Ethereum is a platform based on blockchain technology that allows developers run decentralised applications through smart contracts.
Ether, referred to as Ethereum, on the other hand, is beyond being just digital currency. It’s the “fuel” or “digital oil” for the dApps (decentralised applications) on the Ethereum network.
Like physical wallets are to fiat currencies, cryptocurrency wallets are needed to send, receive, and store digital currencies (cryptocurrencies). Most coins have their official wallets, and some third-party developers have built cryptocurrency wallets that can hold multiple cryptocurrencies.
Before anyone can interact with cryptocurrencies, you need to have a cryptocurrency wallet, and same holds true for storing Ethers.
5 Types Of Cryptocurrency Wallets
Online Wallet/Web Wallet – These are wallets accessible over the internet with a web browser. These wallets are simple to set up and use for cryptocurrency beginners, yet vulnerable to attacks.
Mobile Wallet – These are mobile software applications designed to hold cryptocurrencies. It’s usually developed to work with devices that run Android and iOS operating systems. These wallets make cryptocurrency transactions easy, most especially “on the go”.
Desktop Wallets – Also software applications for personal computers. This is to some extent considered more secure than the other two types mentioned above (web & mobile wallets). Though these wallets create private keys offline, it’s necessary to connect to the internet to have the software updated to display your actual fund (if any).
Hardware Wallets – These are special digital devices (called wallets), great for storing large cryptocurrencies you don’t need for everyday use. Of course, you can also use it for daily use, it all depends on you. These wallets offer more security on cryptocurrencies stored in them than all other types of wallets.
Paper Wallets – These wallets are also very secure. Wallet addresses and private keys needed to access the wallet are printed on a paper. This type of wallet isn’t user-friendly as there are no interfaces of its own to send and receive cryptocurrencies. If you need to make some transactions, you will need the help of Mobile, Desktop, or Hardware wallet to access your funds.
ERC20 Token Compatible Wallets
ERC stands for Ethereum Request for Comments; it’s an official protocol for proposing improvements on the Ethereum network. ERC20 defines a set of rules which needs to be met for a token to be accepted and called “ERC20 tokens.”
ERC20 token wallets are therefore wallets that store tokens that follow the same set of rules as defined above. These tokens run on the Ethereum Blockchain, and wallet addresses are always similar to that of Ethers.
Top 7 Ethereum Wallets
The Ledger Wallet is categorised as a hardware wallet. It’s one of most secure ones and can hold Ethereum, ERC20 tokens, and other tokens from different blockchain platforms. It’s a must-have for huge multiple cryptocurrency holders/investors.
The best thing about hardware wallets, most especially the Ledger Wallet is it keeps the generation of wallet address and associated mnemonic phrase/private key within the device.
Encryption on the Ledger Wallet device is so robust that it can be used on a hacked computer system without the user being at risk of losing his/her cryptocurrencies.
The main benefit of Ledger Wallet is the fact that you control your private keys.However, It’s not a hierarchical deterministic wallet, it doesn’t have multi-signature option and neither a 2-Factor Authentication.
The Trezor Wallet is another hardware wallet widely used, such the Ledger one. This was the first hardware wallet for Bitcoin.Since then, they’ve been upgrading the system to hold Ethereum & ERC20 tokens as well as other alternative cryptocurrencies.
The Trezor is sleek and can be easily carried around. But depending on how much cryptocurrencies you have on it, it’s best you keep your Trezor Wallet in a safe place.
Trezor work on the same principle as Ledger. Your private keys are secured and in case you’ve lost your trezor you can always buy a new one and import your seeds there. The Satoshi Labs team made a tutorial for that.
Same as Ledger, Trezor lets you control your private keys, they are not a hierarchical deterministic wallet and it doesn’t have multi-signature option. But unlike Ledger, Trezor actually have a 2-Factor-Authentication option.
MyEtherWallet is a platform that allows people to create, send and receive Ethereum tokens. This platform gives you total control over your private keys, in other words, you have what is required to recover your tokens on other cryptocurrency wallets.
If you generate an Ethereum Wallet on the MEW platform, you get a public and private key which you are required to protect with a secure password. You also can download a key pair file for future use which will give you access to your tokens.
What’s fun about the MEW is, it’s compatible with the Ledger and Trezor hardware wallets. You are required to plug in any of the two devices to your PC, and you’ll be able to control your funds from the MyEtherWallet web interface.
The MEW is one of the best choices for ICOs as it supports a wide range of ERC20 tokens.
The Exodus Cryptocurrency wallet is an open source software application for desktop. The app has a beautiful and easy to use interface.
The wallet supports not just Ethereum but a few other cryptocurrencies as well. This wallet also gives you total control of your cryptocurrency as private keys can be seen and stored, and users can access their cryptocurrencies even on other cryptocurrencies wallets. It’s recommended to hold only low amounts of cryptocurrencies on an Exodus wallet as your funds can be compromised.
Using Exodus, you’re in control of your private keys. Exodus is a hierarchical deterministic wallet, without a multisignature option of 2-Factor -Authentication, though they plan to implement it in the future.
To download the Exodus Wallet for your Ethereum Cryptocurrencies, click here.
Metamask is a desktop wallet/browser compatible wallet. It’s an extension for the Chrome and Firefox browsers. It’s easy to use interface makes it easy for users to switch between a test network and the main Ethereum network.
Private keys are stored on the device on which it is installed, and it can be exported anytime. Metamask is a great option, but its important to notice that it’s a web-based wallet and as any web-based wallets your fund are at risk in hacking attacks.
Coinbase (Web/Exchange Wallet)
Coinbase is one of the first and best exchanges to buy cryptocurrencies on the internet. It started as a bitcoin exchange but has since included support for Ethereum cryptocurrency (Ether).
It’s a convenient way of storing your Ethers as long as it’s available in your country. You can click this link to see supported countries.
Though this is a convenient way of transacting with your crypto coins, it’s advisable you don’t keep a lot of it on the Coinbase exchange as you are not in control of your cryptocurrencies. The private keys are hosted on Coinbase’s server and can only be accessed by them.
If this works for you, then go over to their website and Register a Coinbase account and generate your Ether address. This enables you to start sending and receiving ETH conveniently.
With Coinbase, you’re not in control of your private keys. But, Coinbase has a multi-signature option & a 2-Factor-Authentication system. It’s perfect if you need to transfer small amounts of BTC,ETH,BCH or LTC daily.
No matter the wallet you make use of, you are responsible for keeping your private keys or access to your cryptocurrencies out of reach. Anyone who’s got access to your private keys can take control of your cryptocurrencies.
That’s why its important to always secure your accounts, enable 2FA and avoid scamming domains.