Cryptocurrency wallet which is in the form of a software like the Bitcoin Trader app. It plays a significant role in receiving and sending cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH).
In addition, it is also capable of storing records of each transaction, the private and public keys that are commonly used to conduct transactions.
The public key which is found to be the same as the account number. When you use bitcoin to send money to someone, you will first need to send that person's public key address.
The public key can be used by somebody to send bitcoins and on the other hand, if we talk about a private key, it is considered similar to an account password. You can also use the private key if you want to send money to someone. Public-private keys that stay together are fortified even more present.
Storing cryptocurrency
There are several methods for storing crypto, some of which are described here.
Hot Storage: First of all, we'll know about hot storage. It is a storage which is fully connected to the internet, due to which it accesses money easily and quickly. Other than this it is competent and able to succour in daily transactions. But, with this comes the likelihood of harm.
It is considered more vulnerable to cybercrime and hacking. If you ever lose your private key, it can be arduous to expedience access to the coins. On the contrary, If anybody larceny of your private key, your coins can be wasted perpetually. There are different types of hot storage wallets: mobile wallets and online (cloud).
Mobile wallet: These are wallets that are capable of providing superior protection than online wallets at the cost of Facility. However, it can be easily used by anyone as you can use them by installing an app on your mobile phone. However, if your phone ever breaks down, it will not be able to access the funds.
Online Wallets: These wallets are capable of providing the most convenience but at the same time they are also considered insecure. It is commonly used to store the private key and record of each transaction online in a secure manner. Online wallet which should be utilised to store money such as a short amount.
Cold storage: Second cold storage This is such a storage, which is not connected with the internet. It is available as offline storage. Compared to hot storage, a higher level of security is provided by cold storage. Unlike hot wallets, it is considered useful for long-term storage.
It is not considered ideal for daily transactions of any kind. Although it is quite safe, if seen, it is very vulnerable to external disservice and harm. There are different types of cold storage wallets which include paper wallets and hardware wallets.
Paper wallet: Here, if we talk about paper wallets, they are competent in providing the highest level of protectiveness, unlike all other wallet types. Private keys are stored securely on paper after which they are kept in a secure location known only to those who are trusted. Paper wallets are completely protected from attacks like hacking and malware.
Hardware wallet: Here if we talk about hardware wallet, it is used to store funds/coins on the hardware device. Unlike hot wallets, an offline device is used when it comes to storing the private key, but an internet connection is a must if every transaction is to be performed. If we compare hardware wallet with hot wallet then it is capable of providing a much higher level of security than this.
