🔐What is a wallet or virtual cryptocurrency wallet?🔑
Cryptocurrencies are completely digital currencies, but we need a space to store them, which are known as wallets. They work just like a fiat money wallet; you can use it to receive or send payments.
Due to the nature of cryptocurrencies, most wallets are digital, which can be apps for mobile devices or PCs.
🔐What are public and private keys?
Just as in traditional banking there is a bank number and a key or password to access it, in cryptocurrencies something similar happens, as we will see next:
🔑Public Key: If we continue with the bank analogy, the public key is your bank account number, which you can give to anyone if you want to receive a transfer or payment.
🔑Private Key: This is essentially the password to your account, which you should not share with anyone.
🔐Types of cryptocurrency wallets
There are many options for wallets to store your bitcoins, but to understand it better, we will classify them into two groups.
🔑Hot Wallet
This type of wallet is characterized by being connected to the internet; it can be a mobile app on your phone, a browser extension, or a wallet on an exchange.
🔸Centralized: Centralized wallets are those controlled by a company or institution.
🔸Decentralized: These are wallets where you can store your bitcoins and where you are also responsible for keeping them safe.
🔑Cold Wallet
Hot wallets are not connected to the internet; they are hardware devices, similar to a USB, where cryptocurrencies are stored. This type of wallet is considered the safest, and you can buy and sell cryptos easily; however, these wallets do not support cryptocurrencies from the ecosystem.