All You Need to Know About Cryptocurrency Wallets

in cryptocurrency •  6 years ago 

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A lot of people think of their cryptocurrency wallet as merely a digitized version of a real wallet that is used for storing funds.

However, it doesn’t actually store cryptocurrencies. Rather, it saves a pair of public and private keys that grant access to one’s digital belongings. In a nutshell, a public key is a string of alphanumeric characters that serves as an address that others can use to send you cryptocurrencies. Likewise, your private key is what allows you to send money to others. You basically use these two keys to sign off ownership of your coins. There isn’t a physical exchange, mind you. The transfer of funds is simply recorded on the blockchain ledger with the difference of the balance in the sender’s and recipient’s wallet.

Ever since Bitcoin came into the limelight, a number of cryptocurrencies have sprouted up. Instead of using different wallets for different coins, many wallets support a multi-coin/ multi-currency option. They can therefore store a variety of altcoins, mitigating the need to hold separate wallets for each one. (No single wallet stores all cryptocurrencies).

There has also been a surge in the number of wallet services being offered today. Each comes with its own level of security and convenience of access. The best wallet for you depends on your requirements and your practices.

These are the 8 Different Types of Wallets

1- Hot Storage

At its simplest, hot storage refers to wallets that are connected to the Internet.

2- Web/ Exchange-based/ Cloud Wallets

This is a web-based wallet and is often hosted by exchanges themselves. Since you have instant access to your wallet.

3- Desktop Wallets

Desktop wallets are software programs installed on a computer/laptop and accessed directly from that device.

4- Mobile Wallets

These wallets run as an app on both Android and iOS devices.

5- Multi-signature Wallets

Multi-signature (or multisig) wallet, as the name suggests, requires more than one signature to authorize and complete a transaction.

6- Cold Storage

The term ‘cold storage’ denotes storing cryptocurrencies on wallets not connected to the internet, and these are comprised of hardware and paper wallets.

7- Hardware Wallets

Hardware wallets are dedicated wallet devices, often in the form of a USB stick. Just plug it in to an internet-enabled device to transfer assets.

8- Paper Wallets

A paper wallet is one of the easiest and safest types of wallets, and is basically a QR-coded printout of the access keys.

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Nice info ...Keep up good work and thanks for sharing

My Pleasure

Very informative for new comers in cryptocurrency

I always want to solve the basic confusions of newly crypto investers

Good lucky bhai
Full of information

nice info

Nice contant

Very good information mate. Thanks

Storing your cryptocurrency securely is quite a task. Whatever wallet one is using, one has to be very vigilant every-time. Good info about variety of cryptocurrency wallets.

Right and remember if u want to be safe all the time than don't hold ur assets on exchange transfer them to hardwares or Paper Wallet these 2 wallets are the most secure ones

good work on this bro.