Comparison of multi-chain and single-chain walletsApr 18, 2023
What does any cryptocurrency investor need first? Of course, the place where his funds will be stored safely. For all who invest in crypto, the most secure way is a crypto wallet. There are different types of crypto wallets and the main challenge is to find the most suitable for you.
Cryptocurrency wallets can be classified into multi-chain and single-chain. In this article, we will compare multi-chain and single-chain wallets for both crypto beginners and enthusiasts. We'll overview each wallet type, its features and benefits so that you can make a deliberate decision on which suits you the most.
Choosing the right wallet for storing and managing crypto is the most significant thing for any crypto investor. All the wallets are divided into multi-chain and single chain.
As the name implies:
- Multi-chain wallets enable users to store multiple crypto assets in one wallet;
- Single-chain wallets support only a single cryptocurrency.
Understanding the difference between them is important for all who are looking for a crypto wallet.
A single-chain crypto wallet supports only the assets on one particular chain. Such wallets are generally developed specifically for a public chain.
Single-chain wallets offer a set of advantages, particularly for crypto beginners.
Advantages of single-chain wallets:
- Lower transaction fees
As single-chain wallets generally have much fewer features than multi-chain wallets, there are significantly fewer transactions to process and consequently fewer fees.
- Convenience for crypto beginners
Additionally, single-chain wallets offer a level of convenience that can be extremely helpful for those just starting their crypto journey. Utilizing a single blockchain allows users to manage their cryptocurrency more easily; as all their investments are located in one place, there is no need to learn multiple blockchains. That makes keeping track of their portfolio more simple.
Disadvantages of single-chain wallets:
- Lack of access to different cryptocurrencies
Single-chain wallets have limited access to cryptocurrency assets so they may ultimately impede growth opportunities in the ever-changing world of crypto.
- More risk from hacking attempts
Single-chain wallets can provide a false sense of security by leading users to believe that they are only using one blockchain. This can be especially dangerous as the lack of multiple blockchains implies a greater vulnerability to hacking attempts due to the enhanced focus on one particular wallet.
As it was said, a multi-chain crypto wallet is the place where anyone can store different crypto assets.
Advantages of multi-chain wallets:
- Greater security
These wallets add a layer of security by allowing you to have control over your funds on more than one blockchain and removing the need for relying solely on one single blockchain.
- Faster transactions
Multi-chain wallets enable faster transactions while providing access to multiple currencies, giving users more flexibility when it comes to the different types of cryptocurrencies they hold.
- Access to multiple currencies
You can store, buy and exchange several cryptocurrencies in one place.
- More useful tools
Multi-chain wallets often contain additional features such as portfolio tracking which are essential while managing multiple currencies at once.
Disadvantages of multi-chain wallets:
- Higher transaction fees
These wallets tend to have higher transaction fees than single-chain ones since they often need to manage multiple cryptocurrency chains at once and keep balances across several blockchains.
- Limited availability
Additionally, multi-chain wallets may be more limited in terms of availability as certain exchanges and custodial services may not support them, making it difficult for users to access their assets.
Arctic Wallet refers to multi-chain wallets and supports 200+ assets on 25+ chains. Here you find buy/sell option, built-in exchange, full history tabs, portfolio feature, address book. Download Arctic Wallet on your desktop, Android or iOS.
While choosing a crypto wallet, it's important to understand your expectations and needs.
Multi-chain wallets offer increased versatility, offering easy access to different blockchains and asset types, making them suitable for people who need cross-chain compatibility for their cryptocurrency holdings. Such wallets come with additional security measures to protect customer funds.
Single-chain wallets will be perfect for all who have a small amount of crypto assets and want to store them on one platform, reducing complications when buying or selling cryptocurrency.
Both types of wallets have their advantages and disadvantages which must be taken into consideration before making a decision. Deep knowledge about both types of wallets can help you to make the right decision.