While you can trade Bitcoin on an exchange platform without having a wallet, the only safe way to hold Bitcoin is on your personal wallet. So before you start receiving or sending Bitcoin you have to buy or download your own personal Bitcoin Wallet.
As I mentioned in my other article “What is Bitcoin?”, there are 4 types of Bitcoin wallets: Cold Storage Wallet, Web Wallet, Software Wallet and Paper Wallet. Each of those wallets has different advantages and disadvantages. In the table below you can find basic but important comparison between all 4 of them.
|Type of Wallets||Security Rank||Ease of use||Losability|
|Cold Storage Wallet||Best||Third||Best|
- Cold Storage – its biggest strength is the security and “losability”, meaning it is harder to lose than other wallets.
- Web Wallet is the least secured one since you don’t “hold” your money. Think about it this way: you are leaving your money with a different company and they are not a bank.
- Software Wallet is not the best at any of the categories, but holding this type of wallet allows you to really hold your own money with you, which in my opinion is better.
- Paper Wallet holds last place in 2 categories but it is secure. The low score in “losability” is due to the fact that it is a physical paper document.
Each of those Wallets has multiple versions. Different companies make their own versions of them. In the upcoming articles I will review a few of each of those Bitcoin Wallets. I advise you to make a research if you are planning to store big amounts of Bitcoin.
Crpyto-Compare did a research about all the debit cards available to use with Bitcoin.
This post was first published on eCoin4dummies Website