A crypto wallet is a tool that stores the keys used to access and manage your cryptocurrency, rather than holding the coins themselves directly.
A crypto wallet is software or hardware that stores your private and public keys, letting you send, receive, and manage cryptocurrency. The coins themselves live on the blockchain; the wallet holds the keys that prove ownership.
Wallets come in two broad types. Hot wallets are connected to the internet and convenient for frequent use, while cold wallets, such as hardware devices, stay offline for stronger security.
There is also a custody distinction. With a self-custody wallet, you alone control the keys and bear full responsibility. With a custodial wallet, a third party like an exchange holds the keys for you.
Whoever controls the private keys controls the funds, which is why the phrase "not your keys, not your coins" is a core principle of crypto self-custody.
A trader might keep a small balance in a hot mobile wallet for quick payments, while storing the bulk of their holdings on a cold hardware wallet that never connects to the internet. The coins stay on the blockchain throughout; the wallets simply hold the keys that authorise moving them.
Not directly. Your coins exist as records on the blockchain. The wallet stores the private and public keys that prove ownership and let you authorise transactions, so it really holds your keys rather than the coins themselves.
A hot wallet is connected to the internet, making it convenient for frequent use but more exposed to online threats. A cold wallet, such as a hardware device, stays offline for stronger security and is better suited to long-term storage.
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