What Are Crypto Wallets and Vaults, and Why Should Content Creators Care?
Creating a new economy for creators
While terms like “cryptocurrency” and “bitcoin” have been in the news a lot lately, there’s not a lot of awareness about what these actually are or why they’re useful for everyday people. (At least, not outside of the crypto community.)
But these technologies have the ability to completely transform how content creators like musicians, streamers, pro gamers, and others make a living through sharing their passions online.
In fact, these stand to be some of the most exciting developments for content creators in years.
Here’s a top-level primer on how cryptocurrency works, and why content creators should care about features like crypto wallets and vaults.
How Cryptocurrency Transactions Work
Getting into detail about how cryptocurrency transactions work can be intimidating. But in its simplest terms, it’s kind of like using PayPal.
When you send cryptocurrency funds from one user to another, that transaction is stored on a public ledger known as the “blockchain.” (Think of it like a shared spreadsheet anyone who owns a specific cryptocurrency can view.) That way, everyone using that cryptocurrency has a public way of seeing how much currency is being sent around.
Don’t worry about all of your transactions being made public, though — this isn’t Venmo’s weirdly public social feed. User details are encrypted with secret keys (in the form of long, random strings of text) only the user has.
It’s like converting your username details into a secret code, and the long string of characters (your key) is the only way to decode it.
That way, transactions stored on the blockchain are virtually anonymous unless the user who made the transaction — and who holds the secret keys — chooses to make it public. Then, because everyone has access to the blockchain, anyone with your shared public code could verify for themselves that you’re telling the truth about your transaction.
Still with us? Good.
Since cryptocurrencies are their own currency, their values are separate from US Dollars, Euros, or other “normal” currencies. This is ideal for international transactions, such as selling merch to fans around the world.
So how do you actually get cryptocurrency? You’ll need to buy some with regular money at an exchange. But then you’ll need a digital wallet to store your cryptocurrency in the form of those long strings of random characters.
What Are Wallets?
A cryptocurrency wallet is basically where you store the data that makes up your cryptocurrency. Several major websites offer this service. And since blockchain is decentralized, you can actually create and host your own wallet on your own computer.
But for this article’s purposes, a wallet is simply where you keep your cryptocurrency.
Whenever you send crypto, it will take the currency out of your wallet. This includes:
- Tipping performers
- Buying tickets
- Subscribing to a website
- Selling merch
- ….And more
On Howdoo, cryptocurrency wallets will be how users send and receive µDoo tokens (Howdoo’s cryptocurrency) for participating. If you’re a creator, this will be how you get paid. And if you’re a user, you’ll receive small amounts of µDoos when you see any ads.
Think of it like Reddit Gold, but if you could actually exchange your Reddit Gold for gift cards or cash.
Wallets are great for day-to-day transactions. But when you’re looking for long-term cryptocurrency storage, you need a vault.
What Are Vaults?
Unlike wallets, which are instantly accessible, vaults are a more secure place to store your cryptocurrency. They’re not connected to the network, so you don’t have to worry about any cryptocurrency being accessed from a vault if your account gets hacked.
Crypto funds stored in vaults are extra-encrypted, making them useless for thieves unless they have your specific codes.
It’s a great place to store your crypto if you’re holding onto it long-term. (And as we’ve seen with the huge rise in crypto value over the last 5 years, holding onto cryptocurrency for long periods in time could be a very smart decision.)
Think of it wallets and vaults like a checking and savings account, respectively.
Everyday transactions are handled from your wallet — like buying a t-shirt.
Refilling the account is done through the wallet, too, just like receiving a direct deposit into your checking account.
But long-term storage is done through your vault. Money is moved from your wallet to your vault, like checking to savings, and it takes an extra time to access.
This helps keep it safer and more secure. It also may provide tax advantages saving assets in long-term vault as the value of the µDoo increases over time, depending on your local laws. (Ask your accountant.)
How Would This Work for Content Creators?
All of this tech sounds good and fun, but where’s the benefit to artists?
Cryptocurrency lets content creators using Howdoo to get paid on their own terms.
With Howdoo, we’re using our cryptocurrency as the fuel for our platform economy. And since it’s using Howdoo’s unique cryptocurrency token, we can offer more flexible payment options that normal currency wouldn’t.
If a creator wants to charge for access to a live-streaming concert, she can. If someone wants to tip their favorite vlogger for a particularly helpful vid, he can. There’s no messing with credit cards, international banking, or other hurdles. Just a simple, straightforward way to collect revenue from your creative efforts.
This means µDoo tokens give content creators total freedom to control their monetization.
Howdoo Gives Content Creators New Options to Monetize Their Efforts
By building our platform on blockchain, we’re able to bake cryptocurrency right into the platform.
We think this is going to revolutionize how content creators are compensated for their efforts.
And due to the public nature of blockchain technology, we think this will make the entire ecosystem more fair and equitable.
Want to learn more? Visit www.howdoo.io to sign up for our early access waiting list.