A crypto wallet allows crypto holders to store their public or private key more safely and approve crypto holders to send, receive and spend cryptocurrencies safely. It can be in the form of a hardware wallet or software wallet.

So, what are public keys and private keys?

Public Key

In crypto, the public key is the cryptographic code matched with a private key to allow crypto holders to receive cryptocurrency transactions.  

Anyone in the crypto world can send cryptocurrency transactions to other crypto holders’ public keys, and receivers need the private key to unlock the transaction and prove their ownership of the received transaction.

The public key that can receive transactions is usually an address, which is just an abbreviated form of the public key. Therefore, crypto holders can freely share their public keys without worrying about security concerns.

Private Key

The private key is used to prove the ownership of crypto holders’ public addresses or spend the funds related to the public address. Therefore, do not share your private key with anyone else; otherwise, you will lose your funds and cannot get the funds returned.

Generally, the private key can take many forms, such as seed phrase (the most common one), QR code, 64-digit hexadecimal code, and 256-character long binary code.

Why is a crypto wallet important?

The most crucial part of the crypto wallet is that it stores the public and private keys, and the keys can prove crypto holders’ ownership of their digital money and allows them to make transactions. This is important because all of the crypto holder’s funds are on the blockchain and can only be accessed by using private keys.

Types of the crypto wallet

Software wallet

Software crypto wallets enable crypto holders to securely store digital currencies and tokens in an online software wallet application. It can be in the form of website extensions, phone applications, etc.

The most popular software-crypto wallet is Ethereum’s wallet Metamask. Moreover, Solona blockchain’s phantom wallet also has a great number of users. Furthermore, Guarda wallet, Exodus wallet, Electrum wallet, Mycelium wallet, and Coinbase wallet are great options.

Hardware wallet

Crypto hardware wallets look like USB sticks. It is considered one of the best methods of storing cryptocurrencies. This is because they allow users to store private keys offline from the Internet or ordinary computers where they could be stolen after hacking. The most representative hardware wallet is Ledger.

How to use a crypto wallet?

If you are trying to use a software crypto wallet, the first step is to set up the website extensions or download phone applications. The second step is to write down the seed phrase that the wallet provides at the beginning of using it. And store the seed phase in a safe place. Because if you lose your seed phrase, you cannot access your wallet. Then, the third step is to use the user guidance provided by the crypto wallet to send or receive your crypto transactions.

The first step is to plug the device into your computer and unlock it with your PIN for a hardware wallet. Then, create a transaction and confirm it on the device’s screen. Thirdly, make sure your keys are in a safe place.

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