Hot Wallets To Store Your Cryptocurrency

So you've purchased some cryptocurrency, and you don't feel comfortable with having a company be responsible for storing your funds, as rightly you should be. Exchanges do not care about individuals accounts and if or when they are compromised you're left high and dry to fit the bill while they continue on their merry way. Hackers thrive on targetting exchange accounts, and a simple Google search will quickly reveal how common an accurate it is.

Having personally suffered from a hack and my funds stolen, I'll have you know it's not a great feeling, so best to avoid it at all costs. So what do you do if you can't trust exchanges? You store your cryptocurrency on a personal wallet that you own and control.

There are various ways to store cryptocurrency such as cold wallets, paper wallets but this post will focus only on hot wallets.

What is a hot wallet?

A hot wallet usually comes in the form of a desktop, mobile or browser-based application that requires connection to the internet in order to interact with the blockchain. A hot wallet typically offers you, the user the option of creating your own little space to keep digital currency that is tied only to you.

Passphrases

Since a hot wallet is not a physical wallet or account, it is merely a way to interact with the blockchain and verify a set of funds belongs to you. 

The user of a hot wallet will first have to create a passphrase made up of 12 random words. These 12 random words will help you restore your wallet should anything happen or if you would like to add or move your wallet to another device.

Public key

Now that you've secured your wallet its time to create your addresses. Creating an address allows you to receive your currency from an exchange or friends and family, this is known as a "Public Key".

A public key is like an encrypted digital account number that you can share openly with the world For example, If you found this post helpful and would like to donate feel free to use the following public addresses:

• Donating Bitcoin – 1KNgt3PtcXKRcCf59RY6pPeDa7CRi5av13
• Donating Bitcoin Cash – 1M9FYBvwuFNV9DJ8BbGV1m4WMmEMiBDXuv
• Donating Ethereum- 0x6e22095fbb755833a36831701ef43e73a518fbf1
• Donating Litecoin – LeijZSYwXp6MKie983guPswmWRzpA2LqRE
• Donating Dash – XuxUe1tu72xDuiqennd5mGYyWDBAkvG3sY
• Donating Dogecoin – DGXEMYg8VkVBJo9dqMsEqYjXEqaYhuroiJ

You will have a public key for each type of cryptocurrency you own and depending on the type of wallet you have you could have multiple public keys pointing to the same wallet and currency.

Private key

Your private key is an encrypted account number you should never share with anyone. This is how most hacks occur and is the easiest way to lose your funds. A private key is used to independently verify a set of cryptocurrency funds regardless of the wallet it is in. If I gave you one of my private keys you would restore my funds to your wallet without having to get my permission.

Advantages of a hot wallet

Likely the biggest advantage to a hot wallet is that it can be used to help facilitate basic transactions. Individuals looking to actually make purchases with their cryptocurrency assets might choose to use a hot wallet, for instance, as the holdings in that wallet will be transferable across the internet.

You can do transfers by sending money via the public key address or scan a QR code to send your funds. So now that you're comfortable with what a hot wallet is, let's look at the options available. There is a range of hot wallet services available that are free to download, create an account and use regularly, all with their own pros and cons.

Note: 18 July 2018 - Added Edge wallet to the list

Jaxx

Jaxx is a cryptocurrency wallet available for download on 8 platforms. The Jaxx wallet is the top choice of Bitcoin users and cryptocurrency traders worldwide for its security, privacy, and simple yet powerful set of features.

Jaxx features

• Supported coins: BTC, LTC, ETH, DASH and over 20 currencies in total
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get a Jaxx wallet

Exodus

Exodus wraps solid engineering inside beautiful design and created a pretty well thought out blockchain asset experience that "just works for normal people". Their goal is to remove the geek requirements around the use of cryptocurrency and make design usability a priority

Exodus features

• Supported coins: BTC, LTC, ETH, DASH, ETC and over 20 currencies in total
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get an Exodus wallet

Cryptonator

Cryptonator is an all-in-one online Bitcoin wallet which supports multiple cryptocurrencies such as Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH) and others. It enables fast and easy direct transactions and allows instant exchange between different cryptocurrencies in one personal account.

Combining usability with high-level privacy, anonymity and security, Cryptonator offers free multi-cryptocurrency accounts, which are accessible 24/7 worldwide on your laptop, desktop or mobile devices alike.

Cryptonator features

• Supported coins: BTC, LTC, ETH, DASH, ETC and a total of 19 currencies
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get Cryptonator

Coinomi

Coinomi promises users absolute control of money and privacy at any given time and probably supports the most coins I've seen of any wallet. Use it for Bitcoin, Ethereum and a huge number of Altcoins and Tokens always on you, securely with our cross-chain enabled mobile hybrid wallet.

Cionomi features

• Supported coins: BTC, ETH andamp; 40 other currencies + support for 200 ERC-20 tokens
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get Coinomi wallet

Enjiin

The Enjin Smart Wallet foundation rests on our top-of-the-line security architecture. It employs innovative security techniques such as the Enjin Secure Keyboard, the rule of two encryption and other measures to turn your smartphone into a hardware-like secure wallet.

Enjin features

• Supported coins: BTC, LTC, ETH, ETC and all ERC-20 tokens
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get Enjin wallet

Eidoo

The Eidoo app is the easiest way to manage your assets in blockchains. Eidoo is a multicurrency wallet with a single backup passphrase and HD security level. Eidoo is a Multicurrency Wallet for managing all the assets based on the Ethereum blockchain.

Eidoo features

• Supported coins: BTC, LTC, ETH, ETC and all ERC-20 tokens
• Wallet type: Cold storage, not encrypted
• Desktop: Yes
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get Eidoo Wallet

Bread

BRD is the easy and secure bitcoin wallet, the best way to get started with bitcoin. Our simple, streamlined design is easy for beginners, yet powerful enough for experienced users. If you're first getting started with bitcoin or already know what you’re doing, BRD is the smart choice for storing your bitcoin.

Bread features

• Supported coins: BTC, LTC, ETH, ETC and a large number of ERC-20 tokens
• Wallet type: Cold storage, not encrypted
• Desktop: No
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: Yes

Get BRD wallet

Infinito

Infinito Wallet is the mobile universal hot wallet, which offers an extending list of leading cryptocurrencies, such as: Bitcoin, Ethereum, Bitcoin Cash, EOS, Litecoin, GAS, Dash, ETC and Dogecoin. It also supports all tokens on ETH ERC20, NEO NEP-5 and more to come on our roadmap. It officially launched on the 8 December 2017.

Infinito features

• Supported coins: BTC, BCH, ETC, EOS, ADA , ETH and a large number of ERC-20 tokens
• Wallet type: Cold storage, not encrypted
• Desktop: No
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Good
• Ease of use: Very easy
• Open source: N

Get Infinito wallet

Edge

Edge’s first product, a bitcoin wallet and business directory, was launched in the winter of 2014, under the company name of “AirBitz” and has been securing millions of dollars worth of bitcoin ever since. Like many others, Airbitz was inspired by the bitcoin revolution and set out from day one to build tools that kept bitcoin users safe and in control.

The Airbitz Bitcoin Wallet was the first application of a security model we coined as “Edge Security”. By the end of 2015, we had successfully packaged up the tools that make the Airbitz Wallet awesome into a software development kit (SDK) that developers could use for their own applications. Our “Edge Security” SDK has since been integrated into top-tier blockchain projects such as Augur, Wings, and OpenLedger.

Airbitz quickly advanced from a bitcoin wallet in 2014 to a paradigm shifting data security solution and multi-currency wallet in late 2017. 

Given our company’s evolution and coining of the term, “Edge Security”, we thought it would be best to highlight this focus as the core of our brand. We look forward to the next stage of our company as Edge and invite you to join us on this innovative journey.

EDGE features

• Supported coins: BTC, BCH, LTC, ETH with a total of 12 coins are supported
• Wallet type: Cold storage, encrypted
• Desktop: No
• Mobile: Yes - iOS and Android
• Built-in exchange: Yes
• Safety: Great
• Ease of use: Very easy
• Open source: No

Get Edge wallet

Hot wallet security tips

Hot wallets are by no means a silver bullet when it comes to safety and poor management of your safety measures and vulnerabilities in the wallets core code has lead to hacks in the past and users have lost their money.

Do your research

Before trusting any wallet with your funds always do research and make sure you're using the correct website and correct application. There are plenty of scammers out there creating phishing sites and copy wallets looking to steal your cryptocurrency. Check out forums like bitcoin talk or Reddit for the latest news on any hot wallet you plan to use.

Passphrase

Your passphrase is your master key to that specific wallet and you should either store it in an encrypted document on your hard drive or flash drive or on a piece of paper you keep somewhere safe.

Private keys

Make a copy of all your private keys, and for the love of all things, crypto DO NOT store your private keys on anything tied to an email address or on cloud services. Keep it either in an encrypted document on your hard drive or flash drive or on a piece of paper you keep somewhere safe. Also, make multiple copies just in case you lose a flash drive or hard drive.

Paper wallets

If you plan on storing large sums of cryptocurrency in your wallet and don't plan to withdraw it for a while, many hot wallets offer paper wallet services that allow you to covert your finds into a unique code and keep it offline for long-term storage. This paper wallet can be stored in a safe or a safety deposit box at a bank, treat, that piece of paper like it's gold!

Drop it like it's hot

If you've found any new hot wallets or feel you use one that deserves a mention drop me a suggestion in the comments section and if its a solid lead I'll gladly review it and add it to the list.

Contact us

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Disclaimer: This article should not be taken as, and is not intended to provide any investment advice and is for educational purposes only. As of the time posting the writers may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency as all investments contain risk.

Tags: Cryptocurrency, Tools, blockchain