Everscale Partner
Of the 18+ million mined bitcoins, about 27% are not in circulation, most of which is most likely lost. There are several reasons for this: some of these bitcoins belong to the deceased owners, some belong to Satoshi, but most are lost due to money management errors. And therefore, the value of crypto wallets is growing every day, because with every lost BTC, the value of the remaining bitcoins is growing.
The first crypto wallet was developed by Satoshi, and it was very simple: it allowed to generate new addresses and send BTC to other people. No special measures were taken to protect or restore private keys, and you could easily enter the wrong address and send coins to the wrong recipient. But those were the early days when people did not think that they were losing something valuable – a maximum of a few cents. But when Bitcoin’s value began to grow gradually, holders began to consider it as a commodity that can be traded.
What should a modern crypto wallet be equipped with?
The first exchange was launched in 2010 and was called Bitcoinmarket.com. The next 2011, Mt.Gox was launched, and people began to use it instead of a wallet. Hacking Mt.Gox (when users lost almost 650,000 BTC) taught us not to store cryptocurrency on exchanges, and the demand for safe crypto wallets increased. Over time, many new wallets, such as Exodus and Jaxx, have appeared, with support for different currencies and new security options. Today there are many competing wallets for any currency.
In the early days of cryptocurrencies, most users were tech savvy. Cryptocurrency was not popular with the masses, but rather was a technology for geeks and developers. Thus, there was no need to create simple tools for Bitcoin users. To satisfy the demand, it was enough to offer any software for storing or sending coins.
However, now that more and more people are starting to use cryptocurrencies, developers are faced with new challenges: how to simplify such a complex system as cryptocurrency? Users don’t care how the cryptocurrency works, just as they don’t care how online banking or YouTube works, they just use it.
For many, the most important rule is that cryptocurrency software is very simple and does not burden the user with its technologies. What are the criteria for a modern wallet?
Mobile Support
There are currently more than 5 billion mobile phone users in the world. The days of home PCs are in the past, and the mobile-first paradigm requires a crypto wallet to have a mobile version, preferably an application, and not an adaptive site.
Easy to use interface
Each user should be able to send cryptocurrency by copying and pasting the address or by scanning a QR code. All payment applications today are very convenient for users and allow you to send money in a few clicks / taps, and in order to remain competitive, a crypto wallet should require no more steps for this.
Ease of access
Opening an application should also take no more than a few seconds. This may require a short PIN, FaceID, or fingerprint.
Support for many cryptocurrencies – Now this is a standard requirement, although a few years ago it was an exotic option.
In addition to these features, there should be many security options to expect from an application dealing with our money:
Exporting private keys to your money
It would seem logical, but not all popular wallets support this.
Device Encryption
To ensure that no one enters the device and does not recognize your private key.
So, we have defined the rules. What wallets satisfy our needs?
For the purposes of this article, we have chosen Coin Wallet, Jaxx, and Freewallet. All of them are pretty good. But our task is to determine which one meets the greatest number of criteria for a modern cryptocurrency wallet.
What should a modern crypto wallet be equipped with? First of all, you can compare them by the number of users or settings. Coin Wallet users generated 20 million wallets that have already completed transactions for $ 120 billion. Freewallet has 3 million users. Jaxx has more than 700,000. Assuming that each Coin Wallet user generated 2 or 3 wallets, he is far superior to the others in the total number of users. Nevertheless, all these wallets are very popular, so we should choose based on more important indicators.
How are private keys stored?
What should a modern cryptocurrency wallet be equipped with? Freewallet does not give you a private key to your cryptocurrency at all, since it is a custodian service. You send him cryptocurrency, and he promises to keep it for you. Jaxx cannot make such promises, as he has already given $ 400 million to his hackers. This happened in 2017, when hackers were able to gain access to user funds by obtaining a backup seed phrase and, as a result, restoring the access key, even despite the PIN code set.
The Seed phrase was not encrypted, so it was enough for 20 seconds to connect to the device via a network connection to steal all the necessary data. As a result, the loophole was closed, but it is not too comforting for those who have lost money.
On the other hand, Coin Wallet did not have such security incidents, and it protects the private key with a seed phrase stored in encrypted form. Coin Wallet uses AES-256 encryption, which could not be cracked with active public testing. In addition, the encryption of the passphrase BIP 39 is used, which (as far as we know) makes theft of the phrase almost impossible even when gaining access to the device.
How easy is it to use a wallet?
What should a modern crypto wallet be equipped with? All three wallets allow users to set a 4-digit PIN and use it instead of entering a private key, which is much simpler and safer. The interfaces of all three wallets are intuitive, but if we talk about functionality, then Freewallet and Jaxx are much more limited in comparison with Coin Wallet. The problem is the number of cryptocurrencies supported.
Coin Wallet supports more than 20,000 different tokens – almost everything that has ever been launched on the blockchain. Jaxx and Freewallet support 30-50 popular cryptocurrencies and tokens. For many, this is enough, but not for those who like to buy tokens with a small capitalization.
In addition, they all allow the exchange of coins and tokens inside the wallet itself. Freewallet uses its own algorithm for this. Jaxx allows instant sharing through Shapeshift. Coin Wallet offers even more: it has partnered with two exchanges, Shapeshift and Changelly, so you can always exchange currency if necessary.
All wallets in question are ad-free. Initially, there was an advertisement from Coin Wallet from Facebook, but when Facebook banned all cryptocurrency ads, the Coin Wallet team removed ads from wallets for iOS, Android and the web, as well as third-party tracking. Now the wallet is completely private, in compliance with all industry security standards.
Coin Wallet has also since taken some additional measures to ensure users privacy and security. Coin Wallet never reuses addresses, generating a new one for each transaction, and supports a VPN and Tor browser, which allows you to forward transactions through a random IP address. If you want to remain anonymous, then this is the wallet for you.
Despite the concerns mentioned, all three wallets are good and have a loyal user base. Some conservative users may prefer Jaxx because it has the best options for everyday use, it supports most major cryptocurrencies and allows integration with hardware wallets. Freewallet for those who are not able to take care of their own security and prefer custodial solutions that store your funds for you.
And for those users who want to store thousands of tokens in one place, independently keep their private keys and easily exchange their coins, Coin Wallet will definitely like it. All these wallets are free, holistic solutions for storing and managing cryptocurrencies, so the choice is yours.
