Dozens of new people enter the world of crypto daily. With various people investing in crypto, either hardware or software wallets are used to hold their coins. Both wallets allow you to safely store and spend your currencies. However, each has its pros and cons.
To choose which is better, it all depends on your needs and preference. Knowing the distinctions between these two types of wallets can help you choose the one that best suits your needs.
Now that the rise of casino cryptocurrency betting is prevalent, most punters of renowned betting platforms like Gamdom see the importance of using the best crypto wallet to store coins safely. To help you choose which wallet is better, here’s a guide on the pros and cons of hardware and software wallets:
What is a hardware wallet?
Hardware wallets, also known as cold wallets, are only available offline and are standalone devices that look like flash drives that store digital currency rather than a web-based exchange service. These wallets also allow users to remove their digital currency from online servers and keep it locally. This entails that private keys are stored locally on a device only you have access to.
It’s not surprising that a hardware wallet is the most secure way to keep your crypto and other digital assets. Some pros that comes with using a hardware wallet are:
- Security – Hardware wallets are powered up with cutting-edge safety features. Unless you give someone access to your hardware wallet, no one will gain access to your private keys.
- Stability – Due to the physical nature of a hardware wallet, rest assured that your data will be as secure as it can be while you’re using it.
Despite the benefits of using a hardware wallet, there are still some cons that come with it. Some of these are:
- Less convenient – In contrast to a digital wallet, a physical wallet requires careful storage and upkeep.
- Risk of being lost – There’s a risk that you could lose, misplace, or damage your hardware wallet due to its physical nature.
- Cost – Compared to software wallets, hardware wallets come with a price. Some prices of quality hardware wallets range from $59 to $300 or more.
What is a software wallet?
Software wallets also known as hot wallets are non-physical or digital wallets that can be installed on a computer or mobile device. If you lose access to your password or your device is compromised, you can only retrieve your money by using the recovery phase which is given upon signing up.
Software wallets have an extensive list of benefits crypto users can take advantage of to store their crypto assets. Some of these are:
- Convenient – Using a digital wallet is convenient because it is user-friendly. With a mobile or web wallet, you can purchase and use decentralised apps from your phone, no matter where you are.
- Flexible – The majority of digital or software wallets can be used to hold a wide variety of assets. You can ditch the idea of using multiple apps to keep track of your crypto assets. The features and functionality of software wallets are consistently upgraded making them flexible to use.
- Cost-friendly – There are a variety of software wallets available and most of them are free. If there are fees, it won’t take a huge amount from your wallet.
Despite the pros a crypto user can reap from using a software wallet, it still comes with various cons. Some of these drawbacks include:
- Security – Many people believe that a hot wallet is less secure than a cold wallet. This is because the keys are kept in the wallet which is constantly online making it more susceptible to cyber-attacks. If someone gets a hold of your password, they can access your account and steal your assets.
- Lack of stability – A software wallet is less stabilised than a hardware one since it relies on a third party to provide access to your funds. With a software wallet, you risk losing access to your account if the app or programme crashes or is taken down for maintenance.
Which is better?
Both the hardware and software wallets come with unique features. However, not all of their aspects are the same. Sometimes, a certain wallet is better than the other. To give you an idea, here’s a comparison of which wallet is better:
When it comes to the level of security
Although crypto recovery services should be provided for both wallet types when it comes to security, hardware wallets are better. Since it is not connected to the internet, it is extremely safe and protected from online threats. On the other hand, a software wallet requires an additional safeguard because it is vulnerable to cyberattacks due to its online nature.
When it comes to price
Software wallets are a lot cheaper than hardware wallets. In fact, most software wallets are free making them much better when it comes to price comparison. With a software wallet, you can use your smartphone to keep your coins within reach.
When it comes to the mode of storage
Hardware and software wallets both have the same goal which is to keep investors’ assets safe. Unlike a software wallet, which maintains its contents in a computer’s memory, a hardware wallet uses a physical device to store its data.
Many users favour software wallets due to their convenience and availability, but some favour hardware wallets due to their increased security. When it comes to the mode of storage, both wallets can effectively store your crypto assets with zero hassle.
If you are a fan of casino cryptocurrency betting and often visit a renowned Bitcoin casino such as Gamdom, having a crypto wallet is important for a hassle-free crypto betting experience. When it comes to choosing which wallet is better, it is best to determine if you want to use it for investing, gaming, or for daily purchases.