A cryptocurrency wallet is a tool that allows you to send/receive and store cryptocurrencies quickly, safely, and securely. Digital wallets typically consist of 2 key pairs: a Public Key and a Private Key, which prove ownership of your cryptocurrency and allow you to make transactions.
- Public Key (Wallet Address): A string of random characters, including numbers and letters, serves as a wallet address to receive cryptocurrency from elsewhere. A wallet can include many different public keys.
- Private Key/Passphrase: The Private Key is also a string of random characters, including letters and numbers, connecting to each wallet account. Meanwhile, a Passphrase is a random 12-24 word phrase used to encrypt wallet information.
For example:
- Public key: 0x37jnrksn5lodfnc0rnld95rjfkeEFksnl3503k6nEMXd85e
- Private Key: 6Pm7KnogidDA76MzPL6TsZZY36hWXMssSzNydYSNGz
- Passphrase: rabbit solve foot code labor into outside monogram truck poison between moonlight
Careful storage of your Private Key is essential because this is the key for you to access and manage the assets. If someone knows your Private Key, they can completely access and make transactions to send/receive cryptocurrency on your wallet. Or, if you lose your Private Key, your property is also highly likely to be lost forever.
Types of Crypto Wallets
- Software Wallet (Hot Wallet): A software wallet can be easily installed on your computer or phone, even integrating with popular web browsers on the market today. Software wallets allow you to transact anytime, anywhere quickly as long as you have the Internet. However, the feature also makes software wallets less secure and more susceptible to attacks from hackers, leading to asset loss.
- Paper Wallet (Cold Wallet): A paper wallet is a piece of paper containing both the Public Key and the Private Key encoded into a QR Code to support cryptocurrency transactions. When it is necessary to extract the Key for a transaction, all information about the key is deleted from the Internet immediately. Although it was only famous in the era when cryptocurrencies were not yet prevalent, many people still consider it a highly secure method of storing assets at the moment.
- Hardware Wallet (Cold Wallet): A hardware wallet is a compact, portable device that is easy to carry around and is completely offline (separate from the Internet). Because it does not connect to the Internet or 3rd party applications/services, hardware wallets have very high security. Still, the disadvantage is that it is pretty expensive, challenging to use for newcomers, and complicated transaction implementation.
Some popular Crypto Wallets
- Trust Wallet: Trust Wallet is a decentralized cryptocurrency wallet belonging to the Binance ecosystem. Trust Wallet supports trading and storing many of the major cryptocurrencies on the market and integrates directly with many dApps allowing users to have easier access to the world of DeFi.
- Metamask Wallet: Metamask Wallet is a wallet built on the Ethereum blockchain platform that allows users to store, send/and receive cryptocurrencies anywhere through a mobile app or browser extension. Metamask currently supports many blockchain platforms such as Ethereum (ETH), Binance Smart Chain (BSC), Avalanche (AVAX), Polygon (MATIC)…
- Ledger Wallet: The Ledger wallet is the most secure form of hardware wallet today, storing private keys offline, wholly isolated from the Internet environment to avoid hacker intrusion. Ledger wallet produced and released by Ledger – a leading company in security and infrastructure solutions for blockchain applications.
- RICE Wallet: RICE Wallet is a cryptocurrency storage wallet that helps users access and explores the decentralized financial (DeFi) market more quickly and securely. RICE Wallet brings carefully selected dApps, optimized for UX/UI, and many other outstanding features such as Redemption, On-chain transaction fee refund, gas fee reimbursement, rewards,…
Each type of cryptocurrency wallet will be secured differently and have its pros/cons. Hopefully, this article has provided the necessary information to help you choose the right wallet for your needs. Regardless of the type of wallet you use, you need to be extremely careful with your Private Key to avoid revealing information or losing it, leading to property loss.
