With the increasing penetration of cryptocurrencies as a medium of exchange and investment by investors and traders, the need for a crypto wallet with advanced features has also risen over the years. To leverage the popularity of cryptocurrencies, in recent years, hundreds of crypto wallets have mushroomed in the market, which creates a situation of confusion among users. They wonder which is the best crypto wallet suitable for investment goals and objectives. To help the crypto investors, we will have compiled the major factors that define a perfect crypto wallet.
Below is the list of the things to be considered before choosing a crypto wallet.
Do You Need a Crypto Wallet?
The way you need a physical wallet or a bank account to store your fiat money, similarly, a crypto wallet is needed not only to store your crypto assets but also to ensure the security of your funds from potential online risks. For instance, to manage your Tether assets you will need a USDT wallet app where you can receive, send and store your digital assets conveniently.
5 Factors to be Considered When Choosing a Crypto Wallet
Just like you choose a bank account that has robust security, offers the best interest rates, and charges the lowest transaction fees, similarly, you need to consider a couple of things while picking a crypto wallet.
Let’s take a look at the 5 essential factors that an investor needs to consider when choosing a crypto wallet.
The most important thing that a crypto user looks for in a wallet is the security of their funds. Users prefer to use a wallet where they have the assurance that their digital assets are safe. Because all transactions are executed online, there are greater chances of cyberattack, making it imperative to have a wallet with top-north security features.
Hardware wallets have an edge when it comes to security as most of the digital assets are stored in an online cold store where online hacking is nearly impossible. Ledger and Trezor are among the best hardware crypto wallets in terms of security. There are also online wallets such as Binance, Coinbase, and MetaMask which have a reputation for robust security.
Backup and Account Recovery
The wallet is of no avail which does not backup your data and is unable to recover your account in case of a security lapse or lost password. Users should consider the wallet which automatically backs up their data on the remote cloud-based server. There are higher chances that you lose your private key to your wallet or face an account compromise, with your assets locked within the wallet. Your digital assets will be stuck in a wallet that does not have a recovery feature. As such users must go for a hardware or software wallet that provides an easy account backup and recovery feature.
Easy-to-Use User Interface
Despite strong security and trading features, users do not prefer a crypto wallet that is difficult to use. Users should not find it hard to navigate basic features such as withdrawal, deposit, buy and sell. The ease of use is ensured by how user-friendly the user interface of the wallet is. A wallet must have a dashboard with a clear view of all the features, offering easy navigation to the drop-down features on the go. Offering an easy-to-use user experience is the prerequisite of a wallet to be convenient for investors.
The next thing that defines the feasibility of a crypto wallet is the trading features it offers. You may consider the following features while picking a crypto wallet:
It is hectic to use one wallet for trading bitcoin and another to trade Ethereum. It is impractical to use multiple wallets to trade multiple currencies. As such a crypto wallet should be designed to support multiple currencies so that users can access most of them on a single dashboard.
Compatibility and Adaptability
Users prefer wallets that are compatible and adaptable across multiple platforms. A crypto wallet should be compatible with multiple devices such as smartphones, tablets, desktops, and different operating systems like iOS, Android, and Windows so that users can access their crypto wallet across the platform.
A crypto wallet must allow transactions across multiple cryptocurrencies so that a user can diversify their portfolio, without opening multiple accounts in different wallets to access a variety of cryptocurrencies.
Wallet Fees and Charges
The fee is one of the most important factors a user should check before choosing a crypto wallet. Usually, a sum is deducted from your bank account quarterly, half-yearly or yearly in the form of maintenance charges, while credit cards also come with annual maintenance changes. Moreover, charges are also deducted for SMS alerts by your bank.
In the same way, crypto wallets also come with different charges such as transactions, withdrawals, and deposits. It is always wise to compare the fee chart of different wallets before picking one to avoid high fees which may take most of your earnings away.
Users must consider the above factors before they pick a crypto wallet. Security is the most important factor that a crypto wallet must ensure to protect the users’ funds, while one cannot compromise on trading features, transaction fees, user experience, and recovery options. You can explore more on the best Tether wallet, crypto news, etc. to be abreast of the latest trend
in the crypto world.