If you want to buy, sell, or trade cryptocurrency then it’s important to get a crypto wallet where you can store the private keys for your digital assets, which are used for authorizing transactions. However, there are various crypto wallets to choose from, and they are certainly not all the same. The two main types of crypto wallets that you will usually be able to choose from are software wallets and hardware wallets. Before you set one up, keep reading to find out more about what each wallet offers to determine which will be the best option for you.

Why Get a Crypto Wallet?

First of all, why is a separate crypto wallet needed when you can simply store the cryptocurrency that you have invested in on an exchange like OKX? The truth is that no matter how many security steps the exchange has taken to keep your money and personal information safe, there is always the risk of cybercrime whenever you do anything online. Because of this, the additional risk of storing crypto in an exchange is simply not worth it for many people. If the exchange is hacked, there is a real risk of your information – and your cryptocurrencies – being stolen.

Software Wallets

As implied by the name, a software wallet is a fully digital cryptocurrency wallet. They are usually available in the form of an app or a software program that you can install on a desktop PC, smartphone, laptop, tablet, or another digital device. They are the most popular wallet type and offer a wide range of useful security features to keep your cryptocurrency safe. You will need to choose a wallet that supports the coins you wish to invest in. If necessary, look out for a software wallet that comes with additional features like staking or even the ability to buy and sell cryptocurrency directly via the app or software program.

Hardware Wallets

A hardware crypto wallet is a physical device that you will use to store your private keys. They are usually small and portable, such as a pen drive. A hardware wallet might be the best option for you if you want the highest possible level of security. Unlike software wallets, which are always at some risk of remote hacking, hardware wallets do not face the same security issues. They are the best option to store your private keys completely offline and can be connected to your desktop or laptop if you need to perform certain functions.

Choosing the Right Option for You

If you want to invest in cryptocurrency, then setting up your own crypto wallet for storing your private keys is a key step in the process. Whether a software or hardware wallet is the best option for you will depend on your personal preferences and requirements. Hardware may be ideal for you if you want top security levels, while on the other hand, if you want your wallet to perform a range of additional functions, a software wallet might be a better option.

Before investing in cryptocurrency, understanding the difference between hardware and software wallets and choosing the right option for you is essential.