For most of us who’ve been around the cryptocurrency space for a while, storing and accessing our cryptocurrencies was something new and different compared to storing our fiat money in our bank accounts.
And as an effort to simplify how cryptocurrency wallets worked, we tried to tell ourselves that in the world of crypto we should be our own banks. Meaning you store your cryptocurrency funds away in your own personal vaults. And you should be the only with access to those vaults through what is known as private keys.
That didn’t really work for more than the core enthusiast. With the rise of Bitcoin there was new interest in what these cryptocurrencies could offer. And these newcomers were finding it really hard to get their heads around this whole be your own bank thing.
It just seemed like too much work, when they thought they could as easily just leave them on an exchange. That was much easier, right?
Easier, yes! Safer, perhaps not.
We do have cryptocurrency exchanges where we can store our coins and tokens.
But there are considerable risks to it.
This has mainly been a concern due to the lack of security at some of these cryptocurrency exchanges, and also the lack of regulatory framework and instances to protect us and insure our funds.
That meant in the case of a hack or theft to a cryptocurrency exchange we were left with no clear way of retrieving our funds through insurances, or other means.
And then we’ve got the talented hackers that have focused on cryptocurrency exchanges over the years. As it’s been a very lucrative business for some. As the crypto world’s been plagued with several crypto hacks.
So, what should we do instead?
Well, get a safe hardware wallet of course. You will be doing yourself a favour.
You will also learn a lot more about how this new technology works. How cryptocurrencies and the wallet work will help you take advantage of all that this space has to offer. And I promise you it will be worth the money to buy one.
Before I head into my personal recommendation for hardware wallets, I thought I’d briefly explain how cryptocurrency wallets work. It’s not that complex if you understand the basic concept of a cryptocurrency wallet. If you are just planning on sending and receiving cryptos, then it’s mostly just common sense.
The cryptocurrency wallet keys
With cryptocurrency wallets, you have two types of keys. Private keys and public keys (learn more about the difference).
With the former being your secret code to enter your wallet. This should never be shared with anyone else. And for wallets where you have full control of your private keys and not sharing those then those are often referred to as non-custodial wallets.
And custodial wallets are exchanges or other wallet services where you don’t own your own private keys.
And then we have the public keys. And it is with the public keys that you can derive your wallet addresses from. And those addresses are what you can share with others so they can send cryptos to your wallet.
These are 20-45 long alphanumerical addresses. And each address is tied to a specific wallet. And a wallet can have more than one address at a time.
To send your Bitcoins to a friend’s wallet, you’d need a Bitcoin address that’s linked to his wallet.
You copy your friend’s wallet and then you go to your wallet, paste in the address and then send the Bitcoins (selected amount). That’s it. In general, it works like a normal bank transfer.
Remember that each cryptocurrency has its own type address. That means the addresses of Ethereum cryptocurrencies are different to Bitcoin addresses.
So, consider Bitcoin to be its own currency, with its own banking system. And within that system you can send BTCs to anyone with a BTC address. You can’t send ETH to a BTC wallet, and vice versa.
The three best crypto wallets
1 ) Ledger Nano X
The number one choice for me and the best hardware wallet on the market is the Ledger Nano X.
The Ledger Nano X is the latest model, the previous wallet is the Ledger Nano S.
And when it comes to securing your cryptocurrencies then there is no better choice than a hardware wallet. And for me, the Nano X tops the list.
With an upgraded Bluetooth feature added, additional storage space, and upgraded hardware and I feel that there is no better hardware wallet at this price ($120).
With the Nano X, you can download about 100 apps and keep them easily managed in Ledger Live or any of the other 3rd party apps that can integrate into it!
I’ve used the Ledger wallets originally so I’m a bit more used to them than the Trezor wallets. But the latter model T and One are other wallets I own also for research purposes.
2 ) Trezor Model T
The second choice on this list is the competing top model from Trezor, the Trezor Model T.
The Trezor wallets from SatoshiLabs were the first-ever hardware wallets to come on the market. And the Model T is the latest version following the Trezor One.
And sure when I am comparing the Model T vs Nano X then I can’t fault either. In fact, they are both very good and secure wallets that I would highly recommend to anyone.
The main difference is the price and that the Ledger device supports a bit more crypto assets than the Model T. And it is also cheaper. You can buy it for $60 less than the Model T ($180).
So for those two reasons I am going with Nano X as my top choice but Model T as a close second.
3 ) Ledger Nano S
And third on the list of best hardware wallets is the original model from Ledger Nano S.
And it is still today one of the most popular and bought hardware wallets.
Why? Well because it still does as good of a job in securing your cryptocurrencies. But it lacks Bluetooth and then the mobile device support. And it has a smaller storage space. So usually you can only download and have installed 3-5 apps at the same time on it.
But other than that, it still does a perfect job in securing your cryptos, you can use Ledger Live and a bunch of other 3rd party wallet apps.
So, when it comes to cryptocurrencies, I urge you to reconsider if you today store your cryptos on an exchange.
There are significant risks to it. And even with the promises of security through Binance’s SAFU fund or Coinbase insurance for cold storage, it still might not be enough. Learn more about the importance of a good and secure hardware wallet here.
I think that after buying any of these you will sleep better at night knowing that you have done your part on securing your cryptocurrencies in the best way possible.