How Do I Use a Bitcoin Wallet?
Bitcoin wallets act as a virtual wallet for your digital currencies. Just as you could put dollars, euros, pounds, and yen in your physical wallet, you can put Bitcoin, Ethereum, Litecoin, and Ripple in your Bitcoin wallet.
Some wallets featured in this list allow you to buy and sell bitcoins with an integrated platform. Others are only made for storage. There are pros and cons to keeping your cryptocurrencies online or in an offline wallet. It’s up to you to decide on the right mix of security and convenience for your needs and comfort.
How Much Money Do I Need To Invest in Bitcoin?
If you’re looking to buy Bitcoin, it’s important to understand the costs and risks involved. There is no universal minimum purchase rule for digital currencies, but some exchanges have minimum order sizes and, when you take fees into account, small purchases may not always be practical.
Examples of places you can buy small amounts of Bitcoin are Coinbase ($2), Robinhood (0.00001 BTC minimum purchase), and SoFi (minimum $10 purchase).
It’s not a good idea to put more money into Bitcoin than you can afford to lose. While many people made millions when Bitcoin skyrocketed to nearly $20,000 in 2017, the price dropped below $3,500 one year later. It then blew past $40,000 in early 2021. All of which demonstrates that Bitcoin is highly volatile.
Pros and Cons of Digital Bitcoin Storage
- Securely store Bitcoin and other digital currencies
- Ability with some to buy and sell coins to take advantage of market fluctuations
- Flexibility to keep your coins online and accessible, or offline and ultra-secure
- Some exchanges associated with these wallets charge high fees
- Setting up some wallets can be complex
- Hardware wallets require an initial cost
How Should I Choose a Bitcoin Wallet?
The best bitcoin wallet for your needs depends on your comfort with technology and your goals. Here are some of the best types of wallets for different situations:
- Beginners: Consider starting with an online wallet that charges very low fees for transactions. SoFi, Robinhood, and Coinbase are best for this group. If you have a strong investment background, SoFi, Robinhood, and Exodus are good choices.
- Experienced users: Hardware wallets offer the best security. People very comfortable with computers should have no problem navigating the additional complexities. Trezor and Ledger are suitable for this group.
- Serious enthusiasts: Consider a dedicated cryptocurrency wallet that gives you either added security or enhanced features. Coinbase, Trezor, Ledger, Edge, and Exodus are solid options.
How We Chose the Best Bitcoin Wallets
Bitcoin wallets are essential for digital currency users. For this list of top choices, we looked at over 15 different Bitcoin wallets. When choosing the best bitcoin wallets, we focused on cost, security, ease-of-use, and features helpful for typical crypto users.