Before we introduce the individual wallets, it is important to understand what distinguishes the different Ethereum wallets.This makes cold wallets much safer than hot wallets. The reason is obvious. While hot wallets can be attacked by hackers via the Internet connection, cold wallets have no point of attack.Because the difference in security between the two is so significant, large crypto investment firms and cryptocurrency exchanges never keep most of their customers’ money in a hot wallet, but always in a cold wallet! In our opinion, you should take this as an example. In the private customer segment, cold wallets comprise hardware wallets and paper wallets.
Not only for Bitcoin there is a seemingly innumerable number of wallets, but also for Ethereum (ETH) new wallets have come onto the market in recent years. Some of the wallets differ significantly in terms of their functions and security. Each type of wallet has specific advantages as well as disadvantages. Keeping track of the multitude and variety can be especially difficult for beginners.
The private key is mathematically linked to the wallet address, which is a hash version of the public key and cannot be reversed thanks to cryptography. In contrast to the private key, the public key or wallet address is not secret.
Hardware Wallets have the highest security standard compared to all other Wallets! As already mentioned at the beginning, the Private Key of an Ethereum hardware wallet does not come into contact with the Internet. This is stored on the hardware wallet. A transaction can only be released via the physical device. This effectively protects hardware wallets against phishing attacks and other malware. A theft of your Ethereum (ETH) from the Hardware wallet is almost impossible.
In addition, hardware wallets are also physically very well protected in the event that the device is stolen. The hardware wallets presented below all have an additional authorization by means of a PIN. In addition, some hardware wallets offer the ability to set up 2-factor authentication, making the devices virtually unhackable even in the event of theft.
As the name suggests, desktop wallets are programs that are installed on the computer to manage Ethereum. The advantage over online wallets is that the private keys are stored on your own device and not on the server of a company. Thus you retain full control over your ETH. However, a desktop is not as well protected against hacker attacks as a hardware wallet, since your PC is (probably) permanently connected to the Internet. Nevertheless, the protection is significantly higher compared to online and web wallets.
It is very important that the Atomic wallet does not store the private keys or the transaction data itself or pass them on to third parties. Both private key and transaction data are stored exclusively on your own device. A very useful feature, from which the wallet gets its name, are the Atomic Swaps. This allows different cryptocurrencies in the wallet – peer-to-peer – to be exchanged without an exchange being involved (which charges additional fees for the trade in addition to the network fees). For coins that do not yet support Atomic Swaps, the wallet offers the option to use Changelly or ShapeShift to execute trades from within the wallet.
Author : Jake Simmons