8 Best Crypto Wallets of May 2023
Rankings as of May 05, 2023.
Money is not a client of any investment adviser featured on this page. The information provided on this page is for educational purposes only and is not intended as investment advice. Money does not offer advisory services.
Crypto wallets are an essential tool for buying, trading and selling cryptocurrencies. Traders need them to store crypto securely, as well as to protect and validate transaction information. Be it hardware or software, also called hot and cold crypto storage, custom crypto wallets offer traders dedicated solutions compared to those from crypto exchanges.
Read on to learn about the different types of cryptocurrency wallets, how they work, and which one you should pick.
*Some people searching for crypto wallets are looking for a crypto exchange, which is why we’ve included Public.com in this comparison table. If you’re more interested in learning where to buy and sell cryptocurrency, as well as, pros and cons of centralized vs decentralized exchanges, you might consider reading our piece on the Best Crypto Exchanges.
Our Top Picks for the Best Crypto Wallets of May 2023
- Coinbase Wallet - Best for Beginners
- MetaMask - Best for Ethereum
- TrustWallet - Best for Mobile
- Ledger Nano S Plus - Best Hardware Crypto Wallet
- Electrum - Best Desktop Bitcoin Wallet
- BlueWallet - Best Mobile Bitcoin Wallet
- Exodus - Best for Desktop
- Crypto.com - Best deFi wallet
Best Crypto Wallet Reviews
- User-friendly interface that is easy to navigate
- Supports more than 5,500 digital assets
- Multi-signature and two-factor authentication support
- Backed by a reputable trading platform that is able to recoup lost or stolen assets
- Similar security issues and weak points as other hot storage alternatives
- Only available on mobile and tablet devices (except for Chrome extension)
Why we chose it: We chose Coinbase Wallet as the best crypto wallet for beginners because it’s an intuitive and highly secure wallet backed by a well-known exchange.
Coinbase Wallet is an excellent wallet for beginners with little to no experience with crypto. The app connects to most major bank accounts, and the user interface was designed to be intuitive and easy to navigate, with a simple three-tab layout and clearly identifiable functions.
Coinbase Wallet can store popular coins, such as Bitcoin, Litecoin, Dogecoin and BNB, as well as all ERC-20 tokens and tokens on EVM-compatible blockchains, which amounts to more than 5,500 supported digital assets — one of the biggest numbers on our list.
It’s important to make a distinction between the Coinbase exchange and the Coinbase wallet. The Coinbase exchange is one of the oldest and most well-known crypto trading platforms in the US. Holding your digital assets on the exchange’s web wallet makes it easier to trade, but leaves your coins exposed to more dangerous cybersecurity threats.
The Coinbase wallet may be used without opening an account with the exchange and it's non-custodial, meaning the private key is stored in your device — not in Coinbase’s servers. This means you don’t need to worry about your currencies being locked for any reason or exposed to a cyberattack on the website.
- Uses the Secure Enclave chip available in Android, iOS, iPad and Mac devices to provide biometric authentication (e.g., FaceID, TouchID)
- Provides access to decentralized exchanges in-app, which can convert tokens without any intermediaries
- Offers optional cloud backups to protect your digital keys
- Intuitive interface design on browser extension and app
- Can be linked to NFT marketplaces
- Supports thousands of dApps
- Fees to buy Ether can be high
- Cannot directly store Bitcoin
Why we chose it: We chose MetaMask as the best crypto wallet for Ethereum because its user-friendly interface provides quick and easy access to thousands of tokens and decentralized apps within the Ethereum network.
MetaMask is one of the most widely used Ethereum wallets, with over 30 million monthly active users. This may be due to its ease of use and accessibility: The wallet has an attractive and straightforward design for beginner investors looking to store and send Ethereum-compatible cryptocurrencies and interact with decentralized apps (dApps).
MetaMask is also notable for its compatibility with other blockchain solutions. Users can add almost any blockchain network to the app. The wallet fully supports popular Web3 networks, including Polygon, Binance Smart Chain and Avalanche. Users can also access popular NFT marketplaces like OpenSea, and swap a variety of collectibles by connecting them directly to the blockchain wallet.
Anyone using Google Chrome, Microsoft Edge, Mozilla Firefox or Brave browsers can download the wallet as an extension. You can also download the MetaMask app on your mobile Android or Apple devices.
- Built on open source code, which allows developers and security experts to review the software to make sure it’s secure
- Account information is encrypted and stored locally — no information ever touches the MetaMask servers — which means users have full control of their private keys
- Quickly swap between layer one and layer two Web3 solutions
- Supports a vast range of coins and tokens
- Earn interest on one of 12 different cryptos
- Simple and easy-to-use interface
- Built-in Web3 browser
- Owned by Binance, who has faced regulatory issues in the U.S.
- Educational resources on coins and tokens are limited
Why we chose it: We chose Trust Wallet as the best crypto wallet for mobile because it features a clean, scannable user interface, built-in support for dApps and NFTs and the largest number of supported assets on our list.
Trust Wallet is a popular mobile online crypto wallet and the official mobile app of Binance, one of the leading cryptocurrency exchanges in the world. Despite its links to Binance, the wallet is non-custodial, which means it does not keep your private keys, and the user is responsible for safeguarding them. It supports over 65 blockchains, which is how it’s able to store such a wide variety of digital assets — over 4.5 million coins and tokens, the largest number on our list.
Trust Wallet is also a great mobile option for NFT and decentralized app enthusiasts. The wallet has a built-in Web3 browser, allowing users to access dApps and blockchain games directly through the app. This feature makes buying NFTs easy, as users can look, purchase and store tokens using the incorporated decentralized exchange, all without leaving the app.
Other highlights include:
- Integration with Binance DEX lets users buy large numbers of tokens with a debit or credit card
- Among the highest-rated cryptocurrency mobile wallets on both Apple and Google marketplaces
- Install up to 100 apps at the same time
- Buy and sell crypto directly through the Ledger Live app
- Verify all transactions with 2-button presses
- Compatible with 50 other hardware wallets
- More expensive than its original entry-level wallet
- Custom operating system is not open source
Why we chose it: We chose Ledger Nano S Plus as the best crypto hardware wallet because of its large number of supported assets, tight security framework and trading capabilities through the integrated Ledger Live app.
Ledger is one of the most well-known brands in the crypto space, with hardware wallets that are a popular choice among crypto enthusiasts. Its products stand out for using a Secure Element component — a type of chip often seen on passports, credit cards and payment systems — to provide an extra layer of security.
Its first wallet, the Nano S, was upgraded in April 2022 to the Nano S Plus, which came with an improved display, much greater storage capacity and a USB-C cable port. This upgrade to the Ledger Nano S made an already strong entry-level product even more enticing when compared to its bigger brother, the Ledger Nano X.
The wallet costs $90.18, a convenient price point that sits comfortably between cheaper and more expensive alternatives available in the market today. Moreover, it measures 2.2 × 0.7 × 0.36 inches and features a 128 x 64-pixel screen, meaning it's easier to carry around and to cycle through your installed apps.
- The first and only hardware wallets of its kind to be certified for security by a government agency (in Ledger’s case, by ANSSI, the French cyber security agency)
- The Ledger Live app, which can be used to monitor, lend and stake crypto in addition to buying and selling digital assets
- Fast and easy to set up
- Greater security than other hot wallets
- Customizable transaction fees
- Wallets don't suffer downtime thanks to server configurations
- Setup and interface not ideal for beginners
- No customer support via chat, email or phone
Why we chose it: We chose Electrum as the best Bitcoin wallet because of its extensive security features and high degree of customizability.
Founded in 2011, Electrum is one of the oldest and most well-known crypto wallets today. It’s also one of the few remaining crypto wallets that only deals in Bitcoin, a currency that Electrum is uniquely outfitted to support.
The wallet hosts a variety of robust security features, including 2FA, transaction proof checking, and multi-signature wallet support. Moreover, users can adjust their fees depending on how long they’re willing to wait for a transaction to be completed: Pay more in fees, and your transaction will be executed faster.
One of the wallet’s greatest assets is that it uses a lightweight client. Light clients can be set up in a matter of minutes and take up less space than traditional wallet clients on your computer. By using simple payment verification (SPV), the wallet only downloads parts of the blockchain, which speeds up transactions without compromising security.
- Open-source wallet, which means its code is available for scrutiny, helping to build trust with consumers
- Supports both standard deterministic accounts and Hierarchical Deterministic (HD) accounts
- Integration with hardware wallets (KeepKey, Ledger, Trezor) for cold storage
- Modern design with an accessible user interface
- Supports both on-chain and lightning transactions
- Create or import multiple wallets
- Multi-signature vaults for added security
- No two-factor authentication
- Advanced tools could use in-app tutorials
Why we chose it: We chose BlueWallet as the best bitcoin wallet for mobile because of its feature-rich mobile app, simple user interface and integration with the Lightning Network.
BlueWallet is an excellent alternative for Bitcoin traders who can’t or don’t want to make sense of more complex software on their desktop computers. It’s similar to Electrum in that they are both bitcoin wallets only, which means they can focus entirely on innovating and improving the Bitcoin experience on the platform.
The wallet’s interface is welcoming and easy to navigate for beginners, but the app also includes a number of additional features that more advanced users may appreciate. In addition to basic functionality like sending, receiving and storing BTC, BlueWallet allows users to send batch transactions, customize fees and establish a Tor connection for enhanced privacy.
Another big advantage of BlueWallet is its integration with the Lighting Network, a layer two solution that makes peer-to-peer payments much faster than on bitcoin’s layer one network. It helps to think of the Lightning Network as an expressway that sits on top of the regular Bitcoin blockchain.
- Watch-only wallets, which lets users keep an eye on their cold storage without interacting with their private key
- Plausible deniability, a BlueWallet feature that allows users to establish a different password that will decrypt a "fake" wallet set up
- Supports over 260 crypto assets
- Compatible with Trezor One and Trezor T hardware wallets
- Allows users to buy Bitcoin with Apple Pay
- 24/7 customer support
- High transaction fees on the in-wallet crypto exchange
- Lack of native 2-factor authentication may bother some users
- No multi-signature support
Why we chose it: We chose Exodus as the best crypto wallet for desktops because of the speed of its transactions, ease of use, and the varied functionality of its client.
Exodus is one of the most visually appealing and intuitive wallets on the market. Initially a desktop-only wallet, Exodus now has apps for iOS and Android and is also compatible with Trezor wallets, a popular hardware wallet brand. Nonetheless, the desktop wallet application — available across Windows, Linux and Mac operating systems — is still the wallet’s core offering and is updated every two weeks.
One of Exodus’ main draws is the number of currencies it supports: more than 260 crypto and NFTs, a larger number than many other hot wallets. This includes established altcoins, such as Ether, Litecoin, XRP and Bitcoin Cash, as well as popular meme coins like Dogecoin and Shiba Inu.
The wallet also features a growing number of apps being released to diversify the wallet’s functionality, including apps for live charts, crypto staking and crypto deposits.
- Customizable fees for Bitcoin, Ethereum and ERC20 transactions
- Runs on a light client, meaning it uses simple payment verification and doesn’t download complete blockchains in order to speed up transactions
- Choose your preferred trading fee and confirmation speed
- Over 250 coins, including BTC, ETH, CRO, ATOM, DOT and LTC
- Earn interest on more than 21 cryptocurrencies
- Funds are inaccessible if you lose your private key and recovery phrase
- Built-in token swap has some geo-restrictions
Why we chose it: We chose Crypto.com as the best DeFi crypto wallet because of its variety of decentralized finance tools, excellent onboarding process and strong security framework.
The Crypto.com DeFi Wallet is an excellent choice for users starting their journey into decentralized finance. Defi wallets give users complete control over their digital assets and private key, which they are responsible for safekeeping. This type of blockchain wallet also has features not available for regular, custodial wallets, including one-to-one crypto swaps and a wide range of tools for users to earn passive income on the crypto they already own.
As with other exchanges that feature both a custodial and non-custodial wallet, it’s important to make the distinction between the two. You can download the Crypto.com DeFi Wallet and use it for your day-to-day crypto activities without having to create an account on Crypto.com’s exchange platform.
Consumers should be aware that decentralized finance products and services carry significant risks and should be engaged prudently.
- Several layers of security, including biometric authentication, 2-factor authentication, and Secure Enclave technology on iOS devices
- Create multiple digital wallets and import other wallets
- Connect to other decentralized apps through the WalletConnect tool
Other crypto wallets we considered
- Choose between the entry-level Trezor One and the Trezor Model T
- Intuitive & convenient interface — including a touchscreen for the Model T
- More expensive than other hardware wallets with similar functionality
- No support for iOS devices
Along with Ledger, Trezor is one of the two most well-known brands of hardware wallet in the world of crypto. Developed by SatoshiLabs, Trezor was the first hardware crypto wallet, and both of its current models feature excellent security measures and support many assets.
Why Trezor didn’t make the cut: Trezor didn’t make our top list since the models offered by Ledger outmatched the former’s regarding its build and the number of supported currencies. We still highly recommend Trezor for anyone who uses the Exodus wallet as their main crypto wallet due to its native compatibility with Trezor devices.
- Reasonably priced hardware wallet
- Device display supports QR codes
- Supports a limited number of coins
- Heavier than similarly priced competitors
The KeepKey is an excellent solution for those looking for an affordable hardware wallet. It’s priced at $49.00 and features an attractive, beginner-friendly display and interface. The wallet also follows top-grade security standards.
Why KeepKey didn’t make the cut: Like the Trezor models, KeepKey was outclassed in terms of features and build when it came to the best hardware wallet.
- Supports over 300 coins and tokens
- Supports credit card purchases and in-wallet exchanges and conversions
- No hardware wallet integration
- Not many coins are available for the atomic swap feature
Atomic Wallet is a hot storage wallet with plenty of advantages. Users don’t need to open an account to use it, customer support is available 24/7 and the wallet supports many assets. One highlight is the Atomic Swap feature, which uses a decentralized crypto exchange housed within the wallet to exchange currencies without third parties.
Why Atomic Wallet didn’t make the cut: Despite its many advantages, the Atomic Wallet didn’t land on our top list because other blockchain wallets offer better features.
- Keyless security system assures there is no single point of failure
- Buy crypto with credit, debit, bank transfer and Apple Pay
- Not having private keys is a big source of contention for some traders
- Not all features available worldwide
ZenGo's unique approach to user security makes it a contentious wallet among crypto traders. Through various security tools, including biometric encryption, three-factor authentication, and multi-party computation cryptography, it can operate as a non-custodial wallet but without private keys.
Why ZenGo didn’t make the cut: ZenGo has many noteworthy features, including its simple user interface, support for dApps and NFTs and crypto staking, but the wallet’s unconventional approach to security kept it from being featured in our top list.
- Oldest multi-chain wallet available, has never been hacked
- Built-in exchange and large number of supported assets
- Two-factor authentication not supported
- Closed-source wallet code lack transparency
Coinomi was designed from the ground up as a multi-chain wallet, meaning a crypto wallet that has an address on multiple blockchains, allowing users to send and receive transactions on all of them. The wallet also has strong security features, over 1,700 tradable assets, and offers 168 fiat currency representations — readable in 25 languages.
Why Coinomi didn’t make the cut: Coinomi did not excel in any of the categories we considered when evaluating crypto wallets. However, we can recommend the wallet for those specifically looking for a multi-chain wallet.
- Multiple account types available
- Simplified payment verification
- Only supports Bitcoin, Ether and ERC-20 tokens
- May be confusing for beginners
Mycelium is a well-established crypto wallet with a tenured track record and a big focus on bitcoin. Since it was introduced to the market in 2008, it has been a mobile-only software wallet and continues to be one of the best options for Android and iOS users who don’t mind the limited selection of digital assets it supports. The wallet also features a high level of security.
Why Mycelium didn’t make the cut: We found that Mycelium didn’t fill any particular niche in the crypto wallet field, and the app’s clunky user interface kept it out of our best for mobile category.
Crypto Wallets Guide
Blockchain technology has made digital currency transactions increasingly useful, practical and accessible. However, as the number of crypto users has gone up, so has the rate of cyber theft related to cryptocurrencies. That’s why it’s important to understand how to safekeep your crypto by learning about crypto wallets, how they work and what to look for in one, whether it’s digital or physical.
- What is a crypto wallet?
- How do crypto wallets work?
- Types of crypto wallets
- How to set up a crypto wallet
- What to look for in a crypto wallet
- Investing in crypto prudently
What is a crypto wallet?
Cryptocurrency wallets, or simply crypto wallets, are places where traders store the secure digital codes needed to interact with a blockchain. They don’t actively store your cryptocurrencies, despite what their name may lead you to believe.
Crypto wallets need to locate the crypto associated with your address in the blockchain, which is why they must interact with it. In fact, crypto wallets are not as much a wallet as they are ledgers: They function as an owner’s identity and account on a blockchain network and provide access to transaction history.
How do crypto wallets work?
When someone sends bitcoin, ether, dogecoin or any other type of digital currency to your crypto wallet, you aren’t actually transferring any coins. What they’re doing is signing off ownership thereof to your wallet’s address. That is to say, they are confirming that the crypto on the blockchain no longer belongs to their address, but yours. Two digital codes are necessary for this process: a public key and a private key.
A public key is a string of letters and numbers automatically generated by the crypto wallet provider. For example, a public key could look like this: B1fpARq39i7L822ywJ55xgV614.
A private key is another string of numbers and letters, but one that only the owner of the wallet should know.
Think of a crypto or blockchain wallet as an email account. To receive an email, you need to give people your email address. This would be your public key in the case of crypto wallets, and you need to share it with others to be a part of any blockchain transaction. However, you would never give someone the password to access your email account. For crypto wallets, that password is the equivalent of your private key, which under no circumstances should be shared with another person.
Using these two keys, crypto wallet users can participate in transactions without compromising the integrity of the currency being traded or of the transaction itself. The public key assigned to your digital wallet must match your private key to authenticate any funds sent or received. Once both keys are verified, the balance in your crypto wallet will increase or decrease accordingly.
Types of crypto wallet
Crypto wallets can be broadly classified into two groups: hot wallets and cold wallets. The main difference is that hot wallets are always connected to the internet while cold wallets are kept offline.
Hot wallets are digital tools whose connection to the internet cannot be severed. Users can access these pieces of software from a phone or desktop computer to monitor their currencies and trade them. Some hot wallets are also accessible through the web or as browser extensions, meaning you can use them on a wide variety of devices.
The greatest advantage of hot wallets is their convenience. Your public and private keys are stored and encrypted on your wallet’s respective app or website, so unless they're limited to a specific device, you can access them anywhere with an online connection. This ease of access makes them ideal for those who trade more often and are considering spending bitcoins.
Because hot wallets are always accessible online, they also face a greater risk of cyberattacks. Hackers can exploit hidden vulnerabilities in the software that supports your wallet or use malware to break into the system. This is particularly dangerous for web wallets hosted by crypto exchanges, which are bigger targets overall for crypto thieves.
- Highly convenient, can be accessed from anywhere with an internet connection
- Easier to recover access if you lose the private key than cold wallets
- Less secure than cold wallets, vulnerable to a wider variety of attacks
- For custodial wallets, your keys are kept on the exchange's servers
Cold wallets store your digital keys offline on a piece of hardware or sheet of paper. Hardware wallets usually come in the form of a USB drive which lets you buy, sell and trade crypto while it’s connected to a computer. With “paper” wallets, your keys may be accessible via print-out QR codes, written on a piece of paper, or engraved on some other material, such as metal.
Cold storage wallets are deliberately designed to be hard to hack. Unless the wallet owner falls for some sort of phishing attack, hackers have no way of obtaining the owner’s keys remotely. For something like a hardware wallet, a thief would first have to obtain the USB drive used to access your crypto and then somehow crack its password.
This high level of security may lend itself to mistakes on the part of wallet owners. If you lose your USB drive or sheet of paper and don’t have your private key backed up somewhere, you’ve effectively lost access to your crypto. Compared to hot wallets, which make it possible to regain access through a seed phrase, recovering access on a cold wallet is impossible in most cases due to the two-key security system.
- More secure than hot storage wallets due to offline storage
- Many hardware wallets are supported by hot storage wallets
- Transactions take longer on average
- Nearly impossible to recover currencies without a backup of your digital keys
How to set up a crypto wallet
Setting up a cryptocurrency wallet is a generally straightforward process that takes no more than a couple of minutes. The first step is to determine the kind of crypto wallet you want to use since hot wallets and cold wallets have different set up processes. Then, you’ll need to do the following:
For hot wallets…
- Download the wallet. Make sure the wallet is legitimate before downloading any software. Crypto scams are becoming increasingly common and it's important to know if the company behind a wallet actually exists. For web wallets, verify that you are on the correct website and not on a fake version of it built to steal your information.
- Set up your account and security features. If you are using a non-custodial wallet, this is when you’ll be given your private key, a random 12 to 24-word string of words. If you lose or forget these, you will not be able to access your crypto. You can enable added security tools, like two-factor authentication and biometrics, during or after the set up process. The process for custodial wallets is a bit more involved, and you’ll have to undergo a verification process called Know-Your-Customer (KYC) to validate your identity.
- Add funds to your crypto wallet. For non-custodial wallets, you may have to transfer crypto from elsewhere, as not all wallets allow you to buy crypto with fiat currency directly. As for custodial wallets, you’ll need to fund them using a credit or debit card before you can purchase crypto, in some cases.
For cold wallets…
- Purchase the wallet online. When buying a cold wallet, avoid third-party resellers. Buy the product directly from the developer to avoid issues, such as the device being tampered with beforehand.
- Install the device’s software. Each brand has its own software that must be installed onto the hardware device before it can be used. Make sure to download the software from the company’s official website. Then, follow its instructions to create your crypto wallet.
- Deposit your cryptocurrency. You’ll need to transfer crypto into your hardware wallet from elsewhere, such as from a crypto exchange. Some wallets may have an incorporated exchange that allows you to trade crypto while the device is connected to your desktop computer or mobile device.
What to look for in a crypto wallet
When looking for the best crypto wallet, it’s very important to first ask yourself:
- How often do I trade? Will you be trading cryptocurrency daily or just occasionally? Hot wallets are better for active traders due to their speed and practicality. However, active traders may also benefit from a cold wallet by using it as a kind of savings account, keeping the bulk of their currencies there.
- What do I want to trade? Are you looking to buy and store Bitcoin or are you interested in different types of cryptocurrency, like altcoins and stablecoins? The crypto wallet you pick should support the currencies you wish to trade and will ideally accommodate any other coins you may want to trade in the future.
- How much am I willing to spend? Are you planning on accumulating large amounts of crypto? Hardware wallets are ideal for this sort of activity, but unlike hot wallets (which are mostly free), they require an upfront payment to own the wallet itself. Some hot wallets have higher crypto trading fees but offer faster transactions or greater functionality.
- What functionality do I need in a wallet? Do you plan on doing anything specific with crypto beyond simply trading it? For example, traders who want to make money with their crypto passively should look for wallets that allow for crypto lending, staking and deposits.
After exploring the above questions, we put together some general suggestions for what to look for in a crypto wallet:
- Supported currencies - The rule of thumb for supported currencies is “the more, the better.” Unless you're interested in solely trading Bitcoin — in which case you should look specifically for a bitcoin wallet —, we suggest you opt for a wallet that supports at least a few of the more popular altcoins, such as Ethereum, Cardano and Solana.
- Accessible interface - An accessible, intuitive user interface is always welcome, regardless of whether you’re a crypto veteran or a newbie. Look for wallets that don’t make you jump through hoops to start basic trading.
- 24/7 customer support - Although more useful for newer traders, having customer support available throughout the day is always a plus. This is especially true for wallets that undergo frequent updates and may suffer from bugs or visual glitches.
- Hardware wallet compatibility - Anyone who is seriously thinking about getting into crypto should consider getting a hardware wallet. Even people who don’t trade frequently should consider a hardware wallet to safeguard their most important assets. Investors with a hot wallet that’s compatible with at least one brand of hardware wallet have an advantage, since they can default to the model(s) supported by their wallet and transfer their crypto back and forth as needed.
Investing in crypto prudently
Cryptocurrencies are a new and exciting financial asset. The idea of a decentralized currency independent of the banking industry is enticing for many. The wild price swings can be a thrill, and some coins are simply amusing.
Consider the story of Dogecoin. A portmanteau of Bitcoin and Doge, the currency was a hit on Reddit, a popular social network forums site, and quickly generated a market value of $8 million. DOGE hit an all-time high on May 8, 2021, reaching a market capitalization of more than $90 billion after Elon Musk and Reddit users involved in the GameStop short squeeze turned their attention to it.
For a more sobering example, take a look at Bitcoin — the grandparent of all cryptocurrencies. Bitcoin has experienced multiple crashes throughout its lifespan, but its most recent one has left a lasting impression on mainstream culture. Reaching an all-time high of more than $65,000 in November 2021, its market value has declined as part of a general crypto price drop, briefly dipping under $20,000 in June 2022.
While entertaining, the fact remains that cryptocurrencies are unpredictable assets and should be traded with caution. It’s important to consider the following dangers when asking yourself, “should I invest in cryptocurrencies?:”
Crypto is volatile. A cursory glance at the historical price of Bitcoin is enough to see massive peaks and depressions throughout its lifespan. Just recently, Bitcoin fell under $20,000 in June 2022 after having surpassed a value of $69,000 for a single coin in November 2021. The same goes for any other major cryptocurrency. These dramatic changes are not normal compared to the pace at which mainstream assets move.
Crypto isn’t backed by anything. Most coins do not have a natural resource, such as gold, silver or other metals, that is used to track their value. They're not backed by the government and don’t track the growth potential of enterprises the way stocks and bonds do. This increases crypto's volatility as a whole.
Cryptocurrencies are also speculative assets, which are riskier due to large fluctuations in price. Many active traders invest in them with the hope of making a big profit after their value dramatically increases in the near future — hopefully before a crash.
Crypto is unregulated. Governments and institutions worldwide are still grappling with how to regulate cryptocurrencies, asking: Do we need specific legislation to regulate crypto assets? Who should regulate crypto? Should it be regulated at all?
While this lack of regulation responds to the nature of crypto and its ethos of freedom, a lack of adequate regulation means consumers are not protected against many crypto crimes and scams. Ultimately, crypto must be studied and handled carefully, as its future remains uncertain.
Personal finance experts and advisors recommend investing no more than 5% of your portfolio in risky assets like crypto. Beginners should also refrain from riskier crypto trading practices, such as lending and staking currencies to generate revenue.
Crypto Wallet Glossary
- Blockchain: A blockchain is a type of ledger that records digital transactions and is duplicated across its entire network of systems. The shared nature of blockchain creates an immutable registry that protects users against fraud. Cryptocurrencies are traded on the blockchain.
- BTC: BTC is the currency code used to represent Bitcoin, which was created by Satoshi Nakamoto as the first decentralized cryptocurrency. Bitcoin wallets specialize in storing and using this cryptocurrency. Read our article on what is Bitcoin to find out more.
- Hierarchical Deterministic (HD) account: HD accounts may be restored on other devices by using a backup phrase of 12 random words that's created when you generate the wallet.
- Light client: Also called light nodes, light clients implement SPV, a technology that does not require downloading an entire blockchain to verify transactions. Depending on the currency, a full blockchain could be anywhere from 5Gb to over 200Gb. Thus, light clients tend to be faster than regular clients and require less computing power, disk space and bandwidth. Mobile wallets almost always use light clients.
- mBTC: A common exchange value, mBTC is short for millibitcoin, which is one-thousandth of a bitcoin (0.001 BTC or 1/1000 BTC)
- Multi-signature: Multisig for short, wallets with this feature require more than one private key to sign and send a transaction.
- Open-source: Software that is considered “open-source” has a source code that may be studied, modified or redistributed by anyone. The source code is what programmers use to adjust how a piece of software works.
- Seed phrase: Newly opened crypto wallets randomly generate a string of 12 to 24 words known as a seed phrase. Users with non-custodial wallets must keep this phrase and are recommended to write it down in a safe location, since it stores all the information needed to recover access to their wallet and funds.
Latest News on Crypto Wallets
As crypto traders look for other ways to make a profit off of cryptocurrencies, some are wondering if bitcoin mining is profitable. However, rising energy prices, unpredictable results and the significant upfront investment that is required for mining paint a complicated picture of the practice.
The year 2023 is shaping up to be a much better year for cryptocurrency. A strong first quarter rally for crypto has some investors forecasting greater growth for the market later this year, but not all experts are convinced this will be the case. The question remains whether this growth will be sustainable into the second quarter after the disastrous year that was 2022 for the crypto industry.
The hype for new, trendy coins seems to be waning, with nearly 1,900 crypto projects listed in 2022 already dead. According to crypto data aggregator CoinGecko, thousands of new cryptos fail each year. Some may wonder whether this development was inevitable given the boom in new crypto projects in early 2021 and the sharp market downturn that took place later that year.
Best Crypto Wallet FAQ
What is the best crypto wallet?
The best crypto wallet should be easy to use and support a large number of coins and tokens. Hot wallets should include strong security tools, like two or multi-factor authentication and multi-signature support, while charging minimal or no fees. Cold wallets should be available at a reasonable price point and supported by a variety of hot wallets to facilitate trading.
According to our research, some of the best crypto wallets are Coinbase Wallet, the Ledger Nano S, Exodus and Trust Wallet. As for bitcoin wallets, we found the best options were Electrum and BlueWallet.
How to get a crypto wallet
What is a fiat wallet?
What crypto wallet should I use?
What is the safest crypto wallet?
How We Chose the Best Crypto Wallet
We looked at over 25 crypto wallets and evaluated them based on security, functionality and cost. Because crypto wallets come in hot and cold varieties, we considered different factors for each. For instance, the cost of using a hot wallet is hard to establish due to variable exchange, network and wallet fees, but cold hardware wallets are physical products that you must buy at a store.
The wallets included in our list scored high in the following categories:
- Safety - Safety is our top concern when dealing with crypto wallets. We favored wallets with two or multi-factor authentication, biometrics, multi-signature support, open-source code and strong security protocols for transactions. As a rule, we opted against recommending any hardware with additional points of failure, such as bluetooth.
- Features - For features, we considered the general functionality of each wallet. Wallets with a larger number of tradable assets, live charts, staking and lending capabilities, and hardware wallet compatibility scored higher with us.
- Cost - The cost of a crypto wallet depends on the type of wallet. We favored reasonably priced cold wallets and hot wallets with exchanges that charge less for processing transactions. We also considered wallets with customizable transaction fees.
Summary of Money’s Best Crypto Wallet of May 2023
- Coinbase Wallet - Best for Beginners
- MetaMask - Best for Ethereum
- TrustWallet - Best for Mobile
- Ledger Nano S Plus - Best Hardware Crypto Wallet
- Electrum - Best Desktop Bitcoin Wallet
- BlueWallet - Best Mobile Bitcoin Wallet
- Exodus - Best for Desktop
- Crypto.com - Best deFi wallet