A digital bitcoin wallet is a program that is necessary to work with cryptocurrencies and store savings in them through the blockchain. When dealing with it, you can not depend on the regimes of banking systems, quickly transfer funds around the world at any time and remain anonymous.
Despite the name, a bitcoin wallet is designed to store and operate a variety of cryptocurrencies, not just traditional bitcoin (BTC), which is periodically predicted to become obsolete and die.
Each wallet has a public public key and a private private key.
The first is the wallet address, a set of characters that is visible to everyone who sends funds to it, whether it be replenishment or transfers.
The private key is generated from random numbers, is closed from outsiders and is used to sign transactions.
The seed phrase memorized by the owner will help to restore the private key in case of loss - the same random sequence of words.
Wallet types
Desktop You can create a bitcoin wallet using a program and a database downloaded to your hard drive - for example, taken from bitcoin.org. A lighter option is to use special software like Jaxx or Exodus instead of full download and manual installation.
Mobile applications Special services and applications will help you to start a bitcoin wallet online. For example, Bitcoin Wallet, Blue Wallet, Samourai.
Hardware You can create a wallet for cryptocurrencies using a physical medium. Among them, models such as Trezor, Keepkey and the Ledger family stand out.
Paper Another “physical” way to get a bitcoin wallet is to use paper by printing out a seed phrase and a QR code with a private key.
Which cryptocurrency wallet to choose? To choose a wallet more efficiently, you should familiarize yourself with a specific cryptocurrency by looking at the list of recommended applications on its website. Different types of wallets have different advantages and disadvantages.
Desktop is considered safe, but difficult for users. Your wallet will be stored only with you, but you will need to download the database and make certain settings. For example, the required minimum specifically for bitcoin: a fast SDD disk, a bitcoin core with a list of transactions, and a wallet.dat key file.
A simpler option is to install programs like Jaxx or Exodus on a computer instead of a full database, but such wallets will require constant updating via the network, which makes them susceptible to hacker attacks and therefore blurs the very plus of this type of wallet.
Mobile applications will help you get a bitcoin wallet online, they are easily accessible and have a pleasant interface, it is convenient to transfer and check your account with them. But it is also relatively easier to hack the wallets created with their help - not only you, but also the platform has access to the wallet. In addition, you are tied to your smartphone, which can simply be lost in everyday use. With such pluses and minuses, mobile wallets are recommended for transactions with small amounts, as well as for very impressive ones.
A hardware wallet is secure and does not require internet, but you will have to pay a lot for it. These are physical devices, similar to flash drives, where software for storing cryptocurrencies is installed. Autonomy makes them a great option for both long-term storage and travel - just throw the currency on the device and take it with you anywhere in the world. In addition to the high cost, the disadvantages are appropriate: such a flash drive is easy to lose, and it will be impossible to recover funds if you lose it if you forget the seed phrase.
A paper wallet is considered very secure, but also very inconvenient. To use them, you need to print keys on paper and integrate them into an online wallet. On the plus side, the paper password cannot be siphoned off over the network and is usually stored in a secure location, like a safe. However, a technically important disadvantage of a paper wallet is that you can transfer from it only all the funds on your balance at once.