You have heard about cryptocurrency, but do you know what a cryptocurrency wallet is? If you want to know more about it, then you are in the right place. In this article, we will tell you everything you need to know about cryptocurrency wallet.
What is a cryptocurrency wallet?
To define it in simple words, a cryptocurrency wallet is a software program that is designed to store public and private keys. It interacts with different blockchains and allow users to receive and send digital currency. Not just that, but it also enables them to keep a check on their balance.
If you want to use any cryptocurrency like Divi coin, then you need to have a cryptocurrency wallet.
How do they work?
Cryptocurrency wallets are used by all cryptocurrency owners. Unlike traditional wallets, digital wallets don’t store any currency. They just store records of all the transactions that occurred.
Cryptocurrency wallets are software programs that are used to store both public and private keys. With the help of your digital wallet, you can receive and send money and also perform other operations.
When someone sends you cryptocurrency, they are sending it to your wallet’s address. To use these coins, you need to first unlock the funds. The private key of your wallet should match the public address the cryptocurrency is send to. When both the keys match, the balance in your digital wallet increases. At the same time, the balance in the sender’s wallet will reduce.
However, you should know that no actual coins are exchanged in the transaction. It’s only the transaction record that is store in your digital wallet.
Types of Cryptocurrency Wallets
There are different types of cryptocurrency wallets in existence. This include:
This type of wallets are installed on your laptop or PC. You can access these wallets only from a single PC. They offer the highest level of security in comparison to other types of wallets.
This type of wallets are run on your smartphone. The main advantage of these type of wallets are that you can use them from any place you want. They are smaller and easier to use.
This type of wallet is cloud based. They can be accessed from any computer device you want. However, they are more vulnerable than the other types of digital wallets.
Cryptocurrency wallets make transactions easy. But for the security of your transactions, you should choose the right cryptocurrency wallet.