How to get a Bitcoin wallet
UPDATE 12th June 2019: We have prepared an amazing and comprehensive guide on how to choose the best Bitcoin wallet for your needs, which nicely complements the content of this article. Make sure you check it out!
There are several options when it comes to Bitcoin wallets, but the first thing to understand is that the wallet doesn’t ‘contain’ your bitcoins in the way that a physical wallet can contain notes or coins. Instead, the wallet stores the information needed to establish what currency you own, such as your private key, public key and any Bitcoin addresses that you create.
In simple terms, your private key is what allows you to spend your coins, and your public key or addresses are what allow you to receive coins. Your private key must remain secret because anyone who has it could spend your coins. That’s why it is important that your wallet is secure.
In addition, your wallet will also store a list of incoming and outgoing transactions. Finally, it will store user preferences, which vary depending on the type of wallet you are using and the features it has available.
A ‘cold storage’ wallet is one that is not connected to the internet, thereby protecting your coins from viruses or hackers. A wallet that is connected to the internet is known as a ‘hot’ wallet.
There are five basic types of Bitcoin wallets:
1) Desktop wallets run on your desktop or laptop computer. That’s helpful because those computers aren’t as easy to lose as a smartphone or a USB stick, but they are still vulnerable to theft or technical failure – either of which means you lose access to your funds.
2) Mobile wallets run on your smartphone or tablet. These too are vulnerable to theft, loss or hardware failure but they offer the benefit of being portable, so you can use them wherever you want to.
3) Web-based wallets are accessed through your browser so you can get to them on any device, and they are provided by online companies whose security systems might be stronger than yours. However, they are also a bigger target, so if they are hacked or if they have made a mistake, then your funds could be stolen.
4) Hardware wallets store your funds on a physical device that you connect to a computer online when you want to spend your coins. They most commonly plug-in via a USB device and they are very secure. However, they also cost money – anything up to $200.
5) Finally, there are paper wallets, which you generate and print out. Being offline and not computer devices, these are immune to hackers. They are, however, vulnerable to fire, theft, water damage or accidentally being thrown in the bin.
Once you have decided what you want, getting a Bitcoin wallet is simple. The Bitcoin website has a list of wallets, which can be broken down by type. If you choose desktop wallets, for example, you’ll see a list of icons, underneath which are links to download the wallet of your choice for Windows, Apple or Linux computers. Similarly, the mobile wallet category gives options for Apple iOS, Android or Windows Phone devices.
Click on an operating system and the website gives you an overview. For example, BRD is described as “one of the easiest wallets for new Bitcoin users”. Below that, you’ll find a list of the key features and a link to the download page.
If the Bitcoin website offers too many choices, then you can always take a look at those websites that have rounded-up a small number of strong contenders. Techradar, for example, recommends its five favourites and offers the pros and cons of each one.
One option not included on Bitcoin’s wallet page is the paper wallet, which is in some ways the ultimate cold storage wallet. Getting a paper Bitcoin wallet is very straightforward. You need to create a private/public key pair that never goes online – at least, not until you’ve decided to spend your coins.
There are several paper wallet tools online, such as the Bitcoin.com one. Visit the page and save it somewhere on your computer. Then close the page in your browser and disconnect your computer from the internet. Next open the saved version of the web page and follow the instructions to create your wallet. This usually means moving your mouse around to create the random data that the page will use to generate your key.
When that is done your wallet will be generated. You’ll see the private key on one side and the public key opposite. Print out your wallet and store it somewhere safe. If you have a fireproof safe then that is a good option. If you are worried about someone accessing the private key and then putting the wallet back, you could seal it in an envelope and sign your name across the seal. It won’t stop someone accessing the wallet but you’ll know if they have.
Close the browser again – you might want to clear the browser history and cookies to be extra safe – and then you can connect to the internet and reopen your browser. You now have a private key that was created with your computer entirely offline and which you will only put online when you want to spend the coins in that wallet.
You can add funds using your Bitcoin address and when you are ready to spend the coins in that wallet you simply need to import your private key into a new wallet. Not all wallets support private key imports so check first.
There are pros and cons of every Bitcoin wallet. Which one you use depends on what you need. Many people have several of different types which they use for different purposes. For example, you might store the bulk of your coins on a hardware or paper wallet, for maximum safety, but transfer smaller amounts into web and mobile wallets so that you have access when you need it.