Safe cryptocurrency storage in 2025: a complete guide for the beginner

Cryptocurrencies are gaining popularity and becoming an integral part of the modern financial system. Every year the number of people who prefer bitcoin, Ethereum, and other cryptocurrencies to traditional monetary units is growing. However, as their popularity increases, there are also many problems related to the security of their storage.

The main reason for the emphasis on security was precisely the incidents related to the loss of cryptocurrencies. Forgotten keys, hacks, and fraudulent schemes have already resulted in the loss of billions of dollars. For example, in February 2025, hackers attacked the crypto exchange Bybit,resulting in the theft of more than $1,4 billion. Incidents like this emphasize the need to understand the basics of cryptocurrency storage security. In this article, we will look at how to properly store cryptocurrency to minimize risk and not lose your funds.

Content

• Where you can store cryptocurrency: custodial and non-custodial wallets
• Hot and cold wallets: what is the difference
• Types of crypto wallets: pros and cons
• Exchange wallets: convenient but not safe
• Mobile and desktop wallets: MetaMask, Trust Wallet, Exodus
• Hardware wallets: Ledger Nano, Trezor and others
• Paper wallets: how relevant are they in 2025
• How to choose a crypto wallet for your purposes
• How to protect your crypto wallet: key measures
• Beginners’ mistakes when storing cryptocurrency
• What has changed in storing cryptocurrencies in 2025
• Conclusion: how to keep your cryptocurrencies secure

Where you can store cryptocurrency: custodial and non-custodial wallets

Currently, there are two main options for storing cryptocurrencies: custodial and non-custodial wallets.

Custodial wallets assume that the user entrusts their funds to a third party, usually an exchange or other service. This means that the exchange holds the private keys and is responsible for protecting users’ crypto assets.

The main advantages of custodial wallets include:

• User-friendliness.
• Support for multiple cryptocurrencies.
• The ability to restore access in case of password loss.

However, there are also significant drawbacks:

• The risk of the service being hacked.
• Trust in third parties.
• Risks associated with legal or financial problems with the service.

Non-custodial wallets give the user full control over the private keys. This means that only the owner has access to their cryptocurrencies, and third parties cannot influence the storage or transfer of funds.

Advantages of non-custodial wallets:

• Complete control over the funds.
• High degree of security.
• Anonymity.

At the same time, there are some disadvantages to consider:

• Responsibility for the protection of private keys lies with the owner.
• Difficulties with restoring access in case of key loss.

Hot and cold wallets: what is the difference

It is important to distinguish between hot and cold wallets, as their use has its own characteristics.

Hot wallets are wallets that are connected to the Internet. They include mobile, web, and desktop wallets.

They are convenient for everyday use: quick transfers, purchases, transaction analytics.

Cold wallets are devices or media that are not connected to the Internet.

They include hardware wallets (such as Ledger and Trezor) and paper wallets. They are considered the safest way to store cryptocurrencies as the risk of hacks and hacker attacks is reduced.

Types of crypto wallets: pros and cons

There are several types of wallets, each with its own unique features, advantages, and disadvantages. Let’s talk more about each of them:

Exchange wallets: convenient but not safe

Exchange wallets provide a high degree of convenience, especially for those who actively trade cryptocurrencies. These wallets provide access to a multitude of features such as buying, selling, exchanging, and trading digital assets, all in one place. Exchanges such as Binance, OKX, and Bybit make it easy to manage your assets, but there are some risks involved.

• Security risks and threats: There are security risks associated with using exchange wallets. The most significant ones are related to the possibility of exchange hacking or freezing of assets. History knows many cases when major exchanges were subjected to cyberattacks and lost significant amounts of users’ digital assets. For example, in May 2019, the Binance exchange was hacked and hackers stole around $40 million in bitcoins. Such incidents emphasize the importance of choosing a reliable and secure platform for storing cryptocurrencies.

• Examples of exchange wallets: Some of the largest and most popular exchanges that provide wallets include Binance and Bybit. Binance offers a wide range of trading pairs, futures and options, and support for multiple cryptocurrencies. Bybit specializes in derivatives and provides a platform for margin trading. Both exchanges are known for their convenience and functionality, but users should be prepared for possible security risks.

Mobile and desktop wallets: MetaMask, Trust Wallet, Exodus

Mobile and desktop wallets are recognized as a great choice for those who want to store cryptocurrencies on their own devices but still have access to their assets from anywhere. These wallets usually offer high levels of security, ease of use, and integration with various decentralized applications (dApps). Such wallets often offer user-friendly interfaces and functionalities such as crypto exchange, staking, and the use of dApps.

• Disadvantages: However, users should be alert to threats related to the physical security of devices. Loss or theft of a device can lead to loss of access to cryptocurrencies if users do not back up their keys.

• Examples of mobile and desktop wallets: MetaMask is considered one of the most popular wallets for interacting with the Ethereum blockchain and its decentralized applications. Trust Wallet, owned by Binance, supports multiple cryptocurrencies and blockchains, making it a versatile tool. Exodus provides an intuitive interface and a wide range of options for managing cryptocurrencies and supports integration with Trezor for enhanced security.

Hardware wallets: Ledger Nano, Trezor and others

Hardware wallets are specialized devices for the secure storage of cryptocurrency assets. These devices provide a high level of security by storing private keys in an isolated environment, which minimizes the risks of hacking and theft. Private keys never leave the device and are stored in a secure environment. This makes hardware wallets virtually immune to cyberattacks and viruses. Even if a computer or other connected device is compromised, the private keys will remain safe on the hardware wallet.

• Possible drawbacks: They may be less convenient for daily use and transactions, as they require physical interaction with the device to confirm transactions. Hardware can also be more expensive compared to other cryptocurrency storage solutions.

• Examples of hardware wallets include Ledger Nano and Trezor, two of the most well-known brands offering hardware wallets. Ledger Nano S and Ledger Nano X implement support for multiple cryptocurrencies and have a smart design. Trezor Model T and Trezor One also offer high levels of security and ease of use. SafePal S1 is another hardware wallet that can be used to safely store over 10 000 different digital assets.

Paper wallets: how relevant are they in 2025

Paper wallets represent one of the simplest ways to store cryptocurrencies. They consist of a printed private and public key that can be used to access assets. Although paper wallets have several advantages, their use is rare today.

• Features of paper wallets: Paper wallets are simple and do not require specialized hardware or software. They can be created by generating and printing keys using special services. The absence of a digital interface is considered an important advantage, which makes them immune to cyberattacks and viruses.

• Possible risks: Their use carries the risk of physical loss or damage. Losing a paper wallet means losing access to stored cryptocurrencies. In addition, the creation and use of paper wallets require careful attention to protect them from moisture, fire, and other factors.

How to choose a crypto wallet for your purposes

Choosing a wallet depends on many factors, such as the purpose of use, level of security, and convenience. Here are some recommendations for choosing a wallet for different purposes.

Active trading and frequent transactions

If you actively trade cryptocurrencies and make frequent transactions, exchange wallets can be convenient due to their integration with trading platforms and functionality. However, you need to consider the security risks associated with exchanges.

Long-term storage and security

For long-term storage and maximum security of cryptocurrencies, hardware wallets such as Ledger Nano or Trezor are recommended. These devices provide a high level of protection against cyberattacks and allow you to store assets securely.

Using decentralized applications and DeFi

If you plan to interact with decentralized applications and financial services platforms (DeFi), mobile and desktop wallets such as MetaMask and Trust Wallet provide convenient access and integration with dApps.

Simple and offline storage

Paper wallets can be considered an option for simple and offline storage of cryptocurrencies, but their use requires careful attention to physical security and storage.

What to choose depending on the purpose

How to protect your crypto wallet: key measures

The security of cryptocurrencies depends on many factors. Let’s look at the key measures you should take to protect your wallet:

• Use complex passwords and two-factor authentication (2FA). Complex passwords should be at least 12 characters long, including letters, numbers, and special characters. This will make it much more difficult to crack. Two-factor authentication adds another layer of protection by requiring confirmation of access through an additional device.

• Regular software updates. Wallet and software updates are important to protect against vulnerabilities. Remember to check and install updates regularly to keep your funds safe.

• Regular backups. Backups of crypto wallets and seed phrases will help you restore access to cryptocurrencies in case your device is lost. Such copies should be stored in secure locations, preferably offline.

• Using cold storage. To protect large sums of money, it is better to use cold wallets. They minimize the risks associated with online storage.

Beginners’ mistakes when storing cryptocurrency

Beginners often make similar mistakes that can lead to the loss of cryptocurrencies. Let’s take a look at the most frequent ones.

• Saving a seed phrase in your phone’s notes. One of the first and most common mistakes is saving the seed phrase in your phone’s notes. In case you lose access to your wallet, the seed phrase will allow you to restore it and gain access to your funds. However, storing such important information in your phone’s notes is an extremely imprudent move. The phone could be stolen, lost, or hacked. If this happens, attackers can easily access the seed phrase and thus your cryptocurrencies.

• Keeping everything on one exchange. Holding all your cryptocurrencies on one exchange is a high risk. The exchange could be hacked or go bankrupt. Split your funds between different platforms.

• Connecting your wallet to fake sites. Phishing sites are a common means of stealing cryptocurrencies. Make sure you are logging into the official website of the wallet or exchange. Check the URL and whether it has an SSL certificate.

• Inattention to address spoofing when sending. One of the most dangerous attacks is the MITM (man-in-the-middle) attack, where attackers can spoof the wallet address when copying and pasting. An inexperienced user may accidentally transfer funds directly to the hacker’s wallet without even realizing the spoofing has occurred.

Understanding and correcting the above mistakes is an important step towards safe cryptocurrency storage. Proper use of seed phrases, diversification of assets, paying attention to fake sites, and careful verification of addresses when transferring and creating backups — all this will help you secure your crypto assets and avoid unpleasant situations. Be careful and protect your assets to maximize the potential that cryptocurrencies offer.

What has changed in storing cryptocurrencies in 2025

The year 2025 has seen significant changes in the cryptocurrency storage industry. Many countries have strengthened KYC (Know Your Customer) requirements. To comply with the laws, exchanges require proof of identity. This makes exchanges less anonymous but more secure. In terms of storage methods, multi-signature wallets (multi-sig wallets) have become more popular due to the added security. Such wallets require the signatures of several users to confirm a transaction.

Source: bitinfocharts.com

The geopolitical situation leads to the possible blocking of accounts in certain countries. This adds risks for users. It is recommended to keep some funds in decentralized wallets to protect against such measures. Using decentralized wallets and platforms allows you to maintain anonymity and independence from centralized services. This is especially important in conditions of negative geopolitical influence.

Conclusion: how to keep your cryptocurrencies secure

Cryptocurrency storage in 2025 requires a comprehensive approach and knowledge of key security principles. Custodial and non-custodial wallets, hot and cold storage — each of them has its advantages and disadvantages. It’s critical to choose the most appropriate means of storage and consider common beginner mistakes, and security trends for your funds.

Maintaining maximum protection and wisely chosen cryptocurrency storage methods will ensure that your funds and nerves are safe in the long run. Utilize the knowledge presented in this guide and don’t forget to update your skills regularly according to new cryptocurrency security trends.