Introduction to the Cryptocurrency Wallet: Purpose, Performance, and History
The cryptocurrency wallet is on great demand these days; it is a unique application that allows users to store and retrieve their digital assets. This digital wallet helps you to store, send, and receive digital currency such as Bitcoin. It stores the records of transactions as well as the public and a private key that are used to perform transactions.
Many people get confused about the use and definition of cryptocurrency. See, it is just like those apps that run on your Smartphone or computer. If you like the tactile experience of having a wallet, you can purchase a physical device that runs a wallet app.
To use cryptocurrency, you just need a cryptocurrency wallet. It is a conventional currency, so you will not have to carry a wallet to spend your cash as it will help you to keep all in one place.
Some wallets are made for a single cryptocurrency and some are used for more than one coin. You can manage some wallets and some will be custodial.
History of Cryptocurrency
To understand the cryptocurrency wallet better, let’s go through its history. The first cryptocurrency wallet was introduced by Satoshi Nakampoto in the year 2009 when he first released the bitcoin protocol.
Present-day, Bitcoin has become the most famous and widely used cryptocurrency, but others building upon its blockchain technology have risen. And, you can store any in your cryptocurrency wallet. Wallets can hold many cryptocurrencies.
An Overview on its Work
As mentioned earlier, cryptocurrency wallets are software that is used to view cryptocurrency balance and do transactions.
Each wallet type is a little bit different, but generally, all wallets work with one or more cryptocurrencies and can send one or more cryptocurrency-specific “public address”. The public address is like a cryptocurrency-specific account number, and each address relates to all transactions related to that address on a coin’s blockchain.
Take your wallet as your online bank account platforms, your address is just like your account number, the blockchain is like the bank’s ledger, and with custodial wallets, the custodian is a bit like your banker.
Suppose, you wish to get cryptocurrency, whether by buying it in currency exchange or getting it as a gift or as revenue, you just need to send the sender your unique cryptographic address issued by the wallet.
Understand the Cryptocurrency Wallet through an Example
For Mother’s day, you want to send your mom some money. You decide to send bitcoin that has been appreciating in value. Your mother has a cryptocurrency wallet app on her phone and you already have your mother’s public address. The following May 10, you send one bitcoin to the public address. Once the transaction is authenticated on the blockchain, your mother becomes the owner of the bitcoin. Later, she wants to purchase jewellery online.
The e-commerce site aspects bitcoin and she directs a precise amount from her bitcoin wallet to the jewellery e-store and receives her jewellery in return.
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