“We keep our cash in our wallets in daily life, but if I buy a Litecoin, where can I store it if they do not exist physically?” If you’ve ever asked yourself this question, you probably haven’t heard of crypto wallets.

If you want to start mining and buying crypto coins, you will need to have a wallet for them as well. Crypto wallets are not the wallets as we know them but a digital space that can only be accessed through a special key. These are client portals customers can access anytime if they have an Internet connection and their private key.

There are many crypto wallet types, and you should know all the keys and characteristics before choosing one or several of them to store your currencies.

Below, we take a look at some of the most common crypto wallet types.

The Crypto Wallet

When purchasing a cryptocurrency, you will need to keep them in a wallet. A wallet is a digital or physical interface where you can store digital money or crypto. Your crypto coin transfers from your wallet to the other person’s when you wish to transfer it to them. 

The recipient’s wallet number or wallet address is always necessary to do the transaction. Wallets can be available both on the computer and smartphone. 

Your crypto wallet is accessed through a private key, which is essentially a secret password that lets you transmit money from your wallet to any wallet on the planet. Only you know your private key, and in case it gets lost, or you forget it, you won’t be able to access your cryptocurrencies. 

Hot And Cold wallets

There are two types of crypto wallets: hot and cold. In their very basics, hot wallets are the wallets that have a connection to the Internet, while cold wallets are offline wallets.

In a hot wallet, you can access your stored cryptos at all times. However, hot wallets have a disadvantage regarding security; it is easy to hack as you are connected to a network. Hackers can find the net connection you are using. 

What comes to cold wallets, because of being offline, they are more secure than online wallets. However, they are less convenient. Conveying money from cold wallets takes a bit more time and action, making them slower.

Web and Browser Extension Wallets

Web and browser extension wallets are a category of hot wallets, as they can be accessed over the Internet. They can be either single-asset or multi-asset wallets. To access your money in an online wallet, you need to input your private key. 

A wallet extension that runs directly in the browser is a browser extension. Because the utilized private key is usually redeemed directly in the browser, it is safer than online wallets.

Software wallets

Software wallets are applications that may be installed on a computer or smartphone. They are more convenient and reliable than exchanges or online wallets since an attacker would have to access your computer or phone to hack the program.

Final Thoughts

All wallets have their pros and cons. The best choice for you will vary depending on your needs and wants. Most of the available wallets offer key features you may need, such as support of multiple types of cryptocurrencies. The companies producing wallets also offer different customer support channels to make sure you have the best possible experience with their product.