What is a Crypto Wallet?
A crypto wallet is similar to a bank account that stores all your cryptocurrency and keeps track of all the debit and credit happening from your account.
A crypto wallet or a cryptocurrency wallet in simple words is like a digital bank account with no intermediary, where you can send, receive and manage cryptocurrencies.
Any crypto transactions are done on a blockchain using public and private keys. These keys resemble your account number and password.
When you set up a personal cryptocurrency wallet, it creates your public and private keys and interacts with the blockchains to display the right amount of cryptocurrencies you own. The crypto wallet is the bridge between you and your crypto funds that are originally on the blockchain.
There are various crypto wallets available in the market today. Many users prefer hot wallets and some prefer cold wallets.
A cold wallet is a physical device which stores information on the private and public keys. As it is a physical device itself that stores your information, to access your account on any computer, simply plug in the device. In other words, cold wallets are available offline, it does not require an internet connection. These types of wallets are safer and more suitable for people with intentions to invest in cryptocurrency for the long run.
A hot wallet refers to a digital wallet connected to the internet and, therefore, the data is only accessible online, for example, Klever App. If you want to trade on Klever Exchange, you can connect to Klever’s hot wallet. Hot wallets are most convenient as you can set them up easily and they are much simpler to use when you want to trade with direction from the site you are on.
Lets us check some details about types of hot and cold wallets
There are different wallets that fall under the hot and cold wallet categories. Let's check three types of cryptocurrency wallets that include hardware wallets and paper wallets also known as cold wallets, and software wallets like desktop wallets, web wallets, mobile wallets also known as hot wallets.
A hardware wallet also known as a cold wallet is a physical tool that can retrieve all information once plugged into any computer. Klever is working on this and will be soon launching its own hardware wallet which can be handy and very convenient to carry along anywhere.
When you connect this wallet to the internet, you can obtain your crypto assets from any blockchain network on any site. The private key consists of a pin and an optional recovery phrase and to access your cryptocurrencies. You need to only have access to your private key.
Klever Hardware wallet is going to be a good option if you plan to invest in cryptocurrencies for the long run, as you are the only one that can access your private key. It is also considered as the most convenient, as you can access all your crypto-assets easily on any device.
A paper wallet physically holds your crypto address and private key. You can access it by means of QR codes. These codes are scanned to carry out transactions. However, with paper wallets, you can’t send a portion of the cryptocurrencies in your wallet, you can only send the entire amount in your wallet at once. Although the feature of paper wallets seems complicated and inconvenient, it is one of the most secure wallets.
Unlike hardware wallets, software wallets also known as hot wallets are always connected to the internet. In other words, storage of the security information necessary to access one’s crypto assets is not in any separate physical device, but rather online. The most popular software wallets are web, desktop, and mobile wallets.
Often accessed through a browser, Web wallets are another form of hot wallet that doesn't require installation on the computer. Usually, to access the wallet one needs a password. Many web wallets have service providers that manage passwords and, therefore, they can manage your private key with your password. Some service providers allow private keys to be managed solely by the user and some offer shared control.
A desktop wallet is one that needs to be downloaded onto a computer. With a desktop wallet, one has total control over their private key. Computers can hold viruses and, therefore, it is vital to make sure your computer is clean before setting up a cryptocurrency wallet.
Mobile wallets are essentially mobile applications which enable one to send and receive cryptocurrencies through the scanning of QR codes. Since these wallets are mobile, they are most suitable and convenient for carrying out our daily transactions. Mobile wallets should be backed up in case mobile gets lost or stolen.
Whichever wallet you select you need to Kleverly check which wallets suit your requirement. Klever provides a second-to-none hot wallet, Klever App, and our innovative Hardware wallet is coming soon.
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