We’ve talked about ways to get your hands on Bitcoin, as well as exchanges where you can buy and sell Bitcoin, so an overview of some of the more notable Bitcoin wallets out there is probably long overdue. Generally, Bitcoin wallets, despite the name, don’t actually store Bitcoins. Instead, wallets consist of two keys, a public key and a private key, that are used to associate particular Bitcoins with your wallet. The public key allows you to receive Bitcoins, while the private key allows you to spend Bitcoins.
As you might imagine, the security of your private key is incredibly important, lest someone gains access to your wallet and spend all the Bitcoins you’ve mined or traded for. Which wallet you choose depends on whether utmost security or increased convenience is more important, and it’s recommended that you don’t stick to one particular type of wallet. Here’s a list of 10 different wallets for secure Bitcoin storage.
Recommended Reading: 20 Places To Spend Your Bitcoins
Bitcoin Core is the original Bitcoin wallet, originally developed by Satoshi Nakamoto and continually updated by the core Bitcoin development team. While it doesn’t have the advanced features of Armory or the social aspect of Hive, Bitcoin Core is probably the most scrutinized and worked-on wallet out there, making it a trustworthy choice.
One thing to be aware of is the fact that Bitcoin Core is a fully fledged node of the Bitcoin network. So it requires the entire blockchain to run. Bitcoin Core is available on Windows, Linux and Mac, and is also available as a Ubuntu PPA.
Multibit is a lightweight software wallet. As with most software wallets, Multibit encrypts your private keys locally (or on a USB stick). One useful characteristic of Multibit is that it doesn’t need to download the entire blockchain to access, send and receive funds. Multibit connects directly to the Bitcoin network and downloads only a small part of the blockchain, making it very fast to use.
Since Multibit doesn’t download the entire blockchain, it also takes up a lot less space on your hard drive, which can be important in some situations. Multibit has also been translated into more than 35 languages and is available on Windows, Mac and Linux.
Electrum is another lightweight Bitcoin wallet in the vein of Multibit. Electrum supports deterministic wallets or, in other words, generating multiple wallets from one seed. It also lets you sign and create transactions offline and export what it calls a "root public key", which lets compatible applications monitor your wallet. You can also import and export private keys from other Bitcoin wallets.
Like Multibit, Electrum lets you perform Bitcoin transactions without having to download the entire blockchain, making transactions a lot faster. Electrum uses a network of servers to achieve this. Electrum is available for Windows, Mac, Linux and Android.
Hive is a Bitcoin wallet targeted at new users, with some interesting features. For one, Hive has an instant messaging style interface that lets you send and receive Bitcoins quickly and easily. It also has an integrated application platform and comes with some built-in apps that give you easy access to some of the more popular Bitcoin-related services available.
Hive even has an SPV backend to speed up starting time, as well as support for the Tor network for increased anonymity. You can also schedule wallet backups onto Dropbox and Time Machine. Hive is only available on Mac OS X, but is also coming to Android in the near future.
Armory is one of the most feature-rich and secure software Bitcoin wallets available today. Armory offers three different user modes: Standard, Advanced and Developer. Some of it’s security features include a graphical keyboard to protect against keyloggers, support for deterministic wallets, offline transactions and extensive cold storage options, including fragmented paper wallets.
Offline transactions significantly increase your wallet’s security and protects it from most security risks. It requires the official Bitcoin Core wallet, since Armory doesn’t have any networking features. Armory is available on Windows, Mac and Linux. It’s also available as a Ubuntu PPA.
Blockchain’s wallet has a few interesting security features designed to overcome some of the security risks inherent in online wallets. For example, Blockchain implements client-side AES encryption, protecting your wallet from a server side hack. It also has support for offline transactions, a double encryption feature and two factor authentification.
Blockchain not only lets you back your wallet up automatically onto Google Drive or Dropbox, but also lets you download your wallet manually. Blockchain also performs regular off-site server side backups every hour. There’s even a mobile wallet version of Blockchain for Android.
Coinbase is an online Bitcoin account, somewhat similar to PayPal. Coinbase also has a built-in Bitcoin exchange where you can buy and sell Bitcoin, and lets you send and receive money directly to and from email addresses. Coinbase is a centralized operation and stores all its Bitcoins on-site, but claims to store 85% of its Bitcoins in offline cold storage.
There are potential security and trust issues with Coinbase, especially since its operators have control over all Bitcoins, but the fact that it’s been heavily backed by prominent venture capital firms makes it less likely that Coinbase will run away with users’ Bitcoins. There is also a Coinbase Android app.
Coinkite is somewhat similar to Coinbase, in that it provides plenty of Bitcoin-related services such as Bitcoin debit cards and payment terminals alongside an online wallet feature. Coinkite uses BIP32 Heirarchical Deterministic (HD) wallets, which are stored in a custom Hardware Security Module (HSM) that is apparently isolated from the Internet. You can even request audit reports from Coinkite.
In the case of closure or failure, Coinkite has promised that it will publicize a symmetric key that contains all the extended private keys that have been distributed to Coinkite users. This will allow users to reclaim their funds from Coinkite, if the service shuts down.
BitAddress is a web service that generates randomized public and private keys that you can use to receive, spend and store your Bitcoin. The big appeal of BitAddress is that it can create paper wallets. Paper wallets are a particularly secure form of cold storage, since the private key is only stored on a piece of paper and not on the Internet or in any form of software.
Bear in mind that you’ll have to import your private key into some form of digital wallet, if you want to perform transactions. Thus, it’s probably best to use a paper wallet as a complementary form of Bitcoin storage alongside a software or online wallet.
Pi-Wallet is currently the only commercially available hardware Bitcoin wallet. The Pi-Wallet is basically a Raspberry Pi running a software Bitcoin wallet, namely Armory. As such, it has all of Armory’s features in addition to a few perks that only a hardware wallet of this type can provide. For instance, the Pi-Wallet doesn’t have direct Internet access, adding another layer of protection.
The Pi-Wallet is also portable, and as it’s built on a Raspberry Pi that makes it much less susceptible to viruses and trojans that can be used to steal Bitcoin from your average Windows computer. The site also has instructions on building your own Pi-Wallet.