There are many different Bitcoin wallets available today to suit every individual and business need, but there are also several different types of Crypto Investors that you should be aware of. Some focus on privacy, some on security, and others on convenience and mobility. Let’s go over the basics of each types of bitcoin wallets to help you find the one that’s right for you.
- Desktop wallets
If you’re familiar with how e-mail works, a desktop wallet is like your e-mail application (e.g. Microsoft Outlook) and a bitcoin address is like your e-mail address. In order to receive bitcoins, it is a must that you share your bitcoin address with others.
However, if someone wants to send you bitcoins, they do not need to know your real identity or e-mail address because bitcoin addresses are pseudo-anonymous. Desktop wallets are good for non-network connected devices such as desktops or laptops. Another benefit of desktop wallets is that their private keys can be stored securely on the hard drive since many offer additional encryption features.
- Mobile wallets
For mobile users, desktop wallets can be inconvenient when it comes to payments. That’s why mobile wallets are ideal for individuals who need a wallet they can access 24/7 but still want to own their private keys. Mobile wallets have in-built security features like biometric authentication that make it easy for users to protect their money without having to carry around a hardware wallet. Read more about the Top 7 lucrative cryptocurrencies that deserve your attention.
Not only is the protection of private keys better on a mobile wallet, but they also allow you additional functionality like more payment options, faster fund transfer as well as potential access to merchants on different blockchains, provided by third-party apps built with blockchain support in mind. Plus, there are no extra fees involved when using your credit card via mobile or NFC apps.
- Web wallets
Also known as hosted wallets, these are wallets that exist only on a website. The wallet can be run from either your hard drive or their server, but neither you nor they have control over what happens to your bitcoin if something bad happens. For that particular reason, the use of web wallets is not at all recommended.
Here’s a list of things that could go wrong: One of their servers gets hacked; they get shut down by authorities; decide one day that they don’t like bitcoin anymore (which has happened before); etc… In general, if there is an opportunity for loss in storing your bitcoins with a third-party service provider there is no real reason to take it since you have better options at your disposal.
- Hardware wallets
Cold storage is one way to ensure your bitcoin investment remains safe. A hardware wallet will store your funds offline, where they’re more difficult for hackers to get at. Some wallets are dumb, which means they can be connected to any computer with internet access, but not used directly.
Which Bitcoin Wallet Is Right For You?
At the end of the day, choosing a wallet is one of the most important steps for those who are new to the Bitcoin investment world. Before you choose one, you should make sure that it is right for your needs and offers ample security features.
The different types may vary in terms of functionality, but they all have one thing in common: your private keys are fully under your control at all times. There’s no safety net if something goes wrong—but that also means you can take full responsibility for managing your bitcoin wealth. For a simplified trading experience, you can register yourself on the Bitcoin System App website. Here you need to fill in your personal information and register to trade. This is a safe platform, and also guides you while trading.