoin wallets

All Bitcoin wallets described above are non-custodial. This means that only their owner has access to the private key and funds. However, some applications use custodial bitcoin wallets.

The most common case of custodial storage of cryptocurrencies, which most users encounter, is the wallets of crypto exchanges and other similar services.

How to avoid becoming a victim of scammers when using a bitcoin wallet

In conclusion, a few tips that will be especially relevant for beginners.

• When creating a new bitcoin address, the wallet generates a unique public/private key pair that is used to sign transactions. The latter is intended only for the owner of the address, it cannot be transferred to anyone. The private key can be used to export an address with a balance from one wallet to another.
• Storing bitcoins on a centralized cryptocurrency exchange in a custodial wallet is primarily a matter of trust in the platform operator. If possible, we recommend withdrawing coins from the exchange to your own bitcoin wallet.
• Try to only download mobile wallets from official app stores such as Google Play (Android) and App Store (iOS). Before downloading, check the reviews and the number of downloads for the application.
• If you download the wallet from the site, make sure that this is the official site of the project. Fraudsters often create copies of popular wallet websites, the address of which has minimal differences from the official one.