How to choose a multicurrency wallet?

1. Why do I need a multicurrency wallet?

Altcoins are gaining considerable popularity. This is evidenced by the growth rate of altcoin market capitalization, which has long surpassed that of bitcoin. This is reflected in the steadily declining dominance index of the first cryptocurrency. There are a huge number of altcoins, and the capitalization of some of them has already exceeded $1 billion. Many altcoins are interesting not only because of the technology and the idea behind it, but they are also attractive objects for portfolio investment. A legitimate question arises – where is the best place to keep various digital assets?

2. Why is a separate wallet for each altcoin inconvenient?

Some users set up a separate wallet for each cryptocurrency (for example, Electrum-Dash or Ethereum Wallet). This approach undoubtedly provides a secure way to store digital currencies, as each of these wallets gives control over the private key. If the latter is stored in a secure location (e.g., written down on paper and/or saved to a flash device that is always offline), you can be 100% confident that your digital savings are safe. However, this method has some disadvantages. First, multiple, disparate wallets are inconvenient. Second, for each of them, you need to save a unique seed key phrase (which will be the private key). There are as many digital currencies as there are unique phrases. If you lose one of them, you lose all the digital currency from the corresponding wallet.

3. Why shouldn’t you keep large amounts in exchanges?

Many crypto-enthusiasts prefer to store altcoins on exchanges. This is very convenient, as modern exchanges support dozens or even hundreds of different altcoins. However, this approach has many significant disadvantages, as the user has to trust the funds to a third party. Most crypto exchanges are centralized, completely uninsured against hacking, and regularly subjected to DDoS attacks. All of this puts the safety of funds at risk. Therefore, users who do not trade in large volumes on crypto exchanges should consider other long-term storage options for cryptoassets where control over the private key is provided and thus full control over the digital assets.

Also you may like >  What is cryptography? Who are the cipherpunks?

4. Online Wallets

As with exchanges, this option is difficult to call reliable because it also involves third-party control of the funds. On the other hand, online wallets often support many popular cryptocurrencies and even allow transactions with low fees. However, perhaps that’s where the pluses of this method of storing altcoins end. Among the many online wallets for digital currencies we can highlight the popular in the Russian-speaking segment of the network service Cryptonator or, for example, HolyTransaction.

5. Mobile wallets

With the growth of smartphones, many different mobile wallet services have appeared, both for Android and iOS. Many cryptocurrency online services also have a mobile version (for example, the aforementioned Cryptonator). Some mobile wallets are highly reliable (because they allow you to save a seed phrase) and have an intuitive interface. Such applications include, for example, the Coinomi mobile wallet. The latest version of the wallet offers to save a seed phrase the first time the app is launched. Coinomi integrates the popular ShapeShift exchanger and currently the app supports about 60 altcoins.

6. Cryptocurrencies in the form of browser extensions

In this segment, Jaxx, which exists in the form of extensions for Chrome and Firefox browsers, has gained considerable popularity. This wallet is characterized by ease of use, minimalistic design and flexibility of settings. However, most importantly, it gives you control over your private key in the form of a seed-phrase. The project team is constantly adding support for new altcoins. There is no need to export and save the private key for each of the supported digital currencies – you only need to back up one seed phrase, consisting of 12 words. With this phrase you can restore all wallets and their balances in an instant.

Also you may like >  What is a decentralized exchange?

7. Desktop wallets.

A good tool for storing crypto-assets are multi-currency wallets installed on your computer. Among them are Exodus, which features an intuitive and beautiful interface, control over private keys, a built-in ShapeShift exchange platform and support for multiple altcoins. As for Jaxx wallet, it also has a desktop version available for Windows, OS X and Linux.

8. Hardware wallets

This type of cryptocurrency wallet can be considered the most secure, because these devices provide maximum secure, “cold storage” of digital assets in a secure, isolated environment. This is probably the best way to store significant amounts of funds over the long term. A hardware cryptocurrency wallet has a securely built-in private key that is used to sign transactions. Some of the most popular wallets of this type include Ledger Nano S, Trezor and KeepKey. Each of them supports several of the most popular altcoins, including ETH, LTC, DASH, etc.

You may also like