Also known as a “hot wallet.” I’m sure you’ve guessed by now, and yes, in a nutshell, it is an app that stores your cryptocurrencies, Nfts, and other digital assets. It’s not a matter of ”will” you will ever get one. It is a matter of ”when.” I mean, take a look around. The world is going digital. Money is, so best believe your wallet is too. And as for life as we know it, for the most part, it already has. Our phones are an extension of us. So we’re pretty much eight tenths human and two tenths cyborg.
But that’s for a whole ‘another blog!
As for Crypto wallets, there are so many to choose from in your app store or play store. Like all things, they too come with pros and cons. Some have lower fees than others. Some have more functionality. Some are more trusted. Some have quicker transfer times between wallets. And some are more useful for specific coins.
Things To Consider When Choosing a Crypto Wallet
- Fees
- Functionality
- Transfer times
- What coins do they offer
These are all things you really need to consider when picking the best crypto wallet that suits you to maximize use and growth for your assets. You want to place your coins in a wallet that has the most potential for your coin to grow and be used. E.g., holding Ethereum in an Ethereum made wallet would be more beneficial than holding it in a wallet made by a competitor.
You want to be in an ecosystem of particular coins to thrive. For e.g., you wouldn’t expect to see cheap fees for Nike coins on an Adidas-owned Crypto wallet. They are competitors. So be mindful and DYOR (a crypto acronym for “do your own research”) before storing your coins in just any wallet.
Which Hot Wallets are the Best?
- Trust wallet
- Metamask
- Exodus
- Atomic wallet
Seed Phrase
Upon setup most wallets give you twelve words in a specific sequence known as a “seed phrase.” This twelve-word sequence is the only way you can access your wallet if you forget your password or if you wish
to import your wallet to a new device. Make sure to keep this written down in a safe place.
It is definitely an extremely good idea to make multiple written copies and stash them in places you know no one will find them but you. You can only rely on yourself, you have to secure your crypto as best you can because there’s no insurance, I mean, you don’t want to end up like Stefan Thomas. We’ll talk about him more soon.
Atomic Wallet Review
Some wallets require you to hold a certain number of coins that can never be withdrawn. I learned this hard lesson the difficult way when I tried to withdraw my entire balance of Polkadot (A form of cryptocurrency like
Bitcoin) balance in Atomic wallet.
Which allowed me to withdraw every coin except one. Now one doesn’t seem like much but when one Polkadot coin is worth $40 (at the time) you do feel a little cheated. By the way, one Polkadot coin is worth $72 at the time of writing this. That’s just sitting there! Unclaimable! Imagine if it were one Bitcoin!
Atomic Wallet Fees
The upside is the fees in Atomic wallet are very low. Whereas some wallets, like Trust wallet, let you withdraw the entirety of your balance, but they usually come with a heftier fee. Now if you’re going to repeatedly buy and hold coins over long periods of time, having a wallet with more expensive fees shouldn’t be a problem as you will only be making minimal withdrawals. But if you are looking to trade daily, your best option is obviously finding a wallet with cheap fees.
What Wallet Does Stefan Thomas Use?
Now, back to Stefan Thomas. He served as the Chief of Technology at Ripple (another cryptocurrency) for five years long before anyone even heard of the term “crypto”. He was getting paid in Bitcoin, which was only worth a few dollars back then. He has 7002 Bitcoins stored in an Iron key.
Stefan Thomas has had eight unsuccessful attempts so far. He did write his password down in two places but unfortunately lost them and now only has his memory to rely on for the last two attempts.
And Stefan Thomas isn’t the only one that has lost a fortune in Crypto because of this so I can’t stress enough how important, remembering your password and twelve-word seed phrase is!
Keep it safe!!
Approximately worth around $440 million at the time of writing this. I would surely be pulling my hair out if that were me. What is an Iron key you ask? It is a small encrypted offline device that is pretty much unhackable! (Yes, that’s a word… well, it is now!) You get ten attempts at your password, and if they are all failed, the contents on the drive will be erased forever.
What is a Cold Wallet?
If you fear being hacked and want more security to prevent that from happening. You can also purchase a Nano Ledger, or a “cold wallet”. Like an Iron key. A cold wallet is a small USB look a like thing, it’s an ”encrypted portable device” that allows you to download, store and carry your bitcoin and other cryptocurrencies. Kind of like a USB.
Cold wallets can cost as much as $100. It may seem like a lot but it is a small price to pay for extra security
and reassurance that your assets are safe. Unlike hot wallets, contents on a nano ledger are not stored on your laptop or phone. Which makes them less accessible and more secure.
Diversify Your Wallets For Safety
I myself have been investing little bits here and there for just over two years now. And when I started off, I started using Trust Wallet. I soon learned that diversifying your portfolio over multiple wallets is beneficial for various reasons I have already covered but it is recommended to use a variety of wallets to store your bitcoin or other cryptocurrencies.
You wouldn’t want all your cash in one house and that house to be burnt down. In this particular case, the house is a crypto wallet, and the fire is a hack or some other misfortunate event that could have your crypto portfolio being taken from you.
I would personally store coins that I would be planning to hold or “hodl” (a crypto term and acronym for “hold on for dear life”) for a long time in a cold storage wallet. And store cryptocurrencies that I will be trading and investing daily or weekly in a hot wallet.
Here’s a list of other articles I recommend on Bitcoin and Cryptocurrency:
- What is Bitcoin (BTC)?
- How to be a Bitcoin millionaire
- Is Bitcoin a good investment?
- How to swing trade cryptocurrency
- How to download a crypto wallet
- Which Hot Wallets are the Best?
Anyway, I hope you gained a better perspective on the growing world of cryptocurrency. It may seem big now but trust, we are ahead of the curve. Cryptocurrency is only beginning. This is by far the greatest financial opportunity we have ever seen.
Get in now and good luck to you on your Crypto journey!
