Wallet

A wallet, or crypto wallet, is a digital wallet for crypto. It lets you receive, send, and manage crypto.

What is a wallet?

A crypto wallet doesn’t literally store your coins. Crypto is stored on the blockchain: a shared digital ledger that records transactions. The wallet stores the information you need to access your crypto on that ledger.

Your private key or seed phrase is especially important. Never share either one. Anyone who has this information can access your wallet. You can share your wallet address to receive crypto.

An example of a wallet

You want to receive crypto from a friend. You send them your wallet address. After they send the crypto, you’ll see it in your wallet.

Your wallet address works a bit like an account number. Your seed phrase is more like the key to a safe: always keep it to yourself.

Why is a wallet important in crypto?

Some wallets connect to the internet, such as an app on your phone. This is called a hot wallet. A cold wallet isn’t connected to the internet and usually stores the information needed to access your crypto offline. This makes it better protected against online attacks, but less convenient for quick use.

You can also use a wallet where a crypto exchange manages your secret keys. With a wallet you manage yourself, you’re responsible for them. If you lose your seed phrase or share it with a scammer, you could lose your crypto.

That’s why news about hacks, phishing, or problems at a crypto exchange often involves wallets and keys. This doesn’t automatically mean all crypto wallets are unsafe, but it does mean that handling your secret information safely is essential.