What is a crypto wallet? An easy and complete information.

In the world of cryptocurrency, you must have heard a word many times: crypto wallet. If you are new to this world or have already bought some coins, then it is very important to know what a crypto wallet is and how to use it correctly.

This blog will give you all the necessary information related to crypto wallets. How it works, how many types there are, and how you can keep your coins safe.

What is a crypto wallet?

A crypto wallet is a digital tool that allows you to store, send and receive your cryptocurrency. But keep in mind, this wallet does not keep coins inside it like real notes or coins. Rather, it handles two important things: the public key and the private key.

Public key means your wallet address, which you can share with others.

Private key means a kind of password, which you cannot tell anyone.

If you lose your private key, then all your crypto will also be gone forever.

How does a crypto wallet work?

Cryptocurrency works on blockchain, which is a digital record. There is actually no coin in the wallet; rather, it connects to the blockchain and shows how much balance you have and where you are making transactions.

Suppose you want to send a cryptocurrency to your friend. You log in to your wallet and confirm the transaction with a private key. This detail goes to the blockchain; from there it is verified, and the cryptocurrency reaches your friend's wallet.

Types of crypto wallets:

Crypto wallets are divided into two parts – Hot wallets and cold wallets.

Hot wallets (wallets connected to the internet)

Hot wallets are those that are always connected to the internet. They are easy to use, but there is a greater risk of hacking.

 For example:

• Mobile wallet: Trust Wallet

• Desktop wallet: Exodus, Atomic Wallet

• Web wallet: MetaMask, Blockchain.com

The advantages are:

Quick and easy transactions, user-friendly interface

Disadvantages

There is a high chance of being hacked via the internet.

Cold wallet (wallet disconnected from the internet)

These wallets are not connected to the internet and are therefore considered more secure.

Example:

• Hardware wallet: Ledger, Trezor

• Paper wallet: Print the QR code or key on a piece of paper and keep it offline.

  The advantages:

Safe from hacking, better for long-term holding

Disadvantages:

A little expensive, there is a risk of losing the physical device.

Mobile wallet vs hardware wallet

If you are using a wallet for everyday transactions, then a mobile wallet will be fine. But if you are holding thousands or millions of crypto, then a hardware wallet is the safest option.

Custodial and non-custodial wallets

Crypto wallets are also divided on the basis of whether you have your private key or not.

Custodial wallet: In wallets like Binance or WazirX, your private key is with a third party. In such a wallet, recovery is easy if you forget the password, but the security is low.

Non-custodial wallet: In this, your private key is only with you. This means that the ownership of the entire crypto is in your hands, but if you forget your key or recovery phrase, then you will not be able to withdraw your coins.

There is a famous phrase in the crypto world: Not your keys, not your crypto., That is, if you do not have your private key, then your crypto is also not yours.

Why is a crypto wallet important?

 1. Security: To avoid hacking and theft

2. Convenience: Send and receive anywhere, anytime.

3. Full control: No third party, everything in your hands

4. Essential for Web3 and DeFi

5. Backup and recovery facility

Things to consider while choosing a wallet

• Security features like two-factor authentication

• Backup option (seed phrase)

• Which cryptocurrencies are supported

• Mobile app and user interface

• Trust and reviews

For example, if you are a Bitcoin user, then choose a wallet that supports Bitcoin, mining or in-app features.

Tips to keep your wallet safe.

1. Do not share your private key or seed phrase with anyone.

2. Enable two-factor authentication.

3. Download a wallet only from the official website or app.

4. Use a cold wallet for large amounts.

5. Always keep a wallet backup.

6. Beware of phishing links and fake endorsements.

Conclusion: A crypto wallet is not just a tool; it is your digital bank locker. Whether you are just buying Bitcoin or mining Di Coin, choosing the right wallet and its security is the most important step.

If you are looking for a future in crypto, then understand, choose and keep your wallet safe.