7 Best Bitcoin Wallets (2022 Updated)
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In this post we are going to cover:
Plus more… Read on to learn everything you need to know about Bitcoin wallets.
This guide is designed to teach you everything you need to know about Bitcoin wallets. Because there are many different reasons to use and own cryptocurrency, some wallets are good for some tasks (like trading) while others are better at other tasks (like saving), and each wallet offers tradeoffs. With this guide, you can find out which wallet is the best for you.
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Best Wallets in Each Category
Most Secure Wallet
Coldcard website
Coinkite Coldcard Mk 3
The coldcard has long been considered the absolute most secure hardware wallet on the market. With support only for Bitcoin and some really advanced security features, it really beats everyone else in terms of security.
That Being said, if you plan on holding other coins besides Bitcoin, this is not the wallet for you. You might opt for a Ledger Nano S or Nano X instead.
ColdCard Mk3
Released
2022
Price
$158
Screen
Yes
Storage
SD Card
Best Wallet on the go
Ledger website
Ledger’s Nano X
The Ledger Nano X is Ledger’s newest additiont to the nano family. Unlike its predecessor, it supports Bluetooth, which makes it great for making quick and secure transactions on the go.
It’s large internal memory is also fantastic for traders who want to hold lots of different coins.
Ledger Nano X
Released
2019
Price
$149
Screen
Yes
Storage
2MB
Best iOS (Hot) Wallet:
Hodl Wallet: A Simple Open-source Bitcoin Wallet
Hodlwallet website
Hodl Wallet is available for iOS and android and makes it easy to send and receive Bitcoin with no frills or extra features to distract you.
Best Android (Hot) Wallet:
Samourai – protects privacy on mobile
Samourai website
Fully non custodial software ensures you are always in control of your private keys. No email address, no ID checks, and no hassle. Just install and go.
The newest innovation from the Samourai developers is TxTenna, an app which utilizes the Gotenna Mesh radios to send transactions even when you are offline.
TxTenna.com’s Homepage
Best Desktop Wallet:
Wasabi – Ridiculously private desktop wallet
Wasabiwallet website
Wasabi wallet is designed to make privacy enhancing coinjoins easy (see how in our guide). This is an advanced wallet that beginners should try later when they are more experienced.
What is a Bitcoin and crypto wallet?
Before you can do anything on the bitcoin network, you will need a wallet.
While this is not a perfect analogy, for now, think of a wallet as similar to a bank account in that it holds your money and you can use it to send and receive funds.
Info: A wallet is comprised of several parts: a ‘public key’, a ‘private key’, and ‘addresses’.
What is a private key?
In short, the private key is like the password to your bank account. If someone else has it, they could login to your account and transfer themselves your money. You need to keep the private key even safer than your bank account password.
What is a public key?
The public key is a little more confusing because there isn’t a straightforward real world analogy, but to continue the illustration, it is sort of like your bank account username. You don’t really want others to know it, but if they did, they still don’t have your password so they can’t take your funds.
However, if your public key is known, it will affect your privacy going forward, which brings us to addresses.
What is a Bitcoin address?
Imagine someone wants to send money to your bank account. In that case, you would give them your bank account number and they could tell their bank to transfer you the funds.
A bitcoin address is like a bank account number. If someone wants to send you Bitcoin you send them an address.
However, unlike a bank account, your wallet has millions of addresses. Don’t worry, you don’t need to think about that too much.
Just suffice it to say that most wallets use your public key (plus some cryptographic magic) to generate a new address for every transaction. This is to protect your privacy by making it harder for someone to link previous transactions to the current one via a practice known as ‘chainalysis’.
In most cases, all you have to do is open your wallet and select ‘receive Bitcoin’ and give your friend the address shown on your wallet. All the hard stuff happens in the background.
Advice:
The most important thing to remember when it comes to Bitcoin wallets is the phrase “Not your (private) keys. Not your Bitcoin”. This basically means that if your Bitcoin is not in a wallet that only you know the private key to, it might as well not be your Bitcoin. In this way, Bitcoin is similar to cash; if your $20 bill is in my pocket, how can you really prove it’s not my $20 bill?
One example of storing coins in a wallet you do not control is when you put your coins into an exchange, like coinbase or binance. This is why we advise moving all your coins off of exchanges as soon as you can.
Why Do I need a wallet?
Aside from the reasons above, you need a bitcoin wallet because it is the only way to transact on the Bitcoin network without using a third party to do it for you. This is important because the whole point of Bitcoin is to control your own money.
Why?
Because the current financial system is designed to tell YOU how you can and cannot spend YOUR money.
Bitcoin is what we call ‘censorship-resistant’, which is a fancy way of saying your bank or the government can’t prevent you from spending your money how you want.
In Bitcoin, no one will be able to stop you from buying whatever you want from whomever you want.
That is…unless you store your coins on a regulated exchange.
Different types of wallets
You may be wondering, “What is the best wallet?” There is no “best” per se. However, as noted before, some are better suited to certain goals than others. Let’s run through the different types of wallets.
Hardware wallets
Hardware wallets are primarily used for long term storage of cryptocurrency. They are called ‘hardware wallets’ because they are actually a physical device that you store in the real world.
The two most popular hardware wallet brands are Ledger Nano X and the Trezor T.
All of these products may sound strange since Bitcoin is a digital currency.
“Why do I need a separate device to store a digital good like Bitcoin?”
Source –
Trezor Blog
The advantage of a hardware wallet is that it is designed with one goal in mind: to keep your Bitcoin secure.
Your phone or PC is designed to do many many other things, and these days, a lot (if not most) of those things require an internet connection.
Hardware wallets are specifically designed to keep your private key from ever being exposed to the internet. In fact, in most cases, the hardware wallet is intended to be powered off completely until you need to send or receive Bitcoins.
A hardware wallet is effectively a tiny air-gapped computer. The only information that ever touches the private key should be requests to sign off on transactions, and even then, you need to physically approve of the transaction by pressing a physical button. This means that even if you plug your hardware wallet into a computer infected with malware, the private key should remain safe.
More on this in the FAQ about the importance of choosing a hardware wallet with a screen.
Additionally, since the hardware wallet is designed to do only one thing (store coins), there are no other applications running that provide an attacker more opportunities to steal your coins. Ideally, all of the software and hardware that goes into a hardware wallet should be known and understood by the company that makes it.
Long story, short: if you own a decent amount of crypto, you should consider buying a hardware wallet. If you don’t, you are at serious risk of losing your coins.
Treat your hardware wallet as you would your bank account. This is where you store your life savings (or where you ‘hodl’). You aren’t going to store your daily spending money here.
Pros of Hardware Wallets
-
Best way to store your coins long term
-
Easy to set up
-
Easy to back up (more on this below)
-
Inexpensive insurance policy
-
Many exchanges supporting hardware wallets
Cons of Hardware Wallets
-
Harder to use than hot wallets
-
Cost money
Hot Wallets
Hot wallets are typically wallets that come in the form of an app on your phone.
We call them “hot wallets” because they are connected to the internet and usually used to store everyday spending money – “it’s hot and ready to go”, so to speak. This also means it is much less secure than a hardware wallet.
Because they run on your mobile device, hot wallets usually run in tandem with lots of other applications, like your GPS, internet browsers, and other services. Because of this, your mobile device is running code developed by hundreds (if not thousands) of different people from different countries and of different standards for security.
In light of this, there are many more surfaces of attack. After all, your private key is being stored somewhere in the local memory of your phone, and that local memory is shared with all of these other apps. In most cases, if you keep your private key safe, so will your app, but you should always assume your hot wallet is compromised and never keep too much Bitcoin in it at one time.
Long story, short: use your hot wallet as you would your regular cash wallet in your pocket. You aren’t going to store your life savings there, but you will store a few dollars in cash to get you through the week. Basically, only store enough coins in your hot wallet that it wouldn’t financially crush you if you lost it.
Pros of Hot Wallets
-
Free
-
Easy to send and receive coins
-
Can access funds from multiple devices
Cons of Hot Wallets
-
Always connected to the internet
-
Run parallel to other software
-
Not as secure as hardware wallets
-
Backups sometimes relatively weak
Desktop Wallets
Desktop wallets are another form of software (hot) wallet. However, instead of running on an app on a phone, they are a program you run on your desktop computer.
While you can run these wallets on an air-gapped computer, this requires a great deal of knowledge to pull off safely, so generally speaking, it’s best to think of desktop wallets similarly to hot wallets above, just on a different kind of device and usually supporting a few more advanced features.
Pros of Desktop Wallets
-
Desktop interface means a better UI
-
Increased features over a mobile wallet
Cons of Desktop Wallets
-
Easy to download a fraudulent version of the software and lost funds
-
Harder to use than all the other types of wallets on this list.
-
Not as secure as hardware wallets
-
Backups sometimes relatively weak
Paper Wallets
The purpose of a paper wallet is to put your private keys somewhere that is not electronic at all.
Even with a hardware wallet, the private key is on an electronic device that does talk to the internet.
Warning:
If the software on the wallet doesn’t work as intended or there is an exploit to the secure element we haven’t anticipated, you could lose your coins.
That being said, setting up a paper wallet correctly is full of pitfalls that are, for most users, more likely than a hardware wallet betraying them (especially when there are other methods to mitigating that risk).
Advice:
We advise you not to create paper wallets, as will most other experts in the field. Even for an advanced user, it is just too easy to make a mistake and lose all of your coins. This is why we recommend opting for a hardware wallet.
On top of this, these wallets are the absolute least secure if someone finds the paper.
Pros of Paper Wallets
-
When set up correctly, totally secure from online theft
Cons of Paper Wallets
-
Least secure wallet if someone finds the paper
-
Very hard to set up correctly
-
Tons of user error possible
-
Never know for sure you set it up correctly until its too late
What is the best Bitcoin wallet for me?
This all depends on what you plan on doing with your crypto.
Are you going to be investing in bitcoin for the long term? Then a hardware wallet is the right one for you.
Are you going to be doing a lot of trading? Then we’d recommend a Ledger Nano X. Because of its Bluetooth functionality, you can get the flexibility of a hot wallet with the security of hardware wallet.
Are you going to be spending day to day? Then we’d recommend a hot wallet – just don’t put too much Bitcoin on it at once.
As Demonstrated above, all wallet types have their own advantages and disadvantages, and it’s up to you to decide which one is best for your desired activities.
Most Popular Hardware wallets
Additional Info
Ledger Nano X
Price: $149
Short description: The Ledger Nano X is the latest iteration of the nano series of hardware wallets from Ledger. It features Bluetooth connectivity for connecting to smartphones and a larger OLED screen at a higher resolution than the nano s. This is the perfect wallet for Bitcoiners on the go.
Read our full Ledger Nano X review and check out the product page.
Ledger Nano S
Price: $59
Short description: The Ledger Nano S is a classic hardware wallet, being a favorite on the market with over 1.3 million units sold to date. You connect the device to the computer via USB and features a small OLED screen. The device also features a stainless steel sleeve, making the wallet nearly indistinguishable from a standard thumb drive – great for discreetly carrying it with you.
Read our full Ledger Nano S review and check out the product page.
Trezor T
Price: $159
Short description: Launched in 2018, Trezor’s model T is the newest addition to the Satoshi Labs’ brand of hardware wallets. It features a full color LCD touchscreen, double verification for transactions, and the ability to double as a hardware two-factor device, the Trezor T prioritizes security above all else.
Read our full Trezor T review and check out the product page.
Trezor One
Price: $59
Short description: Trezor is one of the first and most respected hardware wallets on the market. The Trezor One provides multiple layers of security for your coins and tokens. It features a screen with PIN protection, 24-word backup functionality, and two physical navigation buttons for confirming transactions.
Read our full Trezor One review and check out the product page.
Keepkey
Price: $49
Short description: Launched in 2015, the Keepkey features the largest OLED screen of any of the big 3 wallet manufacturers while also being the cheapest. It also sports an aluminum chassis, and is compatible with the shapeshift Exchange. Because of this, you can trade coins without giving custody of coins to shapeshift, though KYC is still required.
Read our full Keepkey review and check out the product page.
Coldcard Mark III
Price: $120
Short description: Coinkite’s Coldcard MarK 3 is considered by many to be the most secure hardware wallet on the market. It’s lack of altcoin support is disliked by some, but to Bitcoiners, this is seen as a feature rather than a bug. The Coldcard looks like a small calculator making it discreet and private. The device has a 128 x 64px OLED screen and a numpad with tactile buttons. Compatible with Electrum desktop app.
Check out Coldcard’s product page.
Bitbox 02
Price: $110
Short description: The BitBox02 is a hardware wallet designed by Shift Cryptosecurity, a Swiss company. The BitBox02 features a dual-chip approach: one acting as a secure element to prevent physical tampering and another acting as a general microcontroller to keep the software open source and verifiable.
Check out the product page.
Software Wallets (hot wallets)
iOS and iPhone Bitcoin Wallets:
Blockstream Green
Breadwallet
Dropbit
Mycelium
Android Bitcoin Wallets:
Blockstream Green
Breadwallet
Dropbit
Mycelium
Samourai Wallet
Desktop Bitcoin Wallets:
Electrum
Wasabi
Exchanges VS Wallets
Many exchanges have apps that look and act a lot like wallets, but they aren’t the same thing. Understanding the differences between a real wallet and an exchange app, like coinbase, is crucial to keeping your coins safe.
The differences really all come down to what we call “custodianship”. Put simply, this means: do you hold the keys to your coins or does someone else? Remember “Not your keys. Not your Bitcoin”?
Source – Coinbase wallet homepage
When you use Coinbase’s app to store your coins, you are not actually holding those coins yourself. Instead, you are trusting Coinbase to hold them for you. Is Coinbase likely to steal your coins from you? Probably not.
However, Coinbase is what we call in crypto circles a “honeypot”, meaning it is a very attractive place for hackers to try to break into. There are perhaps Billions of dollars worth of crypto deposited in Coinbase’s wallets.
Additionally, Coinbase may be directed by the Federal or state governments to freeze your accounts, especially if you are not a US citizen.
And finally, Coinbase is well known for having slow to indefinite withdrawal periods when the markets are going crazy. Sometimes this is because the servers are overloaded with spikes in traffic. Some people even think they do this on purpose to use your funds in the short term to make bets with your money.
All of these issues can be solved by holding your coins yourself. And Coinbase is just one example. In many ways, Coinbase is one of the safest exchanges you could hold your coins on, so all of the above scenarios are possible even more likely on other exchanges.
The important thing to know before deciding how you want to hold you coins is how each of these storage solutions work. Just because Coinbase has a send and receive function on their app that looks a lot like any other wallet, it is not the same as holding your coins yourself. When you send coins from Coinbase, you are merely asking Coinbase for permission to send those coins.
Wallet Backups
One feature of almost every wallet on the market is that you can make a backup in case something happens to it.
These days, we use what is called a ‘recovery phrase’ (or ‘recovery seed’). Here is how it works: when you create a new wallet, you will be prompted to write down a series of 12-24 words. They will seem completely random, but they actually come from a list known as BIP39.
If you ever lose your wallet because it is stolen or destroyed or you forget your PIN number (usually 4 digits), you can open a new wallet anywhere in the world and on any app or hardware wallet device and input these words. At that point, your funds will be restored.
This is achieved because the words correspond to your private key. The wallet runs the words you input through an algorithm and then outputs your private key (proof that you own the Bitcoin, essentially).
Because the recovery phrase acts as your private key, it means that you cannot show it to anyone. If someone has your recovery phrase, they could open a wallet of their own and then use it to take all your Bitcoin (or any other virtual currency).
How to Store Your Recovery Phrase
Most people just write down their phrase on a piece of paper, however this can be dangerous.
Imagine your house catches on fire or is flooded. If your phone or hardware wallet is ruined, you must rely on your recovery phrase to get your coins back. However, paper is hardly resistant to fire or water damage.
This is why many people who hold Bitcoin opt to use a Billfodl.
The Billfodl is a stainless steel device with no electronics of any kind. It is simply a metal chassis with slots in it, and it comes with a tray of stainless steel tiles with letters on them. You slide the tiles into the metal frame to spell out all of your 12 to 24 words and then hide the Billfodl somewhere no one will find it.
Now your backup is fireproof and waterproof.
Multisig
If you are feeling really advanced, and want to protect your coins to the maximum level, you can set up what is called a ‘multisig wallet’.
A multisig wallet is actually three wallets in one. In order to send coins from a multisig, you need to confirm the transaction from at least two (or in some cases, three) of the wallets.
In many cases, all three of these wallets are hardware wallets, but you could opt for a mixture of hardware and software wallets to achieve this.
Info:
Why would you set-up a multisig? Because it means that if one of your wallets is compromised, the attacker would still need at least one more to take your funds.
You might also make each wallet in your multisig a different brand. For instance, a Trezor, a Ledger, and a Coldcard. The idea here is that if a vulnerability is found in one of the wallets (say a Trezor, for example), and your attacker knows about this vulnerability, he still needs to find another vulnerability in either the Ledger or the Coldcard (or both, if you have set up a three-of-three multisig.
If this is something you want to try, we have written a guide for you here. You just need to buy 1 Ledger, 1 Trezor, and 1 Coldcard.
Prevent Theft
Let’s recap how we keep our coins safe:
First, you need to generate your own private key. Never let anyone else do this for you. It may sound complicated, but the wallets make it quite easy to do these days. And if you have any questions, you can always refer to our guides here on Privacy Pros.
Second, you need to keep your private key a total secret. Anyone who knows your private key has just as much of a claim to your Bitcoins as you do as far as the blockchain is concerned.
Remember: “Not your keys. Not your Bitcoin”. If someone else generates your keys for you or finds your keys or your recovery phrase, then they know your keys and can take your Bitcoin.
Third, you need to backup your private key. This is done by generating a recovery phrase when you set up your wallet (see the chapter on Backups above).
FAQ
Can’t I just store my coins on my exchange?
You can, but it is not recommended. Storing your coins on an exchange can lead to a loss of your coins. Just see what happened to Mt. Gox. It is better to keep your coins on a wallet that you own (meaning only you have the private key of) and then back it up using a Billfodl.
Can I encrypt my private key?
Yes! This is called passphrase protection. It works a little bit differently for every device so consult your wallet company for documentation. With that said, be very careful using this feature.
How do I get my Bitcoins back if I lost my private key?
If you have truly lost your private key, then you cannot get your bitcoins back.
Is it ok to keep my recovery phrase / recovery seed on my phone?
It is never a good idea to store your recovery phrase on any internet connected device.
What is a hardware wallet ?
A hardware wallet is a physical device which stores the user’s private keys.
Why do I need a hardware wallet?
A hardware wallet provides isolation between your private keys and your hackable computer or smartphone.
Why are display screens important for a hardware wallet?
Hardware wallet screens are not only for displays. Having a large screen also makes it easy to check the address before sending your coins.
What does Multisig mean?
A multisig wallet is actually three wallets in one. In order to authorize a Bitcoin transaction you need a confirmation from at least two of the wallets.
How do I protect my crypto wallet?
You need to generate your own private key, keep it a secret, and make a backup.
What is the safest way to store your recovery phrase?
The safest way to for storing your recovery phrase is on a stainless steel device with no electronics of any kind, such as the Billfodl. This will make your backup fireproof, waterproof and resistant to all natural disasters.
