What is the best crypto wallets?

James Rodriguez James Rodriguez updated on 2022-08-08

When investors start trading, buying and selling cryptocurrency and NFTs they need a secure place to store the passwords to their crypto assets. 

Did you know that picking the right wallet can provide you with greater security and save you on fees?

This guide breaks down how to pick the best wallet for crypto, explains what they are, how they work and all your crypto wallet questions.

What are the best crypto wallets?

The best crypto wallet in 2022 heavily depends on your intended use. 

CategoryBest crypto wallets
Best wallets for beginners
  • Binance (desktop and mobile)
Best hardware wallets
  • Trezor One
  • Ledger Nano X
Best desktop wallets
  • Exodus
  • Binance
  • Coinbase
Best mobile wallets
  • Mycelium
  • Exodus
  • Trust
Best wallets for iPhone
  • Binance
  • Trust
  • Coinbase
  • VirgoCX
Best wallets for Android
  • Binance
  • Trust
  • Coinbase
  • Bitbuy

Best crypto wallets in Canada
  • Binance wallet is one of the best crypto wallets for beginners who want a stable platform to walk them through the process. This will provide you with an account, a key and a marketplace to buy and sell on. Binance wallet can be used as a mobile or desktop wallet.
  • Trezor One and Ledger Nano X are both popular hardware wallets as they sell the hardware storage device and the software together. They also provide instructions on setting up the hardware device and creating the recovery passphrase for the private keys. 
  • Mycelium, Exodus and Trust are all some of the best crypto mobile wallets with strong communities of traders that use them as well as up-to-date security. Remember mobile wallets are the least secure form of crypto wallets.
  • Exodus, Binance and Coinbase offer some of the best desktop wallets. 
  • One of the best crypto wallets in Canada is VirgoCX, which offers a mobile wallet and is hosted in Canada. 
  • Many people use crypto exchanges directly on their smartphones. The best crypto wallets for iPhone are Binance, Trust and Coinbase as they are all supported in Canada. They have security to protect users' account information and assets. The best crypto wallets for Android have some overlap with Binance, Coinbase, Bitbuy and Coinberry. All app-based crypto exchanges have varying costs and fees. Users should research apps before making an account.

You can compare cryptocurrency exchanges, including the ones about right here. Start investing in crypto today.

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Do you still have some questions about crypto wallets? We explore the different types below.

What is a crypto wallet?

A crypto wallet, or cryptocurrency wallet, is used to store public and private keys for the purpose of securely carrying out cryptocurrency transactions. It can be a physical device or a program. A crypto wallet also allows for encryption and can be used to create sign-in requirements to protect crypto assets. A crypto wallet does this by creating both private and public keys for different purposes. Keys are created by generating a theoretical or random number that can then be used to access and transfer cryptocurrency. Understanding the difference between private and public keys is important.

What is a private key?

A private key is created using a cryptographic algorithm and should not be shared. This key is used by the owner of the crypto wallet to securely access and send cryptocurrency. 

What is a public key?

From the private key, an owner can create a public key using the cryptographic algorithm. This public key can then be shared with a third party so that they can send you cryptocurrency without you giving access to the wallet. 

How does a crypto wallet work?

A crypto wallet works using blockchains and keys. Blockchains are digital ledgers or records of sale. Every time a digital currency is transferred using a crypto wallet, that transaction is recorded in a blockchain. 

Wallet owners use their keys to access their cryptocurrencies. The blockchain combined with the keys creates a secure system of transfer. The keys prove ownership and the blockchains provide proof of sale. Keys made be help in hot or cold wallets. 

What are hot wallets?

Hot wallets are any form of crypto wallet that has a direct connection to the internet. In other words, hot wallets are always online.

Examples of hot wallets are:

  • Web-based crypto wallets
  • Mobile crypto wallets
  • Desktop crypto wallets

Hot wallets are convenient because of their ease of use. By having a hot wallet that is already connected to the internet, you can make a crypto trade or purchase almost instantly. To do this with a cold wallet you would first need to connect your device to a computer, and then move your cryptocurrency into a separate hot wallet that is connected online.

With convenience comes risk, hot wallets are more susceptible to online hacking and theft. Having your crypto wallet connected online means that there’s always a chance someone could access it through the internet, break your security and steal your cryptocurrency.

What are cold wallets?

Cold wallets are crypto wallets that are not directly connected to the internet. They will usually be on a device that has no online capabilities itself. Security is the main benefit of cold wallets.

For example, an external hard drive, USB drive, or another portable device can be a cold wallet. The device will then be connected to your computer and a key will be used to transfer the desired amount from the cold wallet to the computer. 

If there are any malicious programs installed on the computer they would only be able to access the transferred amount and not the full amount on the cold wallet. This means that it is much more difficult to steal the cryptocurrency on it without stealing the physical device. Even if the device were to be stolen, the cryptocurrency would still have to be accessed using a key. 

Many people trading and storing large sums of cryptocurrency will have both a hot and cold wallet. The majority of their cryptocurrency will be on the cold wallet and they will use the hot wallet to make trades and transactions in order to protect the majority of their cryptocurrency.

How do I get a crypto wallet?

There are many options for creating a crypto wallet. It has become incredibly easy to get into crypto investing. Online crypto exchanges have made crypto trading similar to stock transactions. 

To create a crypto wallet you first need to decide what kind of crypto wallet you want: hardware, desktop or mobile wallet. We examine them below:

What are hardware wallets?

Hardware wallets are cold wallets contained on a hardware storage device. 

These devices may come with associated software if you buy a name-brand hardware wallet. If not, you will need to get separate software if you buy a generic storage device. You will then need to download the software onto your computer, copy the recovery passphrase for your private keys and connect the device to your computer. 

For first-timers, it is easiest to buy a hardware wallet that comes with an associated software as it will do all the small steps for you.

What are desktop wallets?

Desktop wallets are apps that run on your computer and allow you to access your cryptocurrency. 

A desktop wallet is slightly easier to use than a hardware wallet as you simply need to run the software on your computer. It will start the process for you. Once again, you will need to copy a passphrase and private keys. Many of these programs can also be used on a hardware wallet for added security.

What are mobile wallets?

Mobile wallets are crypto wallet apps that run on your iPhone or Android. 

Mobile wallets are the easiest wallets to set up, but they provide the least security. To create a mobile wallet, simply choose the desired cryptocurrency wallet from your phone's app store download and create an account. You will be able to start accepting and trading cryptocurrency almost instantly. It is recommended that you backup your mobile crypto wallet through the app. This will be a 12 to 24-letter passphrase that will act as a recovery phrase if you lose or break your mobile device.

Once you decide between hardware, desktop and mobile wallets, the providers will help you to get set up.

Just remember that there is a difference between a crypto trading account and a crypto wallet. Crypto trading accounts act similarly to stock accounts by allowing you to buy and sell cryptocurrency as you might with stocks. The drawback is that you never hold the actual cryptocurrency yourself. Instead, you just have the account with a parent company that is actually holding the cryptocurrency.

Regardless of the type of crypto wallet that you chose, you will be able to use it to buy, sell and trade cryptocurrencies from the top crypto exchanges.

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What is the safest crypto wallet?

The safest crypto wallet is a cold/hardware wallet.

This means a crypto wallet stored on a device separate from your computer that requires a private key to transfer cryptocurrency to another wallet or a secure platform where you will provide a public key to access the cryptocurrency amount you are trading. This separate device and private key provide an extra layer of security when making crypto transactions. 

How much does a crypto wallet cost?

Some crypto wallets are free through established platforms such as Binance wallet. Others can range up to a couple of hundred dollars for a branded hardware wallet such as Trezon One or Ledger Nano X or a crypto software program. 

As you can see below, most crypto wallets have a cost. Hardware wallets will have a direct cost for the device itself. Desktop and mobile wallets may be free upfront, but exchanges have translation fees built into the platforms. 

WalletTypeCosts
Binance walletDesktopTransaction fees
Ledger Nano Xhardware$59-179
Coinbasemobile/desktop exchange or desktop walletTransaction fees
Trezor onehardware$50-270
Crypto wallet costs

How do you cash out your crypto wallet?

There are several ways of cashing out your cryptocurrency. It depends on what wallet you are using and how it's being held. Cashing out cryptocurrency has become easier, but still has its risks and fees.

  • Centralized exchange: If you have your crypto wallet in a large crypto exchange such as Binance, Coinbase and Gemini, they will convert your crypto to cash the same way you might convert Canadian Dollars to Euros. To do this you have to use their platform, convert at their rate and pay transaction fees. Once you complete the transaction, the currency of your choice will be deposited into your account, and then you can transfer it to a linked bank account. This is one of the simplest and most secure ways to cash out your cryptocurrency, but it requires you to pay fees to a platform and use its platform.
  • Peer-to-Peer crypto exchange: Peer-to-peer (P2P) uses a decentralized platform so that two individuals can swap assets at an agreed-upon price either for a currency or cryptocurrency. The platform acts as a middle man, swapping the goods seamlessly for a transaction fee.
  • Direct from a wallet: Some platforms such as Trezor and Ledger let you sell directly from your crypto wallet for fiat as long as you use their interface. The downside is they only buy Bitcoin at this time.

What are hosted wallets?

A hosted wallet is currently the most popular and easy-to-use crypto wallet. When you buy cryptocurrency through an app, you are using a hosted wallet. 

This means that a third party is actually holding the crypto for you. You are using an account to trade the cryptocurrency through their platform. It is similar to how a bank holds and transfers money for you. The benefit is that the host is providing the security for your accounts and creating the platform that you are trading on. The downside is that all your transactions may be tracked and if the host gets hacked your information could theoretically be leaked. 

What are self-custody wallets?

Self-custody wallets give you complete control over your crypto wallet. This means that you are responsible for your private and public keys as well as making sure your transactions are secure. The benefit is increased freedom with your trading and assets but the cost is that you are responsible if your computer gets hacked. You can also be potentially scammed while using other platforms to buy, sell or trade.

Once you pick the best crypto wallet for you, purchase and sell cryptocurrency on the top crypto exchanges.

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