The demand for cryptocurrencies has increased exponentially with Bitcoin being the highest
and Ethereum being the second most valued and hence the need for crypto wallet. Not only
has these two cryptocurrencies become the best out of all, but they have also gained
popularity because of the increase in their demand and value.
People are fast venturing into this alternative form of investment, hence this article sets to give
beginners the necessary information to experience a hitch-free ride on this journey. If you are looking for the best Bitcoin exchange where you can buy and sell Bitcoin, then Naira direct and Exchange indeed are here to serve you.
What is a Crypto Wallet?
A crypto wallet is simply a tool that is used to interact with a blockchain. This is important because Bitcoin does not exist in a physical form, hence it cannot be stored in a physical place.
How Do Cryptocurrencies Truly Work?
Crypto wallets creates the necessary tools required for interaction with blockchains. What these wallets simply does is to generate important information needed to send and receive cryptocurrencies via blockchain transactions. Crypto wallet usually contains some information such as public and private keys, and also an alphanumeric address where the coins can be sent.
Types of Crypto Wallet
1. Software Wallet:
This types of wallet exist in various forms and they are usually connected in one way or the other with the internet (web, mobile, desktop).
- Web wallets
With a web wallet, you can access blockchains through a web interface, it doesn’t require you to download any software. Examples of this includes crypto
exchange like Naira direct and Exchange indeed.
- Mobile wallet:
These types of wallets are numerous, and they usually occur in software applications that can be run via mobile devices. Mobile wallet is very suitable for
sending and receiving cryptocurrencies, and are also fantastic for carrying out daily transactions. Examples includes Trust wallet, Pocket wallet etc.
- Desktop Wallet:
It’s a software that is compatible with your personal computer, and it allows you to easily download and conduct transactions with blockchains. The
advantage of the desktop wallets is that you have control over your funds and your private keys. The disadvantage, however, is that it is connected to the
internet, and anything internet based is prone to hacking.
2. Paper Wallet:
As the name implies, a paper wallet is just a document that contains a public address and a private key. The public key or address is usually used to receive Bitcoin while the private key is usually used to access your wallet. This is usually referred to as the most secured type of wallet because it stays unconnected from the internet, therefore it could be stored in a secret place where nobody knows about.
Having said a lot, it is important to note that crypto wallets are very volatile and failure to create a backup system can cost you everything. A wallet can be deleted or even lost, so save yourself a lot of trouble by investigating the best form of wallet you can use.