A Bitcoin wallet is a software program which stores the private key to a user’s Bitcoin address. Contrary to popular belief, a Bitcoin wallet does not store the Bitcoins, it stores a secret number for the Bitcoin address of the user. A Bitcoin address gives control of Bitcoins to the user and facilitates the sending and receiving of the Bitcoins. A Bitcoin wallet can be desktop form, as a mobile application, on the web or as hardware.
A good Bitcoin wallet must have the following 4 vital features:
1. Be secure
Bitcoins are digital currencies and are thus prone to hacking and other online attacks. This makes security one of the most vital features of any Bitcoin wallet. Security is enforced using different methods which vary between different wallets. One is through password protection, with most wallets requiring one to use a strong password that has a lower case, an upper case, a number and a special character. This makes it difficult for anyone to guess the password. Some wallets have a two-factor authentication in which the user is required to use something else as authentication over their password. A good Bitcoin wallet should also have an automatic-timed logout. This ensures that after some time of inactivity, the wallet ends your session to ensure that no one else can use your wallet.
2. Be private
Privacy is just as important as security where Bitcoins are involved. A good Bitcoin wallet should not force you to volunteer too much information as this could jeopardize your privacy. While the blockchain technology which underpins Bitcoin is fairly private, connections can still be made with different facets of information and the more you volunteer, the easier it is to track you down. Your email, your place of residence and identification information should not be shared on your Bitcoin wallet.
3. Accept multiple currencies
While Bitcoin is the dominant cryptocurrency, there are other currencies that are viable investment options. A wallet should accommodate as many currencies as possible. The more currencies a wallet processes the more options a user has in the cryptocurrency market. A good Bitcoin wallet should allow a user to change their Bitcoins for any other supported cryptocurrency.
4. Be user-friendly
Gone are the days when cryptocurrency transactions were complicated and too complex for the layman. A good wallet should have a simple interface that’s easy to understand and use. This allows the users to access their coins, send, receive and check their history with ease and simplicity.
With the number of Bitcoin wallets in the market being quite high, the wallets that contain the above crucial features have set themselves apart and continue to accrue new users every day. A few such as Electrum, Blockchain.info, Exodus, Coinbase and Mycelium have established themselves as market leaders but the decision on which Bitcoin wallet to use depends on individual needs. Those who value privacy the most may prefer Exodus while those seeking ease of use may prefer Blockchain.info. However, the above vital features should all be considered before choosing your Bitcoin wallet.