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What is an e-wallet?

What is an e-wallet? The best crypto wallets

What is an e-wallet? What types of crypto wallets are there on the Crypto market? Find out the Top 8 Best Crypto Wallets 2021 right here!

In this article, we will learn all about cryptocurrency wallets – wallets used to store cryptocurrencies (coins & tokens).

This is an extremely important component in the Crypto trading process, where it helps you to store assets, send and receive your assets.

Through this article, idolmeta.net will help you understand:

  • What is an e-wallet?
  • Components and Operation of a Cryptocurrency Wallet.
  • Categorize and introduce Top best crypto wallets 2022.

What is an e-wallet?

A cryptocurrency wallet is a software that helps to store, send, receive and track the balance of cryptocurrencies such as coin/token within it.

Simply put, a cryptocurrency wallet is like a bank account. The main difference is that this wallet has higher security thanks to the information encryption mechanism, does not identify the owner of the wallet and the money stored in the wallet is a cryptocurrency.

The composition of the Cryptocurrency Wallet

When creating a cryptocurrency wallet, you are provided with 3 codes, corresponding to 3 components: Address, Private Key, Passphrase

Address – Wallet address

Address (wallet address, also known as Public Key) is a random string of alphanumeric characters. A wallet address is like a bank account number, when someone sends cryptocurrency to your wallet, they will send it to this wallet address.

Public Key is considered as the user’s identity address on the blockchain network and corresponds to the wallet address (Address).

Wallet addresses of different Blockchains will have some different configurations. For example, Binance Smart Chain and Ethereum are both EVM Compatible, so it will start with 0x…, but with Solana or BTC it will be a random string of characters.

Example of wallet address: TPza8tkcTfGa4XzyZoMbGEjpuyaBUJBsN9

Private Key

Private Key (also known as private key) is also a random string of alphanumeric characters to connect to the wallet.

If the wallet address is considered a bank account number, then the Private Key will be considered the password for you to log in to the wallet. The difference here is that the bank password can be changed, while the Private Key cannot.

When setting up a wallet on any platform, you will also be asked to store your Private Key, so store it carefully, as this is the only key that gives you access to your crypto wallet. me.

Unlike the Address, the Private Key will not have any structure, but just a string of irregular characters, whether it has the same Blockchain structure or not.

Private Key Example: 5Kb8kLf9zgWQnogidDA76MzPL6TsZZY36hWXMssSzNydYXYB9KF

Important note:

  • Protect and do not reveal the private key to anyone, it is recommended to write it down on paper and keep it in a safe place.
  • Losing the Private Key is considered a permanent loss of money.

Difference between Public Key (Address) and Private Key

Passphrase

Passphrase is also a form of private key, consisting of 12 or 24 random English words, but depending on the decryption mechanism in different wallets, the passphrase will give different wallet addresses.

Example of Passphrase: convince between inside solve into slam labor warfare demand song october tram.

With the same Passphrase as above, but:

  • When using Trust wallet, this wallet address will be issued: TPza8tkcTfGa4XzyZoMbGEjpuyaBUJBsN9
  • When using Coin98 Wallet, this wallet address will be issued: PLza5cklTfGa4XzyZoMbGEjpuyjshfkHFHS9N9

Because the two wallets have different decryption mechanisms, they will give different wallet addresses, so you must remember which wallet your Passphrase was generated from.

The advice for you is that you should store both the passphrase and the private key to prevent any possible situations.

To solve the above complexity, some wallets have been programmed to be able to decode the correct Passphrase with another wallet

However, to solve this requires knowing how other wallets work, so it is not easy to update.

Learn more: What is a Private Key and Passphrase? The safest and most secure way to store

How crypto wallets work

When creating a wallet address on the blockchain, you will receive two keys including Address and Private Key. To make it easier for you to imagine:

Address is like an email address, and Private Key is like an email password. And the email messages correspond to money or data inside.

You receive mail from other people, you can notify them of your email address. Anyone with this email address can email you.

And just like email, if the password is revealed to anyone, that person can access your email and send an email (transfer money out). So keeping the Private Key is very important.

How crypto wallets work

Nowadays, scams are becoming more and more popular. For old people, it’s okay, but newcomers to this market do not fully understand the importance of keeping the above information secure, so it is easy to be scammed and lose all their money.

Please note: Do not reveal your Private Key or Passphrase to anyone, even if it is the admin of any group.

If they are real admins, they will never ask you to provide Private Key or Passphrase (Address can be used to check support).

Types of Cryptocurrency Wallets

According to the degree of asset control

1. Centralized Wallet

When you participate in transactions on centralized cryptocurrency exchanges like Binance, Kucoin,… you will create a trading account on the exchange, in that account, the exchange has created wallets for all coins/ tokens listed on the exchange.

You just need to choose the right coin/token you want to deposit, then copy the wallet address and send money in.

For example: On binance exchange, you just need to go to Wallet ⇒ Fiat and Spot ⇒ Choose the coin/token to deposit/withdraw and execute the order.

In this wallet case, you don’t need to save your private key, you just need to remember your exchange account password.

Advantages:

  • No need to create a wallet, just create an account.

Defect:

  • The level of security is not as high as that of a decentralized wallet.
  • Your assets will be 100% controlled by the exchange.
  • Risk from 3rd party (exchange) if problems occur.

Binance exchange wallet

2. Decentralized wallet

Hot wallet: A type of wallet that can be traded whenever you want through an internet connection.

Advantages: Free, more diverse options and can be connected via mobile App or Browser Extension.

Cons: Easier to hack than cold wallet because data about Private Key is stored right in App or Extension and always connected to network, so hackers are easy to attack.

Cold wallet: Usually in the form of a USB, and works like your bank account.

Cold wallet automatically receives money when someone sends it to you without having to connect to the internet, but if you want to check balance fluctuations, you need to connect a cold wallet to the internet like internet banking.

Advantages: Higher level of security.

Defect: High cost & lack of flexibility.

Compare Hot Wallet and Cold Wallet

According to the number of supported platforms

Multiple chain: Also known as Multi-chain Wallet, can support many different blockchain digital assets at the same time. Multi-chain wallets are easier to manage crypto assets because only 1 passphrase needs to be stored for multiple wallets.

For example: Coin98 Wallet supports storing coins/tokens of many different Blockchains: Bitcoin, Ethereum, TomoChain, Binance Chain, TRON, Solana, Celo, Binance Smart Chain, Polkdot, Near, Kusama, Huobi Eco Chain, Avalanche…

Single chain: Also known as single chain wallet, can only store, send and receive coins or tokens of a particular blockchain. More security than multi-chain wallets.

For example, Bitcoin’s official Bitcoin Core wallet, which only supports BTC storage and transactions.

Top best crypto wallets 2022

Exchange wallet

Binance exchange wallet: One of the most popular exchanges today, currently supports many popular standards such as ERC-20, TRC-20, … and even the extremely popular BEP-20 (Binance Smart Chain) that not many exchanges support. aid.

FTX exchange wallet: The exchange was established in 2019, in addition to popular standards such as ERC-20, TRC-20, FTX is known as the best exchange for all tokens of the Solana ecosystem, so if you I want to store Solana’s SPL standard token, FTX can’t be a better place

Kucoin exchange wallet: Excluding popular standards, Kucoin is considered the earliest exchange that supports Terra and Celo’s token standards.

Hot storage wallet

Trust Wallet: One of the wallets born quite early, used by many brothers. However, it does not support too many token standards.

Coin98 Wallet: Supports over 20 chains, always updating the hottest chains according to the trend, so you can rest assured that almost any token can be stored in Coin98 Wallet.

Metamask Wallet: Metamask is famous for its browser Extension, which is integrated with nearly all Crypto dapps. The minus point of Metamask lies in the inability to store the standard variety.

Cold storage wallet

Cold storage wallet I will talk about two representatives: Ledger Wallet and Trezor Wallet. Except for the difference in wallet material (Trezor is plastic, Ledger is metal), and the support is slightly different in terms of properties, the rest of the things are not much different.

Epilogue

The article has shown you the overview of cryptocurrency wallets, now you can choose the most suitable crypto wallet by yourself to be able to conduct transactions and easily store, send and receive crypto assets already.

If you have any questions, just comment below Idolmeta.net will try to answer them all for you.

 

 

 

 

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