Monero (XMR) is a cryptocurrency focused on anonymity and privacy in transactions. The censorship-resistant coin was released in 2014 to allow decentralized peer-to-peer transactions privately and anonymously. This garbled nature of Monero network has increased the number of hacking attempts on Monero.
Monero currently has only 3 major wallet options for any holders. The 10th largest coin in market capitalization however still lacks a hardware wallet, the safest cryptocurrency wallet yet. Reports suggest that Ledger Nano S and TREZORare developing one for Monero coins.
Why do we need a Monero Wallet?
- Monero currently has a market capitalization of over $3.7 billion USD and a price of $235 as at March 21, 2018. The coin ranks as the 10th largest coin on Coinmarketcap. These numbers show the high value of XMR coins. This notwithstanding, experts expect it to rise above $500 in the near future hence the need to keep your tokens safe.
- Cryptocurrency wallets act as decentralized banks to your money. Monero requires a wallet to store your coins and allows accessibility to the coins through your private key. However, some wallets are more secure than others therefore you will need to select the best and safest to store your coins.
What to look for when choosing a best Monero wallet
Before choosing a wallet to store your XMR, special attention should be placed on the security measures of the wallet provider. Check if the wallet has multi-factor authentication which enhances security.
Before installing a desktop wallet, make sure you check if the version downloaded is compatible with your PC. Web and paper wallets are universally compatible with most smart devices.
The 3 best Monero wallets
|Monero wallet||Wallet Type||Security||Ease of use||Price||Check Website|
|Monero standard GUI wallet||Cold||High||Easy||$0.12||Check|
|Monero Web wallet||Hot||Low||Easy||Free||Check|
|Monero Paper wallet||Cold||High||Difficult to use||Free||Check|
Monero standard GUI wallet
The Monero GUI desktop wallet is known to be the safest method to store your XMR. The wallet is a free, community-developed graphical user interface (GUI) that works offline. The guideline below gives a step by step process to install the Monero desktop wallet.
How to install the Monero standard GUI wallet
- Go to the official Monero page (Check that the website is secure). Click on ‘Downloads’ tab.
- Select the compatible product version with your PC and Download. The wallet is currently available on Windows, Mac, Linux, Arm, and BSD amongst other operating systems. If you don’t know which model to choose click here for verification.
- Follow instructions and install the downloaded file.
- Once you open the installed file, select ‘Create a new wallet’ option.
- Enter your name in the empty dialogue box. Write down the 25-word seed passphrase and ensure it is well stored. It is the only way to recover your wallet account if compromised or you lose your password.
- Your wallet is ready for use!
- Send your XMR to the private address of the wallet, wait for a maximum of 20 minutes for your XMR to reflect on the wallet.
Monero Paper based wallet
This section gives an insight on the cold wallet storage and how you can store your XMR offline using the paper based Monero wallet. It is a bit difficult to use the paper wallet as you will have to key in the address manually for every transaction. Keeping a Monero paper wallet is also risky due to physical theft and you may lose the wallet. Paper wallets are recommended for users with large amounts of XMR that they do not plan to use anytime soon.
Why use Paper based wallets
- Offline storage ensures no one will be able to hack your wallet without physically obtaining the wallet.
- In case you are not available physically, your funds will still be accessible to your kin.
Creating a XMR Paper wallet
One of the fastest ways to create your paper wallet is using the MoneroAddress utility. The program requires a safe and malware-free computer to run effectively. If your computer is not safe I recommend installing ‘The Amnesic Incognito Live System’ (TAILS) operating system. The system ensures your wallet’s security is not undermined while your PC is running the MoneroAddress utility.
- Open TAILS and connect to the internet.
- Go to the MoneroAddress utility official website and select ‘Monero’.
- Click ‘Generate Wallet’. A random private address and public address will be generated.
Note: The public address is the code used to send and receive XMR. It is the only code visible to the public.
- A 25-word mnemonic seed will also be generated. Write down the words and store them very safely. These words will be used to generate new private keys to your Monero wallet.
- To monitor funds in your wallet you can use the provided ‘view key’. Your private key will be used to decrypt your wallet and transact.
- Ensure your mnemonic seed is safely recorded and you can now safely send funds to the public address.
Monero Web wallet
Monero web wallets are online wallets that store your XMR securely. However, online wallets (hot wallets) are risky and it is advised to only store small amounts in them. One of the most popular Monero web wallets currently is MyMonero. The wallet offers the fastest registering process for any XMR wallet.
How to create MyMonero Wallet
- Before visiting the website always ensure you use a private browser such as Tor or switch your PC to incognito mode.
- Go to the official MyMonero website and click ‘Create an Account’.
- Go to the bottom of the next page and write down the 13-word private login key on a piece of paper.
- Type the private key from the paper on the pointed empty box to confirm then click ‘Log me in’.
- Now you are able to send and receive XMR coin in your wallet using the private login key.
Note: One drawback of this type of wallet is the need to type the 13-word passphrase every time you log in.
Frequently asked questions
What is a Monero address?
Monero address identifies your wallet and allows transfer of funds from one wallet to another. XMR addresses may either be raw or integrated. A raw address is a 95 character word that allows transactions to and from other addresses. On the other hand, integrated address are highly encrypted payment ID keys with a 64-word extra encryption on the raw address.
How do I fund my Monero wallet
First, you will need to obtain XMR on cryptocurrency exchanges or mine XMR coin to reap block rewards. To send this coins to your wallet, copy your public address and send the coins to this address.
Why are there no Monero hardware wallets?
The complexity of the built-in privacy system of XMR is one of its most useful features but also poses a problem for the coin. This feature makes it very difficult to build a Monero compatible hardware wallet. Ledger Nano S is working on releasing a test net hardware wallet this coming April. Trezor 2 may also be compatible with XMR.
How do I open a Monero account?
Go to the official Monero website. Click the Downloads tab and download your wallet. You will then be given instructions to install and register. Follow promptly.
How do I know which wallet is best for me?
The current available wallets offer more or less the same level of security. The biggest difference lies in the complexity of working around the wallet. The simplest wallet to use for any beginner is the Monero Web wallet. However, it is risky and it is not advised to store large amounts of XMR on web wallets. The best and safest wallet is the Monero desktop GUI wallet.
Any common mistakes to be careful of?
Check for any new updates on the web and desktop wallets to reduce the number of bugs on your wallets.
Users should keep the 25-word pass phrase securely to avoid loss of money in case they forget their password or malfunctioning of their desktop wallet. This will be used to recover your wallet.
How do I secure my Wallet?
- Keep your seed passphrase offline. Do NOT print the seed, write the passphrase down and keep it safe.
- Make sure your computer is NOT connected to any networks when installing your wallet. You can use TAILS to block any connecting nodes.