wallet and keys

By imfarhad | imfarhad | 8 Nov 2021

Hello and welcome to all the readers

Today, we talk about wallet and keys.

Wallets and keys are part of our daily life.
We use wallets to store cash and plastic (debit/credit cards) for day to day use. Whereas, keys can be defined as having house keys, car keys, safe keys, office keys or a combination.
They serve a purpose in our daily life.
Everyone has a wallet and a set of keys. If not then he/she is either broke or homeless :-)

Same way in the digital crypto world, wallets and keys have a purpose.

Wallets are used to store the different types of crypto currencies.
Whereas, keys are private and public addresses used to send and recieve the crypto currencies. They both go hand in hand.

The public key can be defined as an email address that you can share with others to send and recieve crypto currencies. While the private key is like a password, which unlocks your wallets and allows you to access the crypto held in it.
The private keys should never be shared and should be kept in a safe place away from preying eyes.

Categories of wallets

There are two categories of wallets available in the crypto world.

Hot wallets

Hot wallets are the wallets that are required to be connected to the internet. These wallets will be less secure due to vunerability and security threats.
But that doesn't mean they are bad. Hot wallets are user friendly and easy to handle.

Cold wallets

Cold wallets are crypto wallets which are not connected to internet. They are stored offline.

Types of wallets

There are different types of wallet available to store the crypto currencies.

Online wallets

Online wallets are wallets that allows the users to access the wallet through a web browser. They are vunerable to security threats. Its advisable not be store a big amount of crypto currency in online wallets.
Examples - coinbase.com, Uphold.com
Another thing to be aware of that the private keys are held by the owners of the website. In case the website goes bust or hacked, you may lose everything.
These wallets are easy to use.

Mobile wallets

Mobile wallets are the wallets that can be downloaded and installed into mobile devices. These wallets allow users to send and recieve cryptocurrencies through mobile devices. Since it's connected to internet, they are also vunerable to security threats.
But, mobile wallets are generally easy to use. The good part is that you hold the private keys.
The keys should be backed up properly. As in case the mobile crashes or dies, you will lose everything.
Before installing any mobile wallet be sure to check for any known software vunerabilities

Hardware wallets

Hardware wallets are generally in a form of a keyfob with the wallet software in it. These type of wallets provide a good securty.
The wallet is generally offline and only connected when you need to send or recieve crypto currency.
They also provide encryption and you own the private keys.

Desktop wallets

Desktop wallets are wallet software provided by third party vendors or specific crypto currency community.
The software is easy to install on the desktop and convenient to send and recieve various crypto currencies
examples - atomic wallet, bitcoin.com wallet, dogecoin wallet etc.
The private keys in the desktop wallets are owned by you. Most of the desktop aallets have inbuilt backup and restore facilities.
Before installing desktop wallet be sure to check for any known software vunerabilities.

Paper wallets

Paper wallets is one of the most secured offline way of storing your crypto currencies. It is your responsiblity to keep it safe.

Finally, A word of caution. In the normal world if you lose your wallet or keys. Duplicate keys can be made or replaced. Door locks can be changed. Credit and debit cards can be cancelled and re-issued.

But, in the digital world, if you lose your keys you lose your access to the wallet, and there is no way to can get it back.

So, always take a backup of your keys and store them in a safe place completely offline.

Thank you for reading my post.

Have a nice day.


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