How to Choose the Best Bitcoin Wallet Hosting

A crypto wallet is a digital account for the storage of cryptocurrency. The same way you can store cash in your checking or savings account, you can store cryptocurrency in a variety of different ways. You can keep it simple with a hosted wallet, take control of your private keys with a non-custodial wallet or go extra-safe with a hardware wallet. Hosted wallets, however, are the most popular choice because they offer convenience and security infrastructure.

A good host wallet will handle complex blockchain Bitcoin Wallet Hosting transactions and security protocols behind the scenes, so you don’t have to worry about it. You will, however, have to trust that third party with your crypto assets. So it’s important to vet hosted wallet providers carefully and have a healthy dose of skepticism.

Choosing the best hosted wallet depends on your needs, risk tolerance and level of expertise. Look for a provider that invests in robust encryption, cold storage and insurance to protect your assets. Robust multifactor authentication, biometrics logins and activity notifications also increase safety. On the convenience side, consider features like smooth mobile apps, reasonable fees and bank integration for easy on/off ramping of fiat currency.

Software Bitcoin wallets are applications you install on a desktop or mobile computer. They allow you to access your cryptocurrency and make transactions, but they also put your private keys at risk because they’re stored on an internet-connected device that may be susceptible to malware. Hardware wallets, on the other hand, store your keys offline in a secure computer chip, making them safe from online threats and malware.

Most hosted wallets will let you add Bitcoin and other crypto assets by purchasing them directly on the platform or transferring them from another wallet. Once you’ve added your crypto, it’s easy to withdraw them as long as you follow the instructions provided by the hosted wallet provider. Withdrawals typically take a few hours to process because you must wait for the blockchain transaction to complete on the recipient’s wallet. You’ll also need to factor in withdrawal fees that can dig into your asset value.