A Cryptocurrency Wallet is essentially a device, software, service, or program that stores the private and public keys for Cryptocurrency transactions. As well as this fundamental function of storing the private keys, a wide range of additional functions is available on some wallets. These additional functions can either be independent or tied into the main functionality of the wallet itself.
As with any other modern-day wallet, you need to take care to choose the correct wallet for waves for your needs. The selection criteria for selecting a suitable wallet should be primarily concerned with two factors: security and ease of use. However, there are some other considerations you may want to make as well:
It goes without saying that security is paramount in a Cryptocurrency wallet. This factor cannot be overstated as it makes up the very core of how your private key will be protected from unauthorized access by others. A majority of the best Cryptocurrency Wallets will ensure that their stored private keys are encrypted and there is always a layer of protection around them.
There should be an algorithm in place that will generate a response from the virtual machine upon request for your coins and then only allow access to your private key at authorized web pages. Some wallets have a “load balancing” mechanism whereby a certain amount of funds are kept on reserve in a dedicated pool and when a certain number of bitcoins are in use (by your configured parameters) then all excess funds are transferred to your private key. A good Cryptocurrency wallet will ensure that your coins are always 100% secure.
So you might have heard of different types of wallets and their characteristics. But what are they? The most popular and widely used Cryptocurrency wallet is the traditional client-server model wherein different types of information are passed between clients and servers via the Internet and storage is done on files, hard drives, and online databases.
While some networks do not support this model, most of them do as such many popular websites like Facebook and Twitter utilize the service. Most of the time, the information is encrypted to prevent hackers from intercepting your personal data.
Another type of Cryptocurrency wallet is the web-based model which is also quite popular and which stores your private keys on the Internet. This is more convenient, as all transactions are completed through the Internet. Web-based Cryptocurrency Wallets works just like a website and can be accessed using your Web browser.
This has the advantage of being fast and being able to send and receive large volumes of digital currency. However, with many public networks adopting the same technology, some people are finding it less private and secure since all transactions are conducted openly.
Lastly, you may want to use a desktop or laptop version of a Cryptocurrency wallet that does not use the Internet or any other network. These types are the safest as they store your private keys offline. However, some users feel a lack of security as your private keys are accessible to anyone who accesses your computer.