Why You May Want To Prefer Multichain Crypto Wallets. The Best Multichain wallet checklist.Jan 30, 2023
When you invest in crypto, you technically become your own bank. The first thing to care about (after deciding to invest) is to think about how to safely store your assets. Let's pick the right wallet for novices and average crypto users in general.
What Types of Wallets Exist
There are several crypto wallets to choose from. Two main types are cold wallets and hot wallets.
Cold wallet, also known as a hardware wallet, is a physical device connected to your computer or mobile to access funds.
Trezor, CoolWallet S, Ledger.
Hot wallet is an interface or app that speaks to the blockchain and provides access to your crypto.
- Exchange wallets. Wallets offered by exchanges.
Coinbase, Binance, etc.
- Software wallets. An app that helps to access and manage funds.
Exodus, MetaMask, TrustWallet, etc.
- Mono-chain wallets. Bitcoin Core.
- Multi-chain wallets. Atomic, Arctic Wallet.
So which one to choose?
Let's review the pros and cons of both types to help us strike the right balance between functionality and security.
- Cold wallets are considered the safest tool to store your crypto as it doesn't store your keys online.
- However, they cost money and require a user to be quite tech-savvy and aware of know-how.
- To add, the protection they offer is often redundant for a general or a new crypto user.
- Require less responsibility from you as a user - you can reset your password anytime and restore access.
- As a rule, offer a lot of functions including staking, P2P trading, and so on.
- Private keys are controlled by a third party and the wallet technically does not belong to you. Oops.
- In the majority of cases, KYC procedure is a must, so your private data is exposed.
- Offers full control over your tokens as you are the one owning your credentials, seed phrase, and private keys.
- Funds won't be impacted in case the exchange is hacked.
- It's non-custodial and quite safe as they do not store your private keys anywhere, but leave this part to you.
- No KYC procedure.
- No way to restore funds if you lose the seed phrase.
Analyzing the above, we can say that there are more pros than cons for hot wallets, namely, software wallets. Users get exposed to a very real risk when relying on exchanges to secure their holdings. The first rule of crypto is to never long-term store your crypto on any exchange. If you do, you leave yourself vulnerable to hackers.
That is exactly why software wallets appear to be the best option for many crypto holders. Are Mono Chain wallets still a thing? The answer appears to be no, as users need a single app - a full-fledged gateway to the entire ecosystem to fully benefit from decentralized finance.
Checklist for The Best Software Crypto Wallet
Now, when we finally decide what direction to look at, let's decide which features we want from any software wallet and review a few wallets as an example.
- Full Control over your funds. As the main reason, we invest in crypto is to own our assets
- Functionality. You will want to easily swap, store, and send your currencies to whatever address you want to send them to;
- Wide number of supported chains. That is what we're here for!
- Trustworthiness. While you manage funds, you want to make sure it's safe and secure.
- Transparency. You want to stay informed of all the steps and have a clear view of the assets you have.
- Ondorading friendliness. The good thing is when the app educates you as you go
- Relevant support. To quickly help with any issues
- Seamless UI and UX. To ensure the ease of buying/selling and performing all the operations.
|Image Source: Arctic Wallet Team
That wraps up our brief look into Multichain Wallet key benefits. Multichain software wallets come to be the perfect choice for both new crypto users and experienced crypto enthusiasts due to combining great functionality and security.
Software wallets teach responsibility as it's impossible to restore assets if you lose private keys. Yet, in return, they give you complete control over your digital currencies.