Suppose this is your first time hearing about cryptocurrency wallets. In that case, you can think of them as software programs that store your private and public keys while also interacting with numerous blockchains to allow users to send and receive digital currency and track their currency balance.
Those seeking to enter the fascinating crypto world by selling, buying, and trading any of the cryptocurrencies currently available, will need to have a digital wallet to perform these online trading activities. So, to make it a bit easier for anybody at the beginning of their crypto career or hobby, we’ve decided to create this beginner’s guide to cryptocurrency wallets.
What is a cryptocurrency wallet?
Millions of users are already using cryptocurrency wallets. Still, there is a lot of confusion when answering the question ‘What do I need to know about my cryptocurrency wallet’? Unlike traditional wallets, a crypto wallet doesn’t store any currency; instead, we have records of transactions stored on the blockchain.
As already said, crypto wallets are software programs storing public and private keys and interfacing with many blockchains so users can trade their online currencies. For instance, if a person sends you a Bitcoin, Ethereum, or any other cryptocurrency, they sign off their coin ownership to your wallet.
Ethereum wallets
With Ethereum wallets, users can interact with their Ethereum accounts. Ethereum wallets can be seen as a version of the internet banking app, only without the bank. Best Ethereum classic wallets allow you to check your balance, send transactions, and integrate it with other applications you are using.
Anyone looking to send funds or manage their Ethereum coins will need to get an Ethereum wallet. The good thing about them is that you can use different wallet providers, and you don’t have to have specifically an Ethereum wallet to manage Ethereum.
Bitcoin wallets
There are more Bitcoin wallets than Ethereum ones, and that’s only because Bitcoin was the first cryptocurrency introduced to the world. The numerous Bitcoin wallets will make it easy to store and manage your cryptocurrencies securely. There are so many options currently on the market, and it might be best to review some of them and compare them to see which fits your needs the best.
Here are some of the Bitcoin wallet options you should review if you’re looking to buy, sell, and trade your Bitcoins:
- Exodus,
- Electrum,
- Mycelium,
- Ledger Nano X,
- Ledger Nano S,
- Trezor Model T
Transaction fees with cryptocurrency wallets
Most people are curious to hear whether the transaction fees with crypto wallets are the same as with conventional bank fees. The short answer is – no. With cryptocurrency wallets, you can expect to pay significantly lower transactions fees, and the amount differs from one wallet type to another. For instance, some will ask you to pay for specific transaction types, while others will not have any fees at all. With some crypto wallets, you can even set your fees, but keep in mind that the lower the price, the lower the priority of the transaction.
In cases where you need to ensure your transaction is finalized and confirmed, you should aim for a higher fee amount. However, when compared to all the benefits having a digital wallet provides you with, transaction fees are something you shouldn’t worry about at all.
Anonymity
Another concern users of digital wallets might have whether they are anonymous. The answer is a bit tricky. Cryptocurrency wallets are pseudonymous, not tied to a particular user identity, but transactions are stored publicly and permanently on the blockchain.
You don’t have to worry about having your name or personal street address tied to it, but your wallet address could be quickly traced back to your identity. There is still much room for improvement when talking about having anonymous digital wallets, but that doesn’t make them unsafe or vulnerable to cyber threats.
In final words
If you’re serious about getting your first crypto wallet, make sure you weigh well all the options. Businesses or individuals seeking to create cryptocurrency exchange should do their research first to determine the best way to do it, as it’s pretty difficult to correct your errors in a field like this. Whichever the reason for your interest in the crypto world is, make sure you make the most of it.
