Everything Crypto Wallets — blocktrain.info
A Crypto Wallet is a container for digital assets (Cryptocurrencies & NFT). It’s like a tool that helps us manage our assets in one place and allows us to do transactions. It is a gateway to blockchain. Cryptocurrencies never leave the native blockchain, they are just transferred from one wallet to another just like transfer of water from one bucket to another.
A Wallet has two components :
- Public Key
- Private Key
Public Key
The address that you use to send or receive the assets is the public key. For different tokens on a same chain, there is one public key. Whereas for multi chain wallets there are multiple public keys for each chain. That’s why you have same wallet address for DAI and ETH in Metamask, whereas different addresses for Solana and Eth.
Private Key
The private key is a 12, 18 or 24 long phrase that we are asked to save when we create a new wallet. This phrase is needed to verify the ownership of the assets in the wallet, if you loose your phrase you lose the assets in the wallet.
Types of Wallet
- Hot Wallet
- Cold Wallet
Hot Wallet
The wallet that is connected to the internet is called a hot wallet. Like Metamask Phantom or Trust Wallet. It’s also called Software Wallet that can be either web based/extension, desktop wallet or mobile app wallet.
Cold Wallet
It’s a hardware device that stores the assets along with private and the public keys but is never connected to the internet. It’s like a store of value, people who hold for long term prefer using a ledger as it’s safe from hackers.
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