Ethereum is currently the leading smart contract blockchain network, and it is consequently the most preferred network for hosting decentralized applications (Dapps) and NFTs. The Ethereum network's robust growth has resulted in massive demand for ETH and other tokens supported by the blockchain.

The Ethereum network will likely continue experiencing impressive growth as more people buy Ethereum, especially with the transition to Ethereum 2.0. In addition, more people are embracing cryptocurrency mainly due to NFT's and decentralized finance (DeFi). Therefore, the chances are that you will interact with the Ethereum blockchain at some point, and for that, you will need an Ethereum wallet.

Many cryptocurrency wallets are compatible with the Ethereum blockchain network. This guide will help you identify the different wallets and hopefully make it easier for you to choose the one that suits your preferences. It is essential because the internet of value will be decentralized, and thus Ethereum wallets that can interact with the rapidly growing DeFi ecosystem are essential.

What to Look For in an Ethereum Wallet

Not all Ethereum wallets are created equal. Before setting up a wallet, you must consider various factors like the type of custody, different digital currencies supported, security features, types of devices supported, software or hardware, and many more. Here are some things to consider when selecting an Ethereum wallet.

Private Keys

One of the reasons for the existence of cryptocurrencies is so that people can take back control of their finances and data. The traditional banking system is custodial, which means they hold your money for you. Unfortunately, the traditional financial system is set up such that banks have too much power over the system, ultimately creating a ‘man-in-the-middle’ risk. Unfortunately, sometimes that power is abused, and the bank's customers end up paying the price, such as when a bank run or institutional collapse occurs.

It would help if you prioritized Ethereum wallets that give you control of your private keys, thus allowing complete control of your crypto portfolio. However, note that going down this road will require you to exercise more responsibility for your money, which means you should take the necessary measures to protect your wealth. This includes secure storage of your private keys because losing them means losing access to your digital assets.

Ease of Use

An ideal Ethereum wallet should be intuitive and easy to use. There is a bit of a learning curve when using DeFi, but it should not be too technical; otherwise, the experience will be diluted. Self-custody should not be tedious, and one way to encourage the use of crypto wallets is through an intuitive user interface.

An Active Developer Community

A cryptocurrency wallet with an active developer community is preferable for security and operational reasons. Ethereum wallets are not exempt from technical problems or exploits. A development community ensures that the wallet always functions as intended and upgrades every once in a while, boosting the wallet's security level as well as its’s ease of use and feature set. Those upgrades may include security updates that maintain the integrity of the wallet. This is important because wallets are the only point of access to your cryptocurrencies other than a CLI, which non-technical users might not be too familiar nor comfortable in engaging with .

The developer community also ensures that the app or hardware wallet is always running smoothly. When bugs or any unnecessary abnormalities take place, the devs can usually provide rapid restoration of services.

Compatibility

The decentralized landscape features hundreds if not thousands of the best DeFi platforms. Projects are working towards facilitating an internet of blockchains, which means interoperability will be a thing in the future. However, this also means users will need crypto wallets that support inter-blockchain interaction. An ideal Ethereum wallet should facilitate an easy exchange with different blockchain networks such as Solana for example.

Backup and Restore Features

Imagine a scenario where you have a wallet installed on a device such as a phone or a laptop. 

Losing that device might be a significant inconvenience. For example, your laptop or phone might be stolen, damaged, or even suffer software failure, leading to the loss of your crypto holdings.

Some wallets have a backup feature that allows users to access their cryptocurrencies even if the initial device hosting their crypto wallet gets lost or damaged. It is also a good idea to look into the security measures implemented by the developers. Understanding this security level brings additional peace of mind, especially when you're planning to store more significant amounts of value in the form of crypto and NFTs. 

Types of wallets

Cryptocurrency wallets come in many forms, and understanding the different types is essential in selecting your ideal Ethereum wallet based on your needs and uses. Here are the various categories to choose from:

Software wallets

These are the types of cryptocurrency wallets that can be downloaded on PCs or phones as applications. Most of the world's population have access to the internet mainly through their mobile devices, so having wallets in an app makes much sense.

Most of the available software wallets allow crypto holders to trade one crypto for another within their interface while also providing other services such as price tracking, staking, news and facilitating interaction with other decentralized networks. In addition, these wallets should have a heavy focus on security since they can be easily connected to the internet.

Hot Ethereum wallets vs. Cold Ethereum wallets

The difference between these two wallets is their connectivity. Hot wallets are crypto wallets connected to the internet, while cold wallets are the type of wallets that are not connected to the internet. Cold wallets are considered safer than their counterparts because 3rd party sites cannot access them offline.

Cold wallets are the ultimate wallets for those who want to hold their digital assets in the safest way possible. However, people may use both depending on their strategies. For example, many traders have chosen to store their cryptocurrencies on cold wallets when executing long-term crypto investments while also using hot wallets for short-term investments.

Web Wallets for Ethereum

Web wallets exist in the form of extensions on browsers such as Brave or Chrome. These chrome extension web wallets can easily be connected to the internet, which classifies them as hot wallets. One of the most significant advantages of using such a wallet is that you can easily access your digital assets and move them across multiple DeFi platforms with ease. Unfortunately, the connectivity also means web Ethereum wallets are not the safest crypto wallet type out there. Most of the devices hosting the browsers on which web Ethereum wallets are installed are connected to the internet most of the time, unlike cold wallets, and this means they are at a higher risk of malicious attacks.

Desktop Ethereum wallets

These are the types of wallets that only exist as software that can be installed on a PC. However, users should note that PCs are often prone to malware, and thus users should consider such risks and explore solutions to secure their crypto holdings if they choose to use such wallets.

Mobile Ethereum wallets

Just as the name suggests, they are crypto wallets installed on mobile devices—billions of people worldwide own phones. We carry them wherever we go, and they are a window through which we access the rest of the world. It is thus no surprise that mobile wallets are a sensible way to go because they provide easy access to digital currencies no matter where you are as long as there is an internet connection.

Wallets with a mobile app can potentially become the most common type of crypto wallet because they are often easy to use, and they offer many conveniences, especially for beginners who are changing fiat into Ether for the first time. 

Unfortunately, scammers have also crunched the numbers, which may explain why there are so many scam wallets. Therefore, conduct some research before you download a particular mobile wallet to ensure that you do not become a victim of scammers.  Also, it's a good reminder to add on extra security protocols such as two-factor authentication.

Hardware Ethereum wallets

Hardware crypto wallets are small devices resembling USB flash disks that are used for crypto storage. These types of wallets are custom-made to facilitate full custody of digital assets and private keys. They are considered the safest method of holding cryptocurrencies because they are not constantly connected to the internet which makes it increasingly difficult for hackers to break. This also means they are categorized as cold wallets.

Although hardware Ethereum wallets are highly secure, they are not the most convenient type of crypto wallets. Users have to connect them to other devices such as PCs, which is not the most liquid option. However, this can also be seen as a benefit as they allow users to connect the hardware device to their favorite web, desktop, or mobile wallet. A potential downside to hardware wallets is that they can be pricey, but that is the price that you pay for complete control over your wealth. We always recommend using a hardware wallet whenever possible!

An updated list of the best Ethereum wallets

Some wallets are noteworthy for every category above. Here are some of the best Ethereum wallets on the market (updated for 2022).

Ledger Nano X

It is one of the top hardware wallets for crypto storage, and you have to part with $119 if you wish to own one. However, the Nano X resembles a flash drive and is packed with useful features such as an easy-to-use interface with various valuable features. For example, it has Bluetooth connectivity, allowing users to connect to other smartphones or PCs. It also features a desktop app called Ledger Live, facilitating crypto transactions once the Ledger Nano X is connected via Bluetooth.

The Ledger Nano X wallet is one of the best and safest crypto wallets, and it is ideal for users who want to store Ether and hold their wealth in a wallet that upholds a high level of security and usability. This Ethereum hardware wallet is also capable of storing multiple ERC-721 and ERC-20 tokens as well as a wide variety of tokens native to other blockchains such as Bitcoin, Solana, Cosmos, or Polkadot.

Ledger Nano S

The Nano S is a more affordable alternative which means it has fewer features than the Ledger Nano X. However, the Nano S still manages to deliver a great experience. It is more affordably priced at $59, which is half the price of the Ledger Nano X. They both have some similarities, such as the USB stick appearance and the ability to connect to a device like a PC. Once connected, users can store and access their cryptocurrencies in the Ledger Nano S through an intuitive app to buy or sell digital assets. It also can store multiple cryptocurrencies, but with a total capacity of 3-4, this is far less than the Ledger Nano X.

The Ledger Nano S wallet is highly secure, easy to use, and it happens to be one of the best Ethereum cold wallets out there. Both the Ledger Nano X and Nano S are developed by Ledger, a company with a long and successful track record as well as a strong developer team behind it.

Metamask

Metamask is one of the most innovative and popular Ethereum wallets out there. It exists as a browser extension for Chrome and Brave browsers.

Another essential feature that Metamask offers is easy interaction with DeFi platforms such as decentralized exchanges. For example, users can connect to DEXes via their Ethereum address to swap tokens and several other altcoins within their wallets. Metamask also has a simple and intuitive user interface that makes it easy to navigate the decentralized finance landscape.

Metamask stores the user's private keys on the device on which it is installed, thus ensuring a high level of security. However, users are responsible for the safekeeping of their seed phrase, which is vital for recovery. Metamask can easily be connected with a hardware wallet such as a Ledger Nano S or X, which adds another layer of security.

Trezor Model T wallet

This is another hardware wallet that supports the Ethereum network and exists in a USB stick form factor. The Trezor Model T wallet is one of the most advanced cold storage wallets and, therefore, one of the safest wallets. It stores the user's private keys within itself, making it highly secure, and it features a screen through which users can input their login info and confirm all their transactions. It also supports the storage of a variety of altcoins.

The Trezor Mobile T wallet is a bit pricey at $170, but it is still a good deal considering the security measures and features of the package.

Trezor Mobile One

The Trezor Mobile One is a more affordable offering from the Trezor team, moderately priced at $59. It also features a screen just like its bigger brother. However, its offerings are not as comprehensive yet deliver a highly secure experience. In addition, it is easy to use and supports Ethereum-based digital assets. It can also be connected to Linux, Mac, and Windows operating systems, thus providing adequate flexibility to its users.

Atomic Wallet

This is one of the best crypto wallets for holding ETH and ERC20 wallets. In addition, it is one of the few Ethereum wallets that allow users to buy or store ETH using a bank card. The Atomic Wallet was also designed to facilitate atomic swaps to swap cryptocurrencies within the wallet without intermediaries.

The Atomic wallet supports hundreds of cryptocurrencies and tokens. It features an intuitive interface, and more importantly, it upholds a high level of security by encrypting the user's private keys. Note that the Atomic wallet is a software wallet available for desktop operating systems but also works on iOS and Android operating systems.

Guarda

The Guarda Wallet is a software wallet available in mobile and desktop apps. With some of the most secure crypto wallets, it is right up there, thanks to a heavy focus on security and self-custody, which means users have complete control and responsibility for their private keys. In addition, it supports multiple cryptocurrencies, including ERC20-based tokens. 

Its creators have also gone to great lengths to ensure that the wallet is user-friendly.

Argent

This is one of the youngest cryptocurrency wallets that support the Ethereum network. However, it is also one of the most controversial ones in this list because it is non-custodial, but it does not let users take control of their private keys. Argent achieves this by allowing users to configure their wallets using their email addresses and phone numbers.

One of the most exciting features about Argent is that it is integrated with Compound Finance which is a top DeFi lending platform. This makes it possible for users to lend their ETH directly from their wallets while also earning interest. The Argent wallet also features a dapp browser that makes it easier for users to interact with other dapps. Argent is available as a mobile browser.

Exodus wallet

Exodus is currently one of the most popular cryptocurrency wallets globally. It partly owes its popularity to the first-mover advantage because it was the first desktop wallet to support multiple cryptocurrencies. It facilitates self-custody by holding on to the private keys within the host device, but the security features don't end there. Users can use their seed phrase to recover their crypto if the host device gets damaged or lost, as with most wallets.

The Exodus wallet supports more than 100 cryptocurrencies, including Ethereum, while boasting an attractive and well-organized user interface. It even has a pie chart representation of the cryptocurrencies held in the wallet. Exodus has also teamed up with multiple exchange partners, and the result is that exchanging cryptocurrencies using this wallet is quite reliable and fast. Exodus is available as a desktop and mobile wallet.

Jaxx wallet

The Jaxx Wallet is another self-custody wallet that supports multiple cryptocurrencies like Ethereum. However, its list of supported cryptocurrencies is relatively limited compared to other wallets. 

Developed by a Canadian firm called Decentral, Jaxx is available as a desktop and mobile wallet. Supported platforms include Mac OS, Windows, Linux, Android, and iOS. However, it also plans to roll out a hardware wallet option in the future.

The Jaxx wallet features an attractive user interface and a heavy focus on security. The user's private keys are always held within the device in which it is installed. It also boasts of an active community that maintains the wallet and is responsible for any innovative improvements.

Coinbase wallet

Coinbase is one of the leading cryptocurrency exchanges globally, and naturally, they've created a wallet offering for its clients. It is available as a web wallet and a mobile wallet since it offers iOS and Android apps. The wallet is Ethereum compatible and ideal for trading through the platform. It is also the first example of a custodial crypto wallet in this list because it does not allow users to have control of their private keys and instead holds them in the Coinbase servers.

MyEtherWallet

MyEtherWallet is an open-source Ethereum wallet that exists as a web wallet and as an extension for the Chrome browser. One of the most exciting aspects of this particular wallet is that it gives users control over their private keys within the device on which the wallet is hosted. It also features an inbuilt swapping feature that facilitates swapping between ETH and BTC.

MyEther wallet can also be connected to hardware wallets such as Ledger Nano S and the Trezor wallet. 

KeepKey wallet

This is a hardware crypto wallet developed by a digital asset management company called ShapeShift based in Switzerland. It has a deep focus on security like many of its counterparts. For example, it allows users to generate their private keys, which they can then keep in cold storage for extra protection. In addition, additional security measures are implemented to protect the user's digital assets from viruses and other online vulnerabilities for transaction purposes.

The KeepKey wallet can create a 12-word recovery phrase that is used to retrieve private keys. This means the user's funds will remain safe even if unexpected events occur, such as software failure or loss of the device hosting the wallet. The KeepKey wallet also has a handy display that allows users to confirm all transactions on the hardware wallet and facilitate manual approval of each transaction, thus adding an extra layer of protection and control.

The KeepKey wallet also features ShapeShift integration, which facilitates rapid crypto exchange services. In addition, this wallet supports multiple cryptocurrencies, including Ethereum, and is quite affordable at $49 per unit.

Conclusion

As you can see, there is no shortage of Ethereum wallets to choose from, and the variety caters to different user needs. However, as the saying goes, "not your keys, not your crypto." If you want to own cryptocurrencies, it is a good idea to go for wallets that give you full custody of your digital wealth. Unfortunately, many exchanges which use custodial wallets have been hacked before, and it's best not always to trust these centralized entities. 

Keep in mind that choosing to take control of your cryptocurrencies means you should not be ignorant. Instead, it would help to understand how to navigate this new frontier of blockchain technology, DeFi, and the future of finance.  

Published on:
December 21, 2021