{"id":1394,"date":"2021-06-16T11:45:05","date_gmt":"2021-06-16T11:45:05","guid":{"rendered":"https:\/\/devza.com\/blog\/?p=1394"},"modified":"2021-11-15T16:17:02","modified_gmt":"2021-11-15T16:17:02","slug":"types-of-cryptocurrency-wallets","status":"publish","type":"post","link":"https:\/\/devza.com\/blog\/crypto\/types-of-cryptocurrency-wallets\/","title":{"rendered":"Cryptocurrency Wallets: Pros & Cons"},"content":{"rendered":"Reading Time: <\/span> 5<\/span> minutes<\/span><\/span>\n

Once you have figured out how to invest in cryptocurrencies, the next step is to pick out one or a combination of cryptocurrency wallets to store your keys.<\/p>\n\n\n\n

With different types of cryptocurrency wallets, opinions on what the best option is keeps varying from person to person.<\/p>\n\n\n\n\n\n\n\n

We list the various types of cryptocurrency wallets along with their pros and cons to help you make an informed decision.<\/p>\n\n\n\n

Before we get into it, you need to understand the concept of Public and Private Keys. This is because wallets essentially work on storing these keys rather than storing coins (wallets DO NOT store coins).<\/p>\n\n\n\n

Public & Private Keys<\/strong><\/h2>\n\n\n\n

Rule of Thumb : Cryptocurrencies are not exactly \u201cowned\u201d by someone who purchases them in the traditional sense of ownership. Rather, think of it as more like assuming control<\/em> of a certain amount of coins that exist in the blockchain network. You can manage it, move it around, make purchases with it, or convert it into fiat money.<\/p>\n\n\n\n

Private Keys<\/strong> – They are the gateway to unlocking your access to perform any of the actions mentioned above. Without a private key, it is impossible to access your assets within the blockchain network. Hence you have to ensure security of your keys. This is because anyone with access to your private keys gets access to your coins associated with those keys.<\/p>\n\n\n\n

Private keys act like the user\u2019s digital signature. As a result, every time you encrypt a message using the public key, your private key ensures that the message is coming from you.<\/p>\n\n\n\n

Public Keys<\/strong> – Your private key is used to derive the public key using complex mathematical algorithms. A public key is the key that senders can share with the receiver. <\/p>\n\n\n\n

Private and Public Keys always work in pairs for encrypting and decrypting messages respectively.<\/p>\n\n\n\n

The only difference is that public keys are more like your email address that you can share to the world to receive emails. Whereas, private keys are the password you need to authenticate your email ID, so that you can access your inbox.<\/p>\n\n\n\n

However, unlike your email ID and password, setting up a private key and public key requires a few extra steps. Learn more about private and public keys<\/a>.<\/p>\n\n\n\n

Types of Cryptocurrency Wallets<\/strong><\/h2>\n\n\n\n

Now that there is some understanding of what private and public keys are, let\u2019s check out the options we have for storing them.<\/p>\n\n\n\n

The TWO main categories of wallets are :<\/p>\n\n\n\n

Hot – Hot wallets require connectivity to the internet to function. There are 3 types of wallets that fall under this category: Web Wallet, Desktop Wallet, and Mobile Wallet.<\/p>\n\n\n\n

\n
\n
\n
\n