When it comes to crypto currency, a wallet that helps to load and use such currency is also required. This is a software application that helps to store private as well as public keys and can interact with different Blockchain technologies which enable users to send or receive different kinds of digital currency as well as be able to monitor the balance they have. For those who use Bitcoin or other forms of crypto-currency will need a digital wallet alongside as well.
How crypto currency wallets work?
Though crypto currency wallets are varied and many people use them, many are unsure of how these wallets work. They are not digital wallets where one can store currency. In such wallets currency is not stored or to be found to lie around. There are simply transaction records that are maintained in such wallets with the help of Blockchain technology. For such reasons crypto currency wallets are simply software programs that store private and public keys and act as an interface with Blockchain technologies. This enables users to check their balance and conduct different kinds of monetary transactions. A person can send another Bitcoins or other forms of digital currency and that is akin to signing of ownership of part of the coins from one’s wallet which is akin to an address. The coins that are sent across or the funds that are unlocked can be spent only when the private key in one’s wallet matches the public address of the currency that has been transferred.
The transactions that happen are merely records of transactions that are maintained on the Blockchains and reflect on the balance of one’s wallet for crypto currency.
Different kinds of crypto currency wallets
There are different kinds of crypto currency wallets out there that have the following features:
- Online
This category of wallet usually runs on cloud and can be accessed by any computing device. These are convenient to access from anywhere and are controlled by a third party service provider.
- Desktop
This category of crypto currency wallets is accessible on a computer where the software program is downloaded. These are known to offer greater security than cloud based applications.
- Mobile
There are wallet apps that can be downloaded onto mobile devices. These are beneficial and can be used at retail stores and other places on the go.
- Hardware
Wallets of this category are akin to USB like devices. These usually have crypto-currency stored in them and one can make transactions online as well as offline. These wallets usually work with different currencies as well as diverse web interfaces.
- Paper
These kinds of wallets are basically printout or physical copy of private or public keys. Such a wallet can help transfer any kind of crypto-currency by transfer of funds with the help of the public address that is shown on one’s paper wallet.
It is necessary that one chooses the right kind of wallet as per the ease of use, the kind of transactions one wishes to do as well as security and other benefits a wallet offers.
