Tezos is a unique blockchain network based on smart contracts, which offers an infrastructure that is reportedly more advanced than that of Ethereum and Bitcoin. This means it can evolve and improve over time without ever being in danger of a hard fork since the blockchain is self-amending. Due to these unique capabilities, Tezos prides itself as future proof. This has resulted in an increased interest in the blockchain network and Tezos tokens. This guide will cover the best Tezos wallets in 2021 along with their features and advantages.
Compare The Best Tezos Wallets
This section will present our selection of Tezos wallets with all their corresponding features and advantages.
Understanding Tezos Wallets
Tezos wallets come in three forms: software programs, hardware devices, or paper printouts. Your choice of the best wallet to store your Tezos tokens will depend on how often you need to access your digital tokens and how much you have. That said, you need to understand that your coins are not held in the wallet as you would expect but on the Tezos blockchain. The wallet allows you to interact with these coins that never leave the blockchain.
A Tezos wallet is made up of private and public keys that are crucial in sending and receiving tokens. Once you create a new wallet, you will use your public key to generate a new Tezos address, which you can share with others and receive funds. As mentioned above, the coins don’t leave the blockchain but are transferred from one holder to another.
To send funds from the private wallet to an exchange or P2P network you will need to generate an address from the platform you intend to send the coins. Typically this involves going in the wallet section where you click on “receive” then an address is generated which you can enter in your wallet to send the coins.
While it’s okay to share your address, it’s not advisable to expose your private key. Since anyone who gets access to it can spend your coins as they wish. The private key is what you will use to access your wallet’s funds and sign new transactions before broadcasting them. Another advantage of the private key is that it helps you recover your public key and address if you lose your Tezos wallet.
Advantages & Disadvantages of Using a Tezos Wallet
How To Choose a Tezos Wallet?
When choosing the best Tezos wallet, you will have to consider several factors such as security, convenience, security, and accessibility. Your decision will be highly influenced by what you are looking to achieve. For example, if you need to use the tokens regularly, a more accessible wallet will make sense. But, whichever wallet you choose, security has to be one of the top priorities since losing even a small amount of tokens cannot feel good.
Also, depending on the wallet’s working mechanism, it can either be termed a hot or cold wallet. Hot wallets are always connected to the internet and entail most software wallets, whereas cold wallets aren’t connected to the internet, like paper and hardware wallets.
You will realise depending on the model of the wallet; its security will vary. The most secure are hardware wallets, which allow for cold storage. On top of having a hold on your private keys, they operate offline, which drastically reduces the chances of being infected with viruses and malware. These types of wallets are best for holding large amounts of Tezos tokens or coins that you have no intention of using anytime soon. The downside is that they are not the most convenient, and accessing tokens whenever you feel like it might be a problem.
Tezos paper wallets are pieces of paper where a blockchain address and private key are physically printed as QR codes. To send funds using this type of wallet, you have to scan the QR code. But, they are not the most reliable of wallets since they are flawed. One big issue is you can’t send small quantities of Tezos. Additionally, if the paper gets ruined or lost, you can forget your coins.
Tezos hardware wallets look like USB flash drive devices. They are easily portable and highly secure since they aren’t connected to the internet. They use a random number generator (RNG) to create public and private keys stored inside the device.
Finally, software wallets are divided into three groups; desktop, mobile, and web. Desktop wallets will require the user to download the wallet program to their PC and then install it. They are relatively safer than other types of software wallets since, as a user, you get to hold your private keys and interact with them without an internet connection. As for mobile wallets, they are applications that you can install on your smartphone and access your Tezos tokens on the go. Web wallets allow one to interact with the Tezos blockchain using a browser interface without installing or downloading programs to your pc.
But if accessibility and convenience are what you are looking for, then software wallets will make more sense. A Tezos web wallet will allow you to access your tokens whenever you want by login into the platform that holds the wallet. Web wallets are convenient for people doing online transactions using Tezos coins and regular traders. The only downside of web wallets is that the user doesn’t have full control of the tokens. Therefore, if the platform holding them is breached, then you will lose your coins.
A desktop wallet will offer more security than a web wallet since you will hold your private keys. It's also convenient for traders, but since you have to login into the internet once in a while, there is a risk of getting attacked using malware.
Mobile wallets are as good as desktop wallets. They are even better since you can access and use your tokens on the go, but they are prone to virus and malware attacks, which can lead to loss of tokens.
3 Steps To Using a Tezos Wallet
Step 1: Choose a Tezos Wallet
Users must evaluate different kinds of wallets based on various features such as security, ease of use and portability. Some cater for mobile and PCs, while others Tezos wallets cater for the web and desktop. Then there are a few hardware wallets. Select the Tezos wallet most suited to your needs.
Step 2: Signing up/Setting up Tezos Wallet
Once you have selected a wallet, go to the wallet’s official website, where you have to download the software. Click on the download option and select “create a new wallet.” Then click on “create wallet file” where you will pick a file name and wallet location. Set a strong password and proceed to “create wallet”.
Step 3: Start using Tezos Wallet
Once your wallet has been created, you can use the newly generated address to receive and send Tezos tokens by following the listed steps within the wallet. Remember, since Tezos uses a proof of stake (PoS) mechanism, it’s possible to stake your tokens and earn rewards right from your wallet.
The Tezos wallet you choose to secure your Tezos tokens will depend on the objective you intend to achieve. If the goal is to store them for the long term, then a secure hardware wallet will make sense. But if you need the tokens often to make everyday transactions or even trade, then an easily accessible and convenient wallet will be your best option. But, whatever decision you make, ensure you backup your wallets regularly, and in case you lose access to the wallet, restoring it will be easy.
Frequently Asked Questions
Since Tezos is a PoS token, it’s possible to stake it on different wallets to earn rewards.
Depending on the wallet you chose, your tokens should be safe. Even for web wallets where you don’t have complete control of your tokens, some platforms will offer robust security to protect user funds.
Unless you have them staked somewhere, then no. Only keep a small number of tokens you regularly use on hot wallets.
No. Since most hardware wallets don’t offer ease of accessibility of tokens.
Private keys shouldn’t be shared with anyone unless you are ready to lose your funds.
Yes, it’s possible by entering your recovery phrase on a new device.
Set a strong password and activate the two-factor authentication 2FA.
If you are a frequent trader, then a software wallet will work best, for long term safekeeping, hardware wallets are the safest option.