The term wallet is actually not new. You probably have used some kind of folding case to hold your money or plastic cards in the past. Crypto wallets are based on this similar idea, only that they store the passkeys for your crypto transactions instead of holding physical cash. With the number of these facilities rapidly increasing, finding the best one can sometimes be tedious.
Actually, Fortune Market Insights highlights that the global crypto wallets market revenue has already passed the US$ 1,505.9 million mark and is on its way to hit US$ 3,675.4 million by 2033. This shows a growth of about 9.3% CAGR within ten years only. So, in this article, we try to look at the reasons behind this growth and factors you can consider when choosing the best crypto wallet. Read on to learn more.
Why are more people turning to crypto wallets?
Have you ever thought about the possibility of keeping multiple cryptocurrencies from several blockchains on a similar wallet? This is just one of the many benefits of crypto wallets. The Best Wallet crypto storage, for instance, supports thousands of crypto on more than 50 major blockchains. This way, you can always be sure to manage and trade all your digital currencies on the same platform.
As you might actually know, supporting more than one crypto can be quite cost-effective. Do you really remember the early days of NFT when those who owned collections for sale only used ETH for minting? If you do, you can relate to how the ‘gas’ fees were quite high, so creators started using other alternatives like Solana.
This is what actually, in part, resulted in multicurrency crypto wallets that can support such demands. Plus, it just is sometimes good to be able to store several coins – especially when you can take advantage of price differences of a particular asset in different markets.
And do you know that there are some wallets that can handle digital forms of fiat money as well? Why wouldn’t you want to keep your dollars alongside your Ethereum tokens? And, for those who want to diversify their portfolio, multicurrency crypto wallets can be very helpful.
Considerations for choosing the best crypto wallet
Checking the security of the wallet can actually be a great way to get you started. You may want to consider whether the wallet has things like 2FA to strengthen its security. By the way, do you actually know that 2FA alone can reduce the risk of exposure to targeted attacks by about 99.9%? Plus, you can check whether the wallet stores passwords offline or not.
According to Jeff Owens, the CEO of Haven1, a Layer 1 blockchain that addresses on-chain hacks, using wallets that store private keys offline can be one of the most secure options. PIN protection and recovery seed phrases are other features that you can look for.
It might be noteworthy to mention that as much as ensuring security is important, you need to balance that with convenience. This is where soft wallets beat hard wallets. But again, paper wallets carry the risk of being physically damaged even though they aren’t as susceptible to cyber-attacks. If you hold large sums of crypto, you may want to consider paper wallets as they are less susceptible to cyber-attacks.
Just recently, in 2023, Chainalysis conducted a survey that found approval phishing scams to be rampant. Here, scammers can trick you into signing a malicious transaction that grants them access to your wallet. Can you imagine that such incidences led to losses of about $374.6 million worth of crypto that year alone? That’s why it is important to double the destination of your transactions a couple of times to minimize the chances of mirroring scams.
What are other features that you can consider?
As the number of security threats increases, developers are turning to technology to develop innovative solutions to reduce exposure. And these are some of the features you should be looking for in a crypto wallet.
Let us take the example of biometric authentication. Are you aware that, according to a recent Verizon report, about 75% of data breaches resulted from human error, stolen credentials, and misuse? To reduce the chances of such events, you can inspect a wallet to see whether it allows biometric authentication.
Smart contracts can really help if you want to minimize the risk of human error. For instance, multiparty computation (MPC) can divide private keys into several parts and perform transactions automatically, offering more security.
The bottom line
Crypto wallets are among the components of your cryptocurrency toolbox that you would want to pay attention to. But now that these tools have become a legion, it may make sense to do some level of research before one chooses any. The good thing is that thanks to the internet, all you need to do is pick up your phone and search for reviews online.
Here in this article, we only look at a few features like security to start you off – but there are many others. And, of course, the opinions presented here are purely based on the author’s research and may not necessarily reflect the site’s position.
