Before you buy bitcoins or any other altcoins, you need a good wallet to safely store your new digital money.
It is strongly advised not to store your cryptocurrency on an exchange, only on a dedicated wallet that you own.
What does a Bitcoin wallet do?
A Bitcoin wallet lets you receive bitcoins, send bitcoins and store them for short or long periods. Nowadays many wallets have other features like markets info, trading options and more.
What are the main types of Bitcoin wallets?
Two main types are a hot Bitcoin wallet and a cold Bitcoin wallet. Each has its pros and cons. You can read more about types of Bitcoin wallets here.
Custodial vs. Non-Custodial wallets
Bitcoin wallets can also be classified as custodial and non-custodial. When using a non-custodial wallet you are the only owner of the private key (seed phrase) and no one else can get access to it.
When using a custodial wallet you have a partner that can access your private key, usually another company. The risks are clear, since this other party can bankrupt or simply steal your coins.
Full node wallets hold a full copy of the blockchain to validate every transaction. Because it is becoming progressively bigger, SPV wallets (simplified payment verification) don’t hold a full copy of the blockchain. SPV wallets offer a simpler and faster option.
Why hardware wallets are considered the best option?
Hardware Bitcoin wallets have some major advantages over software wallets, mainly the fact that your private keys are stored offline. Read more about hardware wallets here.
Which wallet should I choose?
Web Wallets are very convenient, but keep in mind that your private keys are stored by a third party. With a desktop or a mobile Wallet your private keys are kept only by you, however they are conected to the internet and can be hacked. Those two types are mostly good for keeping and dealing with small amounts on a daily basis.
It is strongly recommend using a hardware wallet. Hardware Bitcoin wallets are the safest wallets available. Ledger Nano S and TREZOR are currently the finest hardware wallets on the market, and both support nearly two dozen cryptocurrencies.
The Ledger Nano S is currently one of the best if not the finest hardware wallet with a screen. It can be used on any desktop computer or Android smartphone.
TREZOR (lunched on August 2014) was the first Bitcoin hardware wallet that offered secure cold storage plus the ability to spend coins with the convenience of a hot wallet.
Now you can buy bitcoins
After you choose and install the best wallet for you, you can learn about the common payment methods for buying bitcoins.