What is Crypto Wallet — And Everything You Need To Know in 2022
what is a cryptocurrency wallet?
Like your traditional wallet, cryptocurrency or crypto wallet aren’t that different. Better still, we could say the crypto wallet idea was born out of traditional wallets…
There’s not enough difficulty understanding what a cryptocurrency wallet is. Simply put, they are the device for keeping your crypto such as bitcoin, Ethereum, Litecoin, etc. safe.
Okay, let’s get into more of what Crypto wallets are. Crypto wallets are unique devices that save public and private keys of users with a simple user interface (UX) for managing their crypto balance.
And in most cases, these devices also provide support for cryptocurrency to be transferred from one device to another with the help of blockchain technology.
Why Cryptocurrency Wallet Is Important?
This question is asked a lot and we understand why. Someone new to crypto might not want anything to do with wallets. And for one reason, they don’t feel it’s important but we will let you know why it is important for anyone going into cryptocurrency.
Crypto wallets do not physically hold or store your cryptocurrency on them but rather stored on blockchain technology. This makes it possible for you to only access your crypto with a private key and without them, you simply can’t.
This key only available to you validates your ownership of your cryptocurrency and allows you to conduct transactions. Since this key is only available to you, losing it means, you’ve lost access to your money and cannot be retrieved. Do keep your keys safe all the time to prevent loss of money.
How Cryptocurrency Wallet Works
With hot and cold formats, cryptocurrency wallets are based on these (2) forms. Each with a different task to perform, your crypto is always safe and ready to be accessed anywhere on them.
Crypto wallets are available in both software and hardware formats. Though each kind works in a slightly different way, they are all meant to allow you to safely access any bitcoin you hold.
A cryptocurrency wallet does not store any actual cryptocurrency. It stores the public and private key information required for your crypto transactions.
Your crypto is kept on the blockchain technology which is a form of digital record that serves as the foundation for numerous decentralized cryptocurrencies.
How to use Crypto Wallet
Paper wallets: Keys are stored in a safe area after being written on a tangible medium such as paper. This, of course, makes utilizing your crypto more difficult, because it can only be spent on the internet as digital money.
Hardware wallets: Keys are saved in a thumb-drive device that is kept in a secure location and is only linked to a computer when you wish to access your cryptocurrency. The idea is to find a happy medium between safety and reliability.
Keys are saved in an app or other software in online wallets; search for one that uses two-step encryption. This allows transferring, receiving, and utilizing cryptocurrency as simple as using an online bank account, payment system, or brokerage. (via coinbase )
Where to buy crypto wallet
there are many types of wallet provides where you can get both hot or cold wallets. But we will list a few options to get your crypto wallets.
- Coinbase: This company provides free online hot wallets and guarantees losses caused by security breaches like cyberattacks, employee theft, or fraudulent transactions.
- Electrum is a form of software that allows you to keep your bitcoin on your laptop or desktop computer.
- Blockchain is a type of online hot wallet.
- Mycelium is a Bitcoin-specific mobile wallet that is available for android and iPhone users.
- Trezor: This startup sells compact, key-sized cold wallets for $60 to $220.
- Ledger Nano: Designed in the shape of a thumb drive, the Ledger Nano offers cold wallets ranging in price from $60 to $120.
Crypto Wallet for NFT
- Metamask: metamask wallet is used to interact with the Ethereum blockchain
- Math Wallet: this is a universal crypto wallet for all storage
- Trust Wallet: For storing BEP2, ERC20, and ERC721 tokens
- Alpha Wallet: this is an open-source Ethereum wallet.
How Crypto Wallet Make Money?
Here is how owners of cryptocurrency wallets make money
- Through transaction fee
- When the users stake their crypto assets a number of times, the owners of the wallets are rewarded with commissions on them.
- Through consultation fees
- When there is a launch for a new crypto coin or token.
Can Cryptocurrency Wallet be Hacked?
your crypto wallet can be hacked if your private keys are exposed
Are Crypto Wallet Addresses Case Sensitive?
No, crypto wallet addresses are not case sensitive.
Is there a wallet that holds all cryptocurrency?
yes, a big example is coinbase wallet, they can store and support numerous crypto assets
Can Crypto wallet be traced?
Yes and No. some crypto wallet like electrum is best known for its anonymity
Which cryptocurrency wallet is best?
there are alot of crypto wallets out there. DYOR and find the
one the works for you best.