In this article I’m going to answer a few common questions:
- When to use a mobile wallet?
- Where to use a mobile wallet?
- How much to keep in a mobile wallet?
- Which mobile wallet to use?
Benefits of Mobile Wallets for Bitcoins and Altcoins
Mobile wallets can be used instantly in any day to day activity, so they are the fastest ways to use your Bitcoins/altcoins.
However, these wallets can also be super risky, so I advise you to treat mobile wallets as you would treat the wallet in your pocket. This means that you should only put in the amount necessary to make imminent transactions with.
So, in my opinion, you should put in as little as possible. Also, you should only use a software wallet in these situations:
- While Travelling – It is quite handy to have a wallet ready to go when you are traveling in countries where there are Bitcoin ATMs. Thanks to these Bitcoin ATMs, you can instantly trade Bitcoins for the supported fiat currency of that country (USD, GBP, EUR, etc.).
- Quick Transactions – When you want to give someone a tip, or when you want to pay with a quick transaction like in a McDonald’s or a coffee shop, having a mobile wallet to use is super convenient.
- To Create Multisig Wallets – You can create multisig mobile wallets to enhance the security of your funds while using mobile wallets. Multisig wallets allow you to spend funds only when you have signed a transaction with at least M out of N keys, for example, for a wallet like Copay, you need to have at least 2 out of 3 keys to perform that transaction. For more info check this post.
- To Fund Your Bitcoin Debit Card – You can use your mobile wallet to quickly and easily fund your Bitcoin pre-paid Visa/MasterCard debit card. These cards can later be used to swipe at any Visa/MasterCard merchant.
- To Show Off – I have seen some early adopters of Bitcoin who like to pay tips through Bitcoin just to show off. However, this can also be done by using a mobile Bitcoin wallet app.
- Airdrops and Education – If you believe in helping cryptocurrencies like Bitcoin thrive, then you can use your Bitcoin mobile wallet to do “educational airdrops”. This will allow you to give away some Satoshi. It will also help you teach people on how to transact using Bitcoin.
Which mobile wallets are the best to use for the aforementioned situations?
The Best Mobile Wallets for Storing Bitcoin/Altcoins
Below you can see the most popular mobile wallets:
- Coinomi (Supports multiple cryptocurrencies)
- BitGo(Multisig Mobile Wallet)
- Copay(Multisig Mobile Wallet)
When Should I Use Mobile Wallets?
In my opinion, the above-mentioned situations are the only times when we should be using mobile wallets.
However, it’s totally up to you to decide for yourself which wallet is the best to use in any given situation.
I have mentioned several times that the type of wallet you want to use ultimately depends upon the level of activity you want to do with your Bitcoins and the kind of security you want.
It also depends on how much you want to store in any one particular wallet and how frequently you use your funds. Also, are the coins you possess for daily transactions, or are they for your savings/investment?
As I already said, it’s up to you to decide what’s right for you.
My Personal Opinion on Different Wallets
For storing a significant amount of Bitcoins, I personally prefer hardware wallets like the Ledger Nano S because of the high-security features.
On the other hand, I use desktop wallets to keep Bitcoins that I am not using for daily transactions but want to keep handy for purchasing other cryptocurrencies, because in this way I can quickly connect my desktop wallet to the Bitcoin network and transfer over my Bitcoins.
And finally, for spending’s sake, I keep some Bitcoins (0.2-0.3 BTC) in my mobile wallet (Coinomi or Mycelium). I can use these wallets anytime on-the-go, similar to how I keep paper money in my pocket wallet.
In short, mobile wallets are easy to use and fast. However, you should never sacrifice safety for convenience.