Setting up an Ethereum wallet for your device can be hard, especially if you are a beginner. You don’t know what criteria is important if you choose an Ethereum wallet. For instance, what should I pay attention to when I make a backup of a wallet? How many backups should I make? What wallet do I need?
I will answer all your questions and provide you a step by step instruction on how to set up and secure your Ethereum wallet on any device.
#1 Choose your Ethereum wallet
Before we start, we have to choose an Ethereum wallet. To give you a quick overview, here is a table that Ethereum wallets support what operating system. I have a guide for every wallet provided below.
|Ledger Nano S||Cold wallet||$59||Yes||Yes||Yes||Yes||Yes|
|Trezor One||Cold wallet||$59||Yes||Yes||Yes||Yes||Yes|
|MetaMask||Google Chrome extension||$0||Yes||Yes||Yes||No||No|
|Mist||Ethereum core wallet||$0||Yes||Yes||Yes||No||No|
Now you have a quick overview of what the good Ethereum wallet exists out there. Don’t worry, I will go through every wallet type and when you should use each wallet.
So, let’s have a look at which Ethereum wallet is best for you. Let’s have a look at some criteria for a wallet.
- Daily use vs. savings wallet (investment wallet)
- The frequency of using the wallet
- Support of operating system (Windows, Linux, Mac, iOS, Android …)
If you are a beginner, you probably don’t want to invest a lot of money before you are comfortable with your wallet choice. That’s okay. You can use my table above and test out different wallets. Just pick one, start, and test.
You are also may be wondering what each type is.
A cold wallet is an external device, usually a USB stick, that stores your private keys offline. This way, your funds are secure even if your computer gets hacked
Google chrome extension
MetaMask is a Google Chrome extension. It is especially useful if you interact with a lot of DeFi products from Ethereum. Ethereum DeFi products are lending, borrowing, or trading platforms. MetaMask is especially useful for these products because the wallet can connect automatically to the protocol if you open the product website.
Also, websites are optimized for the MetaMask wallet and there are a lot of tutorials out there where people use MetaMask for DeFi products.
I should mention that the security of the wallet is dependent on the security of Google Chrome.
A light wallet is a wallet where you don’t have to download the blockchain of the crypto network. Usually, you have to download the whole Ethereum blockchain to become a node in the network. Because most people don’t need it, developers created light wallets.
When you use the Ethereum core wallet, you become a node in the Ethereum network. Most people don’t need it, but if you want to become a node in the Ethereum network, I have this tutorial for you.
So, now you know about each type. Now you are maybe wondering, what type should I use or should I use multiple wallets to get more security? Here are some tips.
Finding the best Ethereum wallet for you
If you are just beginning, I would recommend MetaMask for desktop and Exodus or MyEtherWallet for mobile. If you are investing more money, buy cold storage to make your investment more secure. A cold storage stores your private key on a device that can be held offline, like a USB stick.
The private keys give you access to your funds on the blockchain. In other words, it represents access to your Ether on the Ethereum blockchain. So, never lose it! Cold wallets improve security because they are not affected by a computer virus.
I would recommend storing up to $1000 on a desktop or mobile wallet. It’s just a recommendation and you could store every amount you are comfortable with within these wallets, but you should always be aware that your funds are less secure on a desktop or mobile wallet.
The reason why you should not use cold storage below $1000 is that it’s not worth it paying $50-$100 to get more security. You pay like 5-10% of your investment just to get a little bit more security.
If you plan to invest much more than $1k, you could think of doing everything right from the beginning and buy a cold device. However, if you don’t plan to invest that much in the next few years, wait a little bit. The crypto space is growing extraordinary fast and who knows what new options there are in the next years.
Also, think about the availability of your coins. Do you need ETH when you are outside, then you should have some on the mobile wallet.
Do you want an all-in-one package? Then a multi-wallet like Exodus is good for you. A multi-wallet is a wallet where you can store multiple cryptocurrencies in one wallet. Exodus is a light wallet and available for desktop and mobile.
Which Ethereum wallet is the best for you?
If you are just starting or experimenting with Ethereum, choose MetaMask. It’s easy to install and you could use it right away after the installation. MetaMask is great if you plan to put some Ether in DeFi platforms.
If you need a Desktop wallet to store a moderate number of coins on it, feel free to use Exodus. It gives you advanced features like a portfolio overview and how your portfolio performed the last week/month.
If you need a wallet for your iPhone or Android device, use MyEtherWallet or Exodus. You can only store Ether on MyEtherWallet and many other cryptocurrencies on Exodus.
If you need additional security because you have a large amount invested in Ethereum, use the Ledger Nano S. You could also use the Ledger Nano S if you feel like you need the extra security.
Now you should know which wallet is suitable for your case.
Before we start with installing the wallet, links to the wallets are not affiliated links! (Besides the link in the video from Ledger Nano S, but that is not my video. The link for the Ledger Nano S below is not an affiliate link)
#2 Install the Ethereum wallet
Setup Ledger Nano S for Ethereum
The video below explains perfectly how to move Ethereum to the Ledger Nano S (Not my video, but really useful).
Link to Ledger Nano S: ledger.com
Link to MetaMask: chrome.google.com
After the installation, you have the option to choose between the import wallet option and create a new wallet option. We choose to create a new wallet. Afterward, you are asked to set a password for your MetaMask wallet. After this step, you are asked to save your secret (private key). Always backup your wallet 2-3x.
If you lose your private key, you lose access to your Ether.
If you made a backup of your secret, continue. Afterward, you need to insert your phrase in the right order. You are now able to send or receive Ether with the MetaMask wallet.
You can also switch the network, but I recommend staying on the Mainnet all the time. Switching networks is only required if you are a developer or you want to experiment with certain things. If you are a beginner, never switch to another network.
The MetaMask wallet also gives you the option to add ERC-20 tokens (Ethereum tokens). These tokens are based on the Ethereum blockchain and act as cryptocurrency or asset.
However, if you just want to use Ethereum, use the Etherum address from the wallet. In my case, I had this address: 0x1b3fe6B606EAe59A4227521FA259262a85bd0dF1 (Don’t worry, I don’t use the wallet anymore). The formatting of an Ethereum address is different from Bitcoins or other cryptocurrency addresses. Don’t worry, they work perfectly fine.
You also have the option to generate a new account/address for other use cases. For instance, you could use different addresses for different exchanges.
This is how the starting screen will look like. Here, you have the option to learn more about Ethereum or to generate a new wallet. We choose to generate a new wallet.
Afterward, you are asked to type in a pin and you get some tips to secure the wallet. The pin will be used to sign into the wallet. Therefore, don’t forget it!
You also have the option to set up a Touch ID to log into the wallet.
In the wallet, you have the option to buy Ether. You can purchase Ether with VISA or Mastercard. However, the minimum to start with is $50. The fees for buying Ether in the wallet is around 0.1%.
Link to download MyEtherWallet: myetherwallet.com
Exodus is a multi-wallet for desktop and mobile. This means you could store multiple assets (coins, tokens) on this wallet. They support 100+ assets and the number grows every month.
The installation of the Exodus wallet is straight forward. If you installed the app on desktop or mobile, you can start using it right away. If you are on mobile, you can also secure the wallet with a passcode and face ID. I don’t have to tell you how to install normal software, right? It could also store Ethereum and ERC-20 tokens. Furthermore, Exodus has a built-in exchange which lets you swap coins nearly instantly.
The wallet also gives you an overview of how your coins performed in the last month, how many percentages you hold on one coin, and much more. You could use Exodus on your PC and your phone.
Link to Exodus download: exodus.io/download
The importance of Backups
Always remember one thing: If you lose your private keys, you lose access to your Ethers.
There are no refunds or other techniques to recover your coins if you lost your private key. Therefore, it is extremely important to make at least 2 backups of your wallet. One more thing about backups. Don’t make too many backups.
You have to maintain all the backups. For instance, if you made a backup on a USB device and the other backup is on your PC, there is a chance that the USB device gets stolen or breaks. Therefore, the risk of other security vulnerabilities increases when you can’t have an overview of your backup devices.
It is recommended to make 2-3 backups for your wallets. Even if you are lazy, you should have at least one. Remember to make backups of the most essential things like private keys, passcodes, seed phrases, etc.
Let me give you an example. Let’s say you store your private key in a file and encrypt this file. The file alone now is worthless. If you don’t know the passphrase anymore, you can’t decrypt it. If you don’t have the file anymore, you have nothing to decrypt. You know have to make a secure backup of both components.
I hope this guide helped you. Feel free to share it.