A crypto wallet is a software solution or a hardware device with which you can manage your cryptocurrencies. In fact, a crypto wallet is a storage of encrypted passwords for interacting with the blockchain in which the cryptocurrency is stored. Using the wallet, you can easily and quickly send or receive any token. Nowadays, crypto wallet for gambling is widely used by people around the World.
Cryptocurrency does not have a material form, like ordinary money, so the issue of the safety of such assets has its own specifics. Crypto wallets are used to store digital money.
The analogy with an ordinary wallet in which we carry hryvnias, dollars, or euros does not fit here since we physically own this money. The crypto is “stored” in the blockchain, a digital database that contains records of completed transactions. And cryptocurrency wallets are special programs or devices that provide user interaction with the blockchain, allowing you to receive and transfer coins. That is, crypto wallets store access keys to assets and not the coins themselves.
The main types of cryptocurrency wallets
According to the type of connection, cryptocurrency wallets are divided into hot and cold ones. The degree of security of keys and the speed of access to savings depend on the type of storage chosen. Let’s take a closer look at each of them below.
Hot wallets for storing cryptocurrencies
Hot is an online crypto wallet that is constantly connected to the Internet. Working ways:
- Web version. Bitcoin merchant account of this type functions like a regular site. Logging in is done using a username and password, while you can log in from any device. As a rule, such “wallets” are the easiest to hack, so they are recommended for temporary storage of small amounts.
- Program for PC. This is a special software for operating systems Linux, Windows, and macOS. They have a wide range of functionality. However, storing keys on a PC is not always a good idea since the device can be hacked.
- Mobile crypto wallets. These are dedicated apps for Android or iOS. With them, transactions can be carried out anywhere without being tied to a home computer. This type of storage can be further secured with a pin code, Face ID, and fingerprint scanning. Some crypto holders buy a separate smartphone to store crypto, install the necessary program on it and use it only to manage their coins.
- There are cross-platform crypto wallets that can be used both as web versions and applications for PC and mobile gadgets. These include Exodus and Jaxx. Providing access in many ways, such services reach a large number of customers.
Cold cryptocurrency wallets
A cold crypto wallet is a physical item that is used to store keys. They can be any storage medium, for example, a flash drive and even a simple sheet of paper. Yes, the latter is puzzling – how can an ordinary piece of paper become a crypto wallet? But it’s enough just to print the keys on it, and you get a kind of storage. This is an easy and cheap way to access assets. However, paper is easily torn and deteriorated under the influence of water or fire, the ink can burn out in the sun, and the crypto holder can simply lose a sheet of paper – and this will become a real problem.
Cryptocurrency hardware wallets have been created to securely store digital money. These are separate devices that look like flash drives but have a number of additional functions along with simple data storage. Typically, hardware storage is designed to be connected to a PC via a USB connector. However, connecting a crypto wallet to a phone is not difficult if Bluetooth is built into it.