If you are new to the world of cryptocurrency, it might seem strange that you need a wallet to store cryptoassets.
Like so much in the cryptocurrency and blockchain world, it's easy to get intimidated by a new term. The good news is that cryptocurrency doesn't have to be as confusing as it looks.
This article will guide you to learn everything there is to know about cryptocurrency wallets: what they are, how they work, and the one that's right for you if you need it.
What is a cryptocurrency wallet?
A cryptocurrency wallet is a software application in which you store your cryptoassets.
It works like a traditional wallet, but instead of paper money, it contains proof of your digital money.
This wallet allows you to send and receive digital currency and monitor your balance. If you want use bitcoin or any other cryptocurrency, you will need to have a digital wallet.
How does a cryptocurrency wallet work?
The principle is simple. To be able to use and manage your funds, you must have portfolios.
Unlike traditional wallets, cryptocurrency wallets store public and private keys and not physical money. So users can monitor their balance, send money, and perform other transactions.
Even though crypto wallets are similar to traditional wallets, they don't actually store your cryptocurrency. As you already know, cryptocurrencies are decentralized . This means that they are not stored in one place, but rather are recorded in the form of transactions and stored on the blockchain. Therefore, crypto wallets are software that store your public and private keys.
How does a transaction work?
When someone sends you bitcoin or any other type of cryptocurrency, they are essentially sending coins to your wallet address.
Here is an example of a Bitcoin wallet address believed to belong to the creator of Bitcoin, Satoshi Nakamoto!
1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa
Your wallet address is like your bank RIB. You need to share it so that we can send you cryptocurrency. Rest assured, no one can take cryptocurrency from you with your wallet address!
Then, in order to be able to retrieve these coins, the private key stored in your wallet must match the public address to which the currency is assigned. If the public and private keys match, your wallet balance will increase and senders will decrease accordingly.
How to buy cryptocurrency?
To buy cryptocurrency, the easiest way is to get it on an exchange platform or on scholarship app.
These are plentiful, as are the scams. It is therefore important to be vigilant and to choose recognized services. Some of the most popular are Coinbase and Etoro, affordable platforms for beginners that are also available as a mobile app.
How to choose a Bitcoin wallet?
Of course, choosing the best cryptocurrency wallet is a matter of preference.
But its selection must involve a set of pragmatic and practical reasons. First of all, it is important to ask yourself:
- Do I need daily and quick access to this wallet?
- How many currencies will I be holding?
- What are the costs?
- Is safety important to me?
If you are a beginner
Consider starting with an online wallet that charges very low transaction fees. SoFi, Robinhood, and Coinbase are the best for this group. If you have a solid investment background, SoFi, Robinhood, and Exodus are good choices.
If you are an experienced user
Hardware wallets offer the best security. People very comfortable with computers should have no problem navigating the additional complexities. Trezor and Ledger are suitable for this group.
If you are a serious enthusiast
Finally, if you are looking for user-friendliness, security, and convenience, then Exodus is definitely a good choice.
It's'one of the most beautiful cryptocurrency wallets , with a modern and sleek interface and enough handy eye candy to help you control all your crypto funds.
It supports a wide range of crypto - currencies , including some of the most popular such as Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, Litecoin, Dash, Zcash, etc.