How to Choose a Web3 Wallet: A Comprehensive Guide
A Web3 wallet should fit your unique needs with managing your funds and participating in the Web3 economy. Each type of Web3 wallet differs in its strengths, so finding the right wallet to help you meet your needs – whether it’s helping you earn through DeFi more easily or managing your funds with maximum security – is key.
What is a Web3 wallet?
A Web3 wallet is a cryptocurrency wallet that is designed to store digital currencies like NFTs and cryptocurrencies, work with decentralized applications (dApps) for using protocols in DeFi, GameFi, and other Web3 services. Web3 wallets allow you to interact with networks like Ethereum and Avalanche, participate in decentralized finance (DeFi) applications, make purchases on dApps, and more.
There are many different Web3 wallets available, ranging from simple browser extensions to more advanced mobile and desktop applications.
Self-custodial wallets vs Custodial wallets
Some Web3 wallets are self-custodial, meaning that you hold your own private keys and have complete control over your funds. Others are custodial, meaning that the wallet provider holds your keys and has control over your funds. Private keys are unique, secret codes that are associated with your cryptocurrency addresses and are used to prove ownership of your funds. They are an essential part of the security infrastructure of cryptocurrency wallets, as they are what allow you to access and control your funds.
Right from the get-go, custodial wallets should be the last option for users to manage their funds with. At any time, users could lose access to their custodial wallets as the wallet provider has the ability to take away users’ funds. For instance, FTX, one of the largest cryptocurrency exchanges, recently prevented most of its users from withdrawing their funds. It turned out that the exchange had been mishandling most of those funds and lost billions of dollars of users’ deposits.
Many users still prefer using custodial wallets because they are easy to use. Custodial wallet users also don’t have to worry about safekeeping their private keys as the wallet provider manages them for them. But, sacrificing the safety of your funds for the sake of saving the hassle of managing your own private keys can put you at risk of losing all of your funds. Instead, choosing to protect your keys and using a secure method for storing them will provide better security for your funds.
Although self-custodial wallets are generally less easy to use than custodial wallets, there are still wallet options available that are simple enough for users!
Security of funds
Ease of use
Low - High
Hot wallets vs Cold wallets
Among self-custodial wallets, users also have to choose between hot wallets and cold wallets. Hot wallets, such as browser extensions or mobile apps, are convenient for making transactions and accessing your funds on the go, but are also more vulnerable to security threats like hacks and malware. Cold wallets, on the other hand, are offline storage devices that offer a higher level of security, but are less convenient for everyday use. Hardware wallets, like Trezor or Ledger, are physical devices that offer a balance of security and convenience, as they allow you to store your keys offline while still being able to easily make transactions when needed. Ultimately, the best option for you will depend on your specific needs and how you plan to use your cryptocurrency. Many users decide to balance their use of the two types of wallets by storing most of their funds in cold wallets so that there is ultimate security while keeping a smaller portion in hot wallets for easy, on-the-go use of Web3 apps. With self-custodial hot wallets like Omni, it is also possible to integrate your cold wallet with your hot wallet. This means that while your private key is stored completely offline on a cold wallet, you can connect it to a hot wallet to interact with services like lending protocols and gaming dApps.
Security of funds
Ease of use
Low - Mid
Mid - High
(depending on how well the private keys are managed)
Mid - High
*To get the best of both cold wallets and hot wallets, use self-custodial hot wallets that enable you to integrate cold wallets.
Only once you have identified a wallet that meets your security needs, you can then evaluate its other features and characteristics to determine if it is the right fit for you. Remember, your cryptocurrency assets are valuable and vulnerable to theft or loss, so it is essential to choose a wallet that provides a high level of security to protect your funds.
After security, you need to check if the wallet fits your needs. For instance, if you are looking for a wallet to manage your SOL tokens, then it is easy to eradicate the wallets that do not support it. In such cases, you should also search for wallets that make it easier for you to conduct the kinds of activities that you tend to conduct in Web3. For instance, if you are an NFT collector, then look out for wallets that make it easier for users to manage their NFTs. Or if you want to earn more through DeFi, then look out for a wallet that makes earning activities like staking and lending easier.
Customer support and development activity
A wallet with an accessible customer support team and active development indicate healthy signs of reliability. To learn more about the level of support a wallet provides, look up reviews of the app on social media accounts and online forums. If you already have a shortlist of wallets, try testing their support strength first hand. It is also important to check if the wallet is regularly developed and adds consistent value in terms of updated features and functionality as this indicates that the wallet team will stay updated and relevant.
Choosing a Web3 wallet that is right for you
Our recommendation: Omni wallet
As a multi-chain Web3 wallet that supports over 25 networks, including most major blockchains, Omni is the perfect choice for users who are looking for a feature-packed, user-friendly solution for interacting with Web3. The Omni wallet is suitable for both beginners and advanced users, as it makes advanced Web3 functionality simple and accessible. Omni is known for its speedy and helpful customer support, and its self-custodial wallet ensures that users have sole access to their funds. In addition, Omni supports Ledger hardware wallets, making it easy for users to integrate their hardware wallet and interact with Web3 through the platform. Omni also make DeFi earning a breeze with a simple 3-step process for staking on major networks, lending via Aave, and depositing into Yearn yield vaults. Plus, our wide range of NFT support and slick NFT display UI allows users to decorate their wallet with their favorite NFTs. Omni is a function-packed and easy-to-use solution that is perfect for beginners and advanced users looking for simplicity!