The Bitcoin revolution has undoubtedly shaken the world. I had never seen anything like it before – a digital currency with no physical form. Due to this, a brand-new type of storage was required – crypto wallets.
An investment journey begins with the creation of a digital wallet, and “how to create a Bitcoin wallet” is often the first query many budding crypto enthusiasts perform on Google. Despite this, many people are still confused about the whole concept of crypto wallets and are therefore reluctant to become involved in cryptocurrency due to the need to create their wallets. It is quite easy to obtain a reliable Bitcoin wallet.
Bitcoin wallets are electronic wallets that allow you to store, send, and receive bitcoins. With Coin Wallet, your money is kept safe when you aren’t using it and is easily accessible when you want to sell your coins or buy more.
However, Bitcoin wallets do not store Bitcoins. Cryptographic keys – the information needed to access Bitcoin addresses and process transactions – are stored in a cryptocurrency wallet. This is also the case with other cryptocurrencies
Bitcoin Wallet Types
Wallets for bitcoins are available in a variety of styles. Investors of all types will be able to find a wallet that suits their needs due to the wide range of cryptocurrency wallet options.
All crypto wallets have pros and cons depending on the type of user. Taking a closer look at some of them will be helpful.
The Software Wallet
Unlike physical wallets, software wallets do not have physical forms.
The Exchange wallets
You are most likely to encounter exchange wallets as your first crypto wallet. You can store your digital currency on these platforms, which include crypto and non-crypto exchange platforms.
For absolute beginners who are just trying out crypto for the first time and do not plan to purchase a lot of it yet, exchange wallets are ideal. Wallets offered by exchanges can be relatively secure and reliable but come with unfavorable withdrawal fees and other restrictions, such as only being accessible from the exchange on which they are offered. They are, however, free and easy to use.
The Web wallets
Web wallets are among the most popular types of software wallets. You can store your private keys on these extensions or websites in a safe and easy-to-access manner. They typically support multiple coins or tokens.
Most often, these wallets are free and extremely easy to use. Accessing and transferring assets from a web wallet is quick and easy from any device. As web wallets are directly connected to the internet, they are usually a lot less secure than other wallet types.
The Desktop wallets
You can store your private keys on your computer with desktop wallets. It can be said that they combine the best features of both always-online web wallets and extremely secure cold hardware wallets.
The same as other types of software wallets, desktop wallets offer high accessibility and are reasonably secure, but they cannot fully protect you from hacker attacks, especially if you are not careful with your data security.
The Mobile Wallet
Mobile wallets enable users to manage and control their assets on their mobile devices through an app. Apps that function as cryptocurrency wallets are similar to desktop wallets, but they have the added advantage of mobility, so they are a great choice for people who travel a great deal and always need their mobile devices with them.
The mobile wallet is technically a software wallet, but we decided to give it its category due to its popularity and ease of use. The security standards of many mobile wallets are extremely high without sacrificing usability.
Since mobile wallets are usually free, they are probably the most popular type of crypto wallet. For those who wish to make many transactions while still maintaining the safety of their funds, they are an excellent choice.
The Hardware Wallet
Unlike a software wallet, a hardware wallet consists of a physical device that stores your private key. Wallets are an excellent method for keeping your coins safe, particularly since they can be used for cold storage (i.e., detached from the internet).
Quite a few hardware wallet models allow you to store different coins and tokens on the same device. Hardware wallets have the disadvantage that they make it slightly more difficult to make transactions and are a bit more difficult to use than many software wallets. Bitcoin hardware wallets are ideal for those who wish to invest for the long haul and for those who buy large amounts of cryptocurrency.
The Paper Wallet
In a paper wallet, private keys and QR codes are stored on a piece of paper, which can be used to make outgoing and incoming transactions. Because paper wallets are completely disconnected from the internet, many people consider them to be the most secure form of crypto wallet. The only downside to paper wallets is that they are easily lost. Since a paper wallet is simply a piece of paper, it cannot be reinstalled on another device like a wallet app. Numerous horror stories have been reported about people losing their Bitcoin paper wallets containing hundreds of bitcoins.
Despite the differences in features and requirements, Bitcoin wallets are usually created similarly. To do so, follow these steps:
- You may choose the type of wallet you wish to receive (web, desktop, mobile).
- The wallet should be downloaded and installed if necessary.
- Please create an account.
- Choose an appropriate password.
- Locate your Bitcoin address.
- Make a secure backup of your wallet (with a seed phrase or two-factor authentication).
Hardware wallets are harder to find. If you decide to purchase it in person, you must either wait until it arrives online or place an order online. Then, simply follow the instructions provided by the manufacturer – some hardware wallets require you to install some additional software on a PC or mobile device, while others are set up directly on the device.
A hardware wallet might be more difficult to use at first than a mobile one, but that’s the price you have to pay for added security and reliability.
How do I find my Bitcoin receiving address?
In the same way, as the name implies, Bitcoin receiving addresses are addresses you use to receive bitcoin. Virtual wallets all have receiving addresses.
Unlike bank account numbers, Bitcoin addresses contain only letters and numbers instead of only digits. This statement is preceded by a 1 or a 3, usually quite long, and contains uppercase and lowercase letters.
Upon establishing a Bitcoin wallet, a new BTC receiving address is automatically generated; therefore, if you have already created one, it has already been set up for you. Every time you perform a transaction, a new address is generated. The old address does not expire and may be reused. Your crypto wallet will contain a record of all the addresses created.
Given the complexity of bitcoin addresses, it is important to double-check all crypto addresses you enter. If you prefer, you can use services such as FIO Protocol to transform your long and complex Bitcoin receiving addresses into something that is more human-friendly.