Of course, every owner of Bitcoins has to think about where to store them and how to keep track of them. This is where Bitcoin wallets come into play. This is the digital wallet that contains all Bitcoins. In addition, such a wallet allows you to send and receive Bitcoins.
You should handle the wallet like your real wallet. After all, it is a virtual currency that has a value. If you lose your virtual Bitcoins wallet, you naturally lose the contents – in this case the Bitcoins – just like in real life. But where can you get such a digital wallet and what should you consider? Basically, there are two options: Either you decide to get your own wallet or you choose an online or web wallet.
Bitcoin Wallet: What is it?
Wallet with Bitcoins In a Bitcoin Wallet, private keys of the addresses where the respective Bitcoins are stored are managed.
The functions that the wallet can offer are at least fundamentally the same for the different providers.
Thus, thanks to the wallet, you can send Bitcoins and have addresses displayed as a string or QR code, so that receiving Bitcoins is also possible. All addresses are also stored in an address book. Of course, each wallet is locked or encrypted with an individual password.
This is the more complicated alternative solution. Why? Quite simply, you have to search for a wallet and then install it. The good thing here is that you have full control over your Bitcoins at all times. There is also the aspect that you might lose all Bitcoins if you lose the wallet. For this reason, it is also advisable to make backup copies. However, you also have to do this on your own. The standard client for computers is Bitcoin-Qt. There are also Electrum Wallet and Smartphone Wallet.
The advantage of having your own wallet is that you are independent of third parties. You have full control over your Bitcoins and are absolutely independent.
Bitcoin Web or Online Wallet
The definitely less complicated solution is the online wallet (also called web wallet). Here, no installation has to be carried out and the setup works with just a few clicks. Furthermore, the provider here automatically takes care of making backup copies. Such a web wallet is also often better protected. However, if you store your Bitcoins in such an online wallet, you have to be aware that you are dependent on the respective provider and indirectly entrust your Bitcoins to them. In case of technical problems or dubious providers, your own Bitcoins are in danger.
Bitcoin Wallet Summary
Every Bitcoin owner inevitably needs a place to store and manage them digitally. And this is exactly why Bitcoin wallets (= virtual wallets) exist. Whether you ultimately decide to use your own wallet or an online wallet is up to you. A combination of both solution alternatives is also possible: Manage a part of your Bitcoins in your own wallet and the other part in the online wallet.