Many people use the standard red capped bottled that you can buy from any pet shop for approximately £1 each. These are attached to the cage by a piece of wire that hooks around the bars and the bottle hangs within this as shown in the picture above (note the white around the red cap is actually sand as the chins had just had a sand bath! This would need cleaning off).
These bottles can be very good ,but many chins get into a habit of chewing at hem through the bars - and if the wire is too short, as is often the case with the smaller sized bottles, then the chinchillas can chew a hole in the top of the bottle. This hole will allow air to access the bottle and breaks the vacuum causing the bottle to continually drip.
Once a chin learns this habit it can be very difficult to stop it. One method is to cover the top of the bottle with a fake top - I generally use a cut up bottle that has been ruined in the past, as shown in this picture (right).
As shown in the picture further above, algae can grow in bottles that are not kept clean. The green algae grows in light conditions where high oxygen is present and shows that this bottle has not been cleaned in a long time and should not be hung on a cage!
Your pets need clean and fresh water constantly available and each bottle should be cleaned out daily using a bottle brush and hot water, before being refilled. NEVER just top up the bottles day after day - the water will be stagnant and bacteria can grow under such conditions which could cause your chin to have an upset stomach and diarrhoea. Where there is large algae growth in a bottle, add some rice to a small amount of water in the bottle and shake vigorously - this will grind the algae off the walls of the bottle. Empty the bottle and swill through before refilling.

Another problem with these type of bottles in that the chinchilla often eats the plastic around the nipple - and in some cases the nipple itself!
If the nipple is made of aluminium then the chinchillas can chew holes into it, but when the nipple is made of stainless steel the chins cannot chew the metal itself, though they will chew the plastic until it allows air in and the bottle drips - or till the nipple falls out.
TIP: if your chins chew through a cap, then throw that part but keep the bottle! If it punctures the bottle, then throw that but keep the cap!
A better type of bottle is the sort that uses a cage to hang it onto the cage, and has an opaque body to the body, closed with a black stopper. These are generally a lot more expensive - about £6-7 but less likely to need replacing, contain more liquid, less likely to leak and cannot be eaten by the chins in any way.
You may occasionally also still be able to buy glass bottles, these are good and with careful handling can last a long time - however they can be knocked off the cage and smashed easily.