How to choose a multicurrency wallet?

Altcoins are gaining ground. The market capitalisation of altcoins has long outpaced that of bitcoin, as reflected in the steadily declining dominance index of the original cryptocurrency. There is a vast array of altcoins, and the capitalisation of some already exceeds $1bn. Many are appealing not only for the technology and ideas behind them but also as candidates for portfolio investment. That raises a simple question: where is it best to store different digital assets?

Some users install a dedicated wallet for each cryptocurrency (for example, Electrum-Dash or Ethereum Wallet). This approach is undoubtedly secure, since each wallet lets you control the private key. If the key is kept safe (for example, written on paper and/or stored on an offline USB device), one can be 100% confident in the safety of one’s digital savings. However, there are drawbacks. First, many disparate wallets are inconvenient. Second, each requires its own seed phrase (which serves as the private key). As many coins as you hold, so many unique phrases you must keep. Lose one and you lose all the funds in the corresponding wallet.

Many crypto-enthusiasts prefer to keep altcoins on exchanges. This is convenient, since modern trading platforms support dozens and even hundreds of different altcoins. Yet the drawbacks are substantial, because you must entrust your funds to a third party. Most exchanges are centralised, not insured against hacks, and are regularly hit by DDoS attacks. That puts funds at risk. Users who do not trade large volumes should consider other long-term storage options that grant control over the private key and, therefore, full control of the assets.

As with exchanges, this option is hard to call reliable, since a third party controls the funds. On the other hand, online wallets often support many popular cryptocurrencies and even allow transactions with low fees. The advantages largely end there. Among numerous online wallets, one can single out the service Cryptonator, popular in the Russian-speaking web, or, for example, HolyTransaction.

With the rise of smartphones, many mobile wallets have appeared for both Android and iOS. Many online services also offer mobile versions (including the aforementioned Cryptonator). Some mobile wallets combine strong security (by letting you save a seed phrase) with an intuitive interface—for example, the Coinomi mobile wallet. The latest version prompts you to back up the seed phrase at first launch. Coinomi integrates the ShapeShift exchange and currently supports about 60 altcoins.

In this segment, Jaxx has become popular as a Chrome and Firefox extension. It is easy to use, with a minimalist design and flexible settings. Most importantly, it lets you control your funds via a seed phrase. The team regularly adds support for new altcoins. For each supported currency there is no need to export and save a separate private key—backing up a single 12-word seed phrase is enough. With it you can instantly restore all wallets and their balances.

A good tool for storage is a multicurrency wallet installed on a computer. Among them, Exodus stands out for its intuitive, polished interface, control over private keys, the built-in ShapeShift exchange and support for many altcoins. Jaxx also has a desktop version for Windows, OS X and Linux.

This type can be considered the most secure, since such devices provide the safest cold storage of digital assets in a protected, isolated environment. It is arguably the best option for long-term storage of significant sums. A hardware wallet securely embeds the private key used to sign transactions. Among the most popular are Ledger Nano S, Trezor and KeepKey. Each supports several of the most popular altcoins, including ETH, LTC, DASH, etc.