An Ultimate Guide to Crypto Wallets

Introduction

Did you know there are 82 cryptocurrency wallets available today?

Crypto wallets support different cryptocurrencies, store public and private keys and enable users to send and receive digital currency.

With this, the interest in learning about crypto wallets is also increasing and businesses are curious to know about the consequences of their selection of particular crypto wallets. The choice of crypto wallets depends on the requirements of a person or an organization.

At the end of this blog post, I will be revealing the steps of crypto wallet development if you’re interested in investing in crypto wallets.             

 

 

Software crypto wallets have created the possibility of paying anyone anywhere in the world. It turns out to be much faster and more secure as compared to other traditional methods of paying. However, there are some requirements to make virtual transfers. For instance, a sender or receiver should have an internet connection. There are a limited number of transactions that could be made within a specific time. Also, all the information will be stored in a database that eliminates the anonymity of clients.

What are Crypto Wallets?

Crypto wallet software stores the public and private keys of the client and uses blockchain as a medium to send and receive money. The public key is used to send the crypto assets whereas the private key is used to unlock the crypto assets in the wallet. These keys generate an alphanumeric identifier called the address that specifies the location where coins can be sent. There is no physical exchange of money.

The currency in crypto wallets is stored in the form of cryptocurrencies such as bitcoin and Litecoin. The sender and receiver both have to create a crypto wallet to exchange money. The record of transactions is stored on the blockchain for transparency and security purposes. Besides this, the user gets access to view and monitor the transaction details and statistics such as the coin balance, the number of coins exchanged, and trade coins on the wallet.

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Types of Crypto Wallets

Crypto wallets are basically of two types i.e. hot and cold wallets. Hot wallets are the ones that are connected to the internet whereas cold wallets are not. Hot wallets can make transactions anytime whereas cold wallets need internet connectivity first.

Hot Wallets

• Desktop Wallets

Wallets are downloaded and installed on the PC. They can only be accessed from a single computer on which they are downloaded. They are highly secure however if the hacker gets access to your computer, your public and private keys could be compromised.

• Web Wallets

Also known as online/hosted/cloud/hot wallets, web wallets run on the cloud and can be accessed from any computing device from anywhere. They are called web wallets because they can be accessed through any internet-based browser such as Mozilla Firefox, Google Chrome, or IE. Moreover, they are called hosted wallets because bitcoins are stored on the servers of the company that you have chosen. Similarly, hot wallets are the ones that give 24/7 internet connectivity and where private keys are stored online. Hot wallets are vulnerable to various attacks that can steal your password or clone your computing device.

• Mobile Wallets

As the name suggests mobile wallets run on an app on your mobile phone. They can be accessed anytime from anywhere through a mobile device. They are highly secure with multi-signature access, two-factor authentication, and backup features. Mobile wallets do not keep cryptocurrency. However, the mnemonic in the app stores your private key using which you can unlock your mobile phone and see your digital assets.

Cold Wallets

• Hardware Storage Wallets

These wallets are different from software wallets as they store the private key of the user on a hardware device such as a hard drive or USB. The purpose of hardware storage wallets is to ensure enhanced security. The reason is that the private key is stored offline but the transaction is made online which gives an additional layer of security and eliminates the risk of the private key getting stolen. It is just like you are keeping the physical wallet with you.

• Paper Wallets

Paper wallets are printouts or physical copies of your public and private keys. Generally, cold wallets offer additional security but paper wallets are at a high risk of losing crypto assets when lost. Furthermore, paper wallets are time-consuming and have limitations when it comes to sending partial funds.

• Deep Cold Storage

It is a process that stores cryptocurrencies in cold wallets that are not connected to the internet. Moreover, the private keys are also generated offline.

 

 

Android-based Wallets

Android-based wallets allow you to store, send, and receive cryptocurrency from your android device. It stores the private key on your mobile device using which you can make transactions very easily. However, due to the constant connection of the mobile device to the internet, android-based wallets turn out to be more vulnerable to attacks.

Some examples of android-based wallets are below.

• Ethereum Wallet

Ethereum wallet is a gateway of the Ethereum blockchain for decentralized applications. It allows you to store, send, and receive ether as well as other Ethereum-based crypto assets. Also known as the Ethereum Mist Wallet, it is a feature built into the Ethereum platform. The Ethereum wallet is considered one of the most secure crypto wallets to store ether. It does not rely on any third-party software and has complete control over your private keys, passwords, and money.

You can interact with your Ethereum wallet in the following ways.

1. Smartphone applications where you can view and access your funds online from anywhere
2. Desktop applications when it comes to managing finds via Windows, macOS, or Linux
3. Browser extension wallets that you can access through browser applications
4. Web applications that you can access through browsers

• Enjin Wallet

Enjin Wallet is considered one of the most secure cryptocurrency wallets for android. It supports multiple cryptocurrencies such as ETH, BTC, ENJ, LTC, and all ERC-20 tokens. It has an intuitive interface with high-level security. Enjin Wallet allows you to take complete control of your private keys. You can restore the funds on any device using a 12-word recovery passphrase.

Some of the key security innovations of Enjin Wallet include

1. Double layer of encryption to protect confidential data and keystrokes. The upper layer employs software encryption while the lower layers use hardware 265 AES encryption
2. Secure keyboard to provide input protection and prevent data sniffing and keyloggers
3. Secure OS to prevent screen recording and screenshots

• Trust Wallet

Trust Wallet is an Ethereum wallet for mobile phones. It supports ERC20 and ERC223 tokens. It has a fully secured audited system to store, send and receive crypto assets. Trust Browser is a Web3 browser that allows interaction with decentralized apps (DApps). Trust Wallet has a fully optimized interface for mobile devices. It is a simple and secure connection between you, DApps, and Ethereum.

Some features of Trust Wallet include:

1. Store, send and receive and track your tokens including ETH, ETC, CLO, and 30,000+ ERC20 supported tokens such as OmiseGO, EOS, Augur, Bat, and more 
2. Peace of mind with a high level of security. Trust Wallet is tested and audited by a noble security organization to ensure data privacy and protection for the users
3. Complete control of digital assets and security of your private keys and funds

• Blockchain Wallet

Blockchain Wallet makes the use of bitcoin and ether simple. It secures your funds and allows you to exchange digital assets anytime from anywhere. Its high level of security gives peace of mind when it comes to making transactions and securing private keys.

Some of the salient features of Blockchain Wallet include

1. Enhanced security against any unauthorized access
2. Two-factor authentication to provide an extra layer of security to your account
3. Detailed security audits by experts
4. The facility of recovery with a 12-word passphrase
5. Support for 18 languages and over 20 currency conversion rates
6. Hierarchical deterministic address-based blockchain architecture

Security of Crypto Wallets

When it comes to storing money on a digital platform, security becomes very important. Crypto wallets are secure with different privacy and protection methods. It is the responsibility of a cryptocurrency wallet development company to protect the wallet from all possible threats and attacks. For instance, two-factor authentication (2FA) is the most common security mechanism to protect a wallet from unauthorized access. Other than this, it is recommended to place a very small amount of money in the wallet for everyday use and keep the other in a backup wallet. A backup wallet mitigates the risk of loss of entire money due to data theft or computer errors.

Fraudsters are always looking for loopholes in digital platforms. Therefore, crypto wallets are always encrypted with some strong cryptographic techniques and functions. Encryption is one of the best ways to secure funds online. You can also store your funds in cold wallets as they do not have any connection to the internet and your money will be free from any online fraudulent access.

Cryptocurrency Wallet Development

People have started investing in cryptocurrency projects and Crypto marketing after the phenomenal success of Bitcoin and Ethereum. Some of the cryptocurrencies have their crypto wallets. Traders interested in investing are looking for crypto wallets that are highly compatible with other cryptocurrencies.

Cryptocurrency wallet development involves the following steps.

1. Understanding of blockchains and cryptocurrency

2. Knowledge of cryptocurrency open-source libraries for development

3. Use of the right APIs

4. Selecting the right cloud platform for the app

5. Choosing the right technology stack

6. Implementation of high-level security

7. Code, design, and test

InvoBlox has a team of blockchain professionals to provide state-of-the-art cryptocurrency development services to businesses. If you are looking for crypto wallet development, we are here to help you with the best of our expertise and industrial needs. Let’s talk.