0
Platforms compared
0+
Countries covered
0
Categories
Daily
Data updates
€60-200
Hardware wallet cost
5,000+
Supported tokens
12-24
Recovery phrase words
0%
Ongoing storage fee
What are crypto wallets?
A crypto wallet is a tool that stores the private keys needed to access and manage your cryptocurrency on the blockchain. Despite the name, a wallet does not actually "store" your coins. Your crypto exists on the blockchain itself. The wallet stores the cryptographic keys that prove ownership and allow you to send transactions.
Wallets fall into two fundamental categories based on who controls the private keys:
Custodial wallets are managed by a third party (an exchange or broker). When you buy Bitcoin on Bitvavo or Coinbase, the platform holds your private keys. You access your crypto through their app. This is convenient but means you trust the company with your assets. The phrase "not your keys, not your coins" summarizes the risk: if the exchange is hacked, goes bankrupt (as FTX did in 2022), or freezes accounts, you may lose access to your funds.
Self-custody (non-custodial) wallets give you direct control of your private keys. No company can freeze your funds or prevent you from transacting. However, if you lose your recovery phrase (a 12 or 24-word backup), your crypto is permanently unrecoverable. There is no "forgot password" option.
Self-custody wallets come in two forms:
Hot wallets (software wallets) like MetaMask, Trust Wallet, and Exodus run on your phone or computer and are connected to the internet. They are free and convenient for daily use but are more vulnerable to malware and phishing attacks.
Cold wallets (hardware wallets) like Ledger and Trezor are physical devices that store your private keys offline. They are considered the most secure option for storing larger amounts of crypto. Prices range from 60 to 200 EUR. You connect them to your computer only when you need to sign a transaction, keeping your keys isolated from internet-connected threats the rest of the time.
Frequently asked questions
If you hold more than €1,000 in crypto, a hardware wallet is strongly recommended. Exchange hacks and bankruptcies (like FTX) have caused billions in losses. A hardware wallet gives you full control over your funds. For small amounts, keeping crypto on a regulated exchange is acceptable.
Nothing, as long as you have your recovery phrase (12-24 words). You can buy a new device, enter the recovery phrase, and all your crypto will be restored. This is why safely storing your recovery phrase is the most important part of crypto security.
Both are excellent. Ledger supports more cryptocurrencies (5,000+ vs 1,000+) and has a mobile app. Trezor is fully open-source, which some security experts prefer. For most users, either is a great choice. The Ledger Nano S Plus (around €80) and Trezor Model One (around €60) are the best entry-level options.
Not necessarily. Exchanges custody your crypto for you, which is convenient but means you do not control your private keys. A personal wallet gives you full ownership and is recommended for larger holdings or long-term storage. The common advice is: use exchanges for trading, move long-term holdings to a wallet you control.
Hardware wallets (like Ledger or Trezor) are considered the safest option because they store your private keys offline, making them immune to online hacking. They cost EUR 50 to EUR 200 but provide the strongest protection. For smaller amounts, reputable software wallets with strong encryption offer a good balance of security and convenience.
If you lose a hardware wallet, you can recover your funds using the seed phrase (a 12 to 24 word backup phrase) generated when you set up the wallet. This is why securely storing your seed phrase is critical. If you lose both the wallet and the seed phrase, your funds are permanently inaccessible. Never share your seed phrase with anyone.
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