Everything About Blockchain & Blockchain Wallets
The evolution and rise of cryptocurrencies or digital currencies and related activities are changing an array of industries such as finance, healthcare, and many more with the speed of light. Cryptocurrencies are causing a spur with their skyrocketing value. And due to this, the demand for a safe, secure, and reputable wallet is also escalating.
A blockchain wallet is one such wallet that meets the criteria of the best cryptocurrency wallet. Most of the people are doubtful about how exactly these blockchain wallets should work, how secured transactions are, how they store digital currencies, and so on. The following blog shares insights about Blockchain, Blockchain wallets and its related aspects (How does it work, security, development, etc).
What is blockchain? A brief look.
In the most simple terms, blockchain is a chain of blocks. The ‘blocks’ are the digital information whereas the ‘chain’ is the public database. The blocks in the blockchain are made up of digital pieces of information which are stored in a public database. Specifically, they consist of three parts:
- Blocks have all the information about the transactions (like date, time, and amount).
- Blocks consist of all the information of the user participating in transactions. Your purchase does not use your actual name but using a unique ‘digital signature’, like a username.
- Each block stores different information that distinguishes them from other blocks. The block stores a unique code known as ‘hash’ that separates it from every other block. Though the details of each transaction are nearly identical but can be identified as separate because of their unique codes.
When a block stores new data, it is added to the blockchain and it becomes available for anyone to view. On the whole, Blockchain tries to improve information security as well as transparency by sharing encrypted data amid peer-to-peer (P2P) networks.
What are Blockchain Wallets?
A Blockchain wallet is a software program that allows users to buy, sell, and monitor their digital currency (or assets or cryptocurrencies). If you are ardently into cryptocurrency exchange, then you must use a Blockchain wallet. Blockchain offers different types of wallets that are discussed in the next section.
Blockchain wallets keep a record of all the transactions (sell, buy, exchange) related to the cryptocurrency and store them on Blockchain.
How do Blockchain Wallets work?
Public and private keys (non-identical pairs of large numbers in which one key can be shared with anyone and the other is kept a secret) are stored in a cryptocurrency wallet for the transaction. This wallet interacts with various Blockchains to confirm or accept a transaction, thus enabling users to purchase or sell one or more than one cryptocurrencies.
A blockchain wallet is widely recognized and preferred due to its best in class security. It makes sure that your crypto is fully secured giving you full control, backs up your funds, and protects them from unauthorized access. You become your own bank with the blockchain wallet.
What are the types of blockchain wallets?
Basically, there are three types of cryptocurrency wallets which store and reflect a transaction on the Blockchain.
1. Software Wallets
These wallets can be downloaded on a device or can be accessed online. Further, these wallets are categorized into three types depending upon the type of device. They are as follows-
Desktop: You can download these wallets on a PC or a laptop. This can only be accessed from the system they are installed on. They are a safe choice given that your system stays protected against virus attacks.
Online: These wallets run on the cloud and hence you have the advantage of accessing them from any device through a web browser. However, since the private keys for a transaction in these wallets are saved online and controlled by the third-party, it becomes a vulnerable option to pick them.
Mobile: Mobile wallets are available as a mobile application making them accessible anytime and anywhere. Also, the ability to scan QR codes offers easier and faster transactions. It is the most popular choice amongst the three software wallet categories.
- Hardware Wallets
Hardware wallets keep private keys of the users on a hardware device. The hardware wallets are compatible with various web interfaces and offering support to multiple cryptocurrencies. In order to use them, you need to connect them to any internet-enabled device, enter the pin, and confirm. Hardware wallets store all currencies offline and hence, are the securest wallet options available.
- Paper Wallets
The public and private keys are generated with a software application and then printed to make a transaction in the paper wallets. To buy and sell assets, paper wallets generally work with software wallets. The assets are transferred from software wallets to a public address on paper.
To unlock the funds, the cryptocurrencies are transferred from paper to software wallet. You can either scan the QR code or add the keys manually.
While, in the crypto sphere, there is no such thing as 100% secure. All you need to adopt is adequate security measures, pick any of the three software wallets, and sit back and relax. Moreover, the number of cryptocurrencies is growing at a fast rate. If you are dealing with multiple currencies for receiving or transferring funds, there is no need to have a separate wallet for every currency. It will be daunting to handle so many wallets. It is highly recommended to go for a multi-currency wallet which is a better and flexible choice. Call us Now! – 18889087930