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10-04-2025
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Get advice from AML Crypto experts
Selecting the right wallet to store your bitcoins is one of the most important steps when working with cryptocurrency. Where and how you store your funds affects not only convenience but also your overall security. Today, there are many options available — from simple mobile apps to advanced hardware devices with high levels of protection.

At AML Crypto, we regularly deal with incidents involving loss of access or compromised wallets. In many cases, the root cause is a poorly chosen wallet. That’s why it’s crucial to understand: there’s no one-size-fits-all solution. The best choice depends on your goals, technical experience, and the amount of funds you're handling.

In this article, we’ll explore which wallets support Bitcoin, how to choose the best option for storing it in 2025, and what factors to consider when making your decision. You’ll learn about the different types of wallets, how popular Bitcoin wallets compare, and which wallet allows you to withdraw Bitcoin with minimal risk.

Our approach goes beyond simply listing names — we offer a practical breakdown: how software and hardware wallets differ, where it's best to start, and which Bitcoin wallet to create if you’re just entering the market.

What Is a Bitcoin Wallet and Why Do You Need One?

A Bitcoin wallet is more than just an app or a device — it’s your gateway to accessing cryptocurrency, similar to a bank account in the world of blockchain. It doesn’t actually store bitcoins themselves — those remain on the blockchain — but it gives you access to them through private keys. If those keys are lost or compromised, access to your funds is gone, and there’s no way to recover them.

From a technical standpoint, any Bitcoin wallet is a system that generates a pair of cryptographic keys: a public key and a private key. The public key is used to receive funds, while the private key is required to send them. If the private key is leaked, you lose control of your wallet — and your funds.

There are two main types of Bitcoin wallets:
  • Hot wallets
    These are connected to the internet. They’re convenient for daily use and come in the form of mobile apps, desktop programs, or browser extensions. However, because they’re online, they’re more vulnerable to hacking.
  • Cold wallets
    These store your keys offline, with no constant internet connection. Examples include hardware wallets (like secure USB devices) or even paper wallets (printed versions of your keys). They offer higher security but are less convenient, especially for beginners.
  • In simple terms: hot wallets are easy to use but less secure; cold wallets are more secure but less convenient.

How to Choose the Best Bitcoin Wallet

In the cryptocurrency space, wallets have evolved far beyond simple storage tools — many now offer built-in features like exchanges, staking, and integration with decentralized applications (dApps). However, when it comes specifically to Bitcoin, the key selection criteria remain fundamental: security, control over private keys, ease of use, and trustworthiness.

Here’s what to consider when choosing a Bitcoin wallet:
1
Type of Storage: Hot or Cold
    • If you actively use Bitcoin — for trading, frequent transfers, or daily transactions — then popular hot wallets with internet access will suit your needs.
    • For long-term storage, it’s smarter to choose cold wallets like Ledger or Trezor — they offer maximum isolation from online threats and provide enhanced security.
2
Who Controls Your Bitcoin
Bitcoin wallets fall into two main categories:
  • Custodial wallets
    Your private keys (the secret codes that give access to your Bitcoin) are held by a third party, such as a crypto exchange. This is convenient, as you don’t need to manage the keys yourself. But it comes with risk: if the company is hacked or goes offline, you could lose access to your funds.
  • Non-custodial wallets
    Only you hold the private keys. No third party can access your Bitcoin. This is much safer, but it requires more responsibility: if you lose your keys, you lose your funds — permanently.
  • If you want full independence from any service providers, a non-custodial wallet is the better choice. Especially for large amounts, this gives you total control over your assets.
3
Transparency and Open Source
Some wallets are built with open-source code, meaning anyone can inspect how the wallet works.
This is valuable for two key reasons:

  1. Security experts and developers can review the code for hidden vulnerabilities or malicious features.
  2. Open-source wallets are often created by communities or independent developers — not closed corporations — which usually leads to more transparent and trustworthy software.

Examples of respected open-source wallets include Electrum and Wasabi. Their strong reputations are built on transparency and a focus on security.
  • Summary:
    • Choose a wallet where you control the private keys.
    • Ideally, select one with open-source code — it increases trust and safety.
4
Active Development and Updates
Frequent updates are a good sign that the wallet is being maintained and improved — especially when it comes to addressing new security threats. If a wallet hasn’t been updated in a long time, it may be outdated or abandoned — and that’s a red flag.
5
Interface and Usability
User experience matters — especially if you're new to crypto. Even choosing which wallet to withdraw Bitcoin to depends on how intuitive and clear the interface is. A complicated UI increases the risk of sending funds to the wrong address or making other costly mistakes.
6
Reputation and Community Feedback
Before making a decision, check wallet rankings, user reviews, and feedback in crypto communities. Look into past incidents — wallets with a history of security breaches or shady updates are best avoided. A strong track record and transparent development history are important indicators of reliability.

Overview of Popular Bitcoin Wallets for Storing Cryptocurrency

There are countless options available for storing BTC, but only a handful can truly be considered time-tested and reliable. Below is an overview of wallets that consistently rank among the best Bitcoin wallets, trusted by both everyday users and security professionals alike.*

*This content is provided for informational purposes only and does not constitute financial advice. Choosing a wallet is solely the responsibility of the user. We've selected what we believe are the most reliable options based on publicly available criteria, but the final decision is always yours.
These wallets are consistently ranked among the top Bitcoin wallets based on user reviews and expert evaluations. They vary in terms of security, usability, and intended use — from active crypto management to secure cold storage.

Which Wallets Support Bitcoin and How to Set Them Up

Today, the vast majority of wallets support Bitcoin. However, it's important to note that not all wallets handle it equally. Some are specifically built with Bitcoin as the core focus, while others support BTC as just one of many assets. In most cases, the first type is more secure and reliable.


Types of Wallets That Support Bitcoin
  • Bitcoin-Only Wallets — such as Electrum, Wasabi, and BlueWallet.
    These wallets are designed exclusively for working with the Bitcoin network. As a result, they offer precise support for key features like SegWit, Taproot, and multi-signature wallets.
  • Multi-Currency Wallets — such as Exodus, Trust Wallet, and Atomic Wallet.
    These support dozens of cryptocurrencies, including Bitcoin. They are convenient for users managing multiple assets but often lack full support for Bitcoin-specific functionality.
If your goal is maximum security and full control, it's better to choose a solution where Bitcoin is not just a secondary feature — but the main focus.


How to Set Up a Bitcoin Wallet: Step-by-Step

The setup process depends on the type of wallet you choose, but the overall logic is generally the same:
1
Download the wallet from the official website.
The setup process depends on the type of wallet you choose, but the overall logic is generally the same:

Let’s walk through an example using the Wasabi Wallet, a privacy-focused Bitcoin wallet.(https://wasabiwallet.io/#download)

Make sure you’re not on a phishing site. Double-check the website address and, if you're downloading an installation file, verify its digital signature to ensure it's authentic and hasn’t been tampered with.
2
Create new wallet
You will be prompted to generate a seed phrase — a set of 12 to 24 words that grants full access to your wallet. Write it down offline, preferably on paper, and store it in a safe and secure place. Never save it digitally or share it with anyone.
3
Add password to wallet
It will protect local access to the app or device. While it doesn’t replace the seed phrase, it adds an extra layer of defense in case your device is physically stolen.
4
Double-Check the Address When Receiving Funds
Make sure the Bitcoin address has been copied correctly. Some types of malware can alter the clipboard content. To be safe, use a QR code when possible or manually verify the first and last characters of the address.
5
Send a Test Transaction First
Before transferring a large amount, send a small amount of BTC to make sure everything is working properly and the funds are going to the correct address.
6
Set Up a Backup
Some wallets allow you to export an encrypted backup file or configuration data. Store this backup separately from your main device, ideally offline.
  • When deciding which Bitcoin wallet to create, base your choice on your priorities:
    Do you want ease of use or maximum control?
    In any case, understanding the basics of wallet setup and functionality is the foundation of your crypto security.

How to Safely Store Bitcoin in a Wallet

Storing Bitcoin securely isn’t just about choosing the right wallet. Even the best Bitcoin wallets won’t protect your funds if basic security principles are ignored. In fact, simple user mistakes are among the most common causes of crypto losses. Below are key recommendations to follow — no matter your experience level.
  • Never Store Your Seed Phrase Online
    This is rule number one. Never save your seed phrase in Google Docs, smartphone photos, or cloud notes. The seed phrase must be written down and stored offline, in a secure, private location.

    For large amounts, consider using fireproof and waterproof metal backups for extra protection. And most importantly:

    🔒 Never share your seed phrase with anyone — under any circumstances.
  • Use Cold Storage for Long-Term Holdings
    If you're holding Bitcoin as a long-term investment, store it in a cold wallet (like Ledger or Trezor) that stays offline. This minimizes exposure to hacks, malware, and phishing attacks.

    Cold wallets offer the highest level of protection, especially for significant amounts. While setup may be less convenient than a mobile app, the trade-off in security is worth it.

    For long-term investments, it's best to use hardware wallets (such as Ledger or Trezor) or even generate Bitcoin addresses offline. If you don’t plan to use your funds frequently, this option is much safer than any mobile app.

    This is the best answer to the question: “Which wallet should I use to store Bitcoin?” — especially when large amounts are involved.
  • Verify the Authenticity of the Software
    Only download wallets from official websites. Always check the digital signatures of installation files — especially if you're using Linux.

    Fake wallet software is a common method used by attackers to steal funds.
  • Don’t Use One Wallet for Everything
    Separate your funds by purpose:
    • One wallet for daily spending and small amounts
    • Another for long-term storage
    This helps reduce risks if your device is compromised or you make a mistake with one of your wallets.
  • Secure the Device Where the Wallet Is Installed
    Use antivirus software, two-factor authentication (2FA), and strong, unique passwords.
    For desktop wallets, consider using:
    • A separate user account, or
    • Even a dedicated computer that doesn't stay connected to the internet.
  • Keep Your Backup Up to Date
    If you've made changes — added new addresses, accounts, or changed settings — make sure your backup reflects those updates.

    It’s better to recreate your backup and replace the old one than to assume everything is still accurate.
  • Be Aware of Social Engineering
    Phishing emails, fake wallet apps, impersonated support chats — attackers might not try to hack your wallet directly.

    Instead, they’ll manipulate you into giving away access voluntarily.

    Even the most secure Bitcoin wallets can be used insecurely if you ignore basic precautions.
  • Bonus: Never Connect Your Wallet to Untrusted Websites
    If you're using a browser extension wallet, it may ask to connect to websites for convenience.

    By doing so, you grant the site permission to view your wallet — and sometimes even to sign transactions.

    Phishing and scam sites exploit this by tricking users into unknowingly giving full control over their funds.

    ✅ Always double-check the website and never approve full access unless you fully trust the source.

Comparison of Hardware vs. Software Wallets

The main difference between hardware and software wallets lies in how they store your private keys — the critical component that gives access to your Bitcoin. Each approach has its own strengths and limitations. Below is a practical comparison to help you decide which type of wallet best suits your needs.

Let me know if you want a detailed comparison table (e.g., Security, Ease of Use, Cost, Portability) — I can format that for you as well.
  • Key Takeaways:
    • If your top priority is security and you're storing large amounts of Bitcoin, then a hardware wallet is the best choice for you.
    • If you transact frequently and value mobility and speed, opt for a well-established software wallet with a strong reputation.
    • Many users choose a hybrid approach: they keep the majority of their funds on a cold wallet and maintain a smaller “operational balance” in a hot wallet app for everyday use.

Where to Turn if You’ve Fallen Victim to Crypto Fraud

Even if you follow all the best security practices, it’s still possible to fall victim to crypto fraud. Phishing websites, fake wallets, malicious browser extensions, and scam support services are becoming increasingly sophisticated. The most important thing is: don’t panic — act quickly and calmly.

What to Do First:
1
Save as Much Information as Possible
Record the wallet addresses involved (sender and receiver), take screenshots of conversations, and document the site or app where the incident occurred. This data is crucial for any further investigation.
2
Disconnect from the Internet and Check Your Device
Especially if you were using a software wallet. Run a full antivirus scan, or safely export your seed phrase to another device and remove the compromised app.
3
Don’t Try to “Recover” Funds Using Third-Party Services
Scammers often follow up with a second wave — offering to “help recover” your assets in exchange for a fee. These are almost always fraudulent services looking to exploit you again.
4
Perform AML Checks Before Sending Funds
To reduce risk before making a transaction, it’s critical to perform AML checks (Anti-Money Laundering analysis). These help determine whether a wallet address is linked to illicit activities such as fraud, darknet markets, or hacks.

A great tool for this is Btrace by AML Crypto — a platform that checks addresses in real time for money laundering risks. It's especially helpful when dealing with new counterparties or making large withdrawals to exchanges or external wallets.
When to Involve Experts:

If the amount is substantial or you suspect a targeted attack, it’s time to bring in blockchain investigation professionals. This is often the only way to:
  • Trace the movement of funds
  • Reconstruct the full transaction path
  • Identify wallets connected to criminal activity
AML Crypto specializes in these cases. Their team conducts technical audits, determines how the breach occurred, tracks stolen assets, and assists in preparing legal documentation — should you need to work with law enforcement or crypto exchanges.
  • Even if the stolen funds cannot be recovered, verified evidence and analysis often lead to the freezing of suspicious assets on major exchanges, including centralized platforms.
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