Types of cryptocurrency wallets and their overall security aspect

There are different types of cryptocurrency wallets that allow users to store and access their digital currencies in different ways. The question that is relevant in this context is how secure these wallets are. Before we deal with the security aspect, it is useful to understand the different types or variants of cryptocurrency wallets that exist today.

Cryptocurrency Wallet: Types and Variants

These wallets can generally be classified into 3 categories:

  • Software wallets
  • Hardware wallets and
  • Paper wallets

Cryptocurrency software wallets can be re-divided into desktop, online and mobile wallets.

  • Desktop software wallets: These wallets are designed to be downloaded and installed on desktops and laptops. This special variety offers the highest level of security, although their availability is limited to the computer in which they are installed. Moreover, in case the computer is hacked or infected with a virus, there is a possibility that someone will lose all their money.
  • Online software wallets: This range of cryptocurrency wallets works in the cloud. Therefore, they can be easily accessed from any computer device and from any geographical location. In addition to the convenience of accessibility, this type of digital wallet keeps private keys online. The keys are even controlled by third parties; this makes them easily vulnerable to hacking and theft.
  • Mobile software wallets: Unlike the other two variants, mobile software wallets work on smartphones via the app. They can be easily used everywhere, including retail outlets and shopping malls. This range of wallets is usually much simpler and smaller compared to normal desktop wallets to accommodate the very limited space on mobile devices.

The difference between hardware and software wallets

Hardware digital wallets differ from software wallets in terms of storing users’ private keys. Hardware wallets store user keys in a hardware device (for example, USB). Therefore, as the keys are stored offline, these wallets offer additional security. Moreover, hardware wallets are easily compatible with many online interfaces and can handle different currencies. This type of wallet with cryptocurrencies is also easy to conduct transactions. As a user, all you need to do is connect the device to any computer connected to the web before entering the PIN, switch the currency and just confirm the transaction. Your digital currency is kept offline by hardware wallets and therefore the risk factor or security problem is also much smaller.

Digital paper wallets: This range of digital wallets is also easy to use and provides a high level of security. The term “paper wallet” only refers to a printed copy of a user’s public and private keys. However, with respect to instances, it can also refer to a software application that is designed to securely generate keys before printing.

Cleaning with paper wallets

Using paper wallets is relatively easier. To transfer any cryptocurrency to your paper wallet, simply transfer funds from the software wallet to the public address displayed by your paper wallet. Similarly, when you want to spend or withdraw your money, just transfer funds from your paper wallet to your software wallet. This procedure is popularly called ‘sweeping’.

Cleaning can be done manually, by entering private keys or by scanning a QR code on a paper wallet.

How secure are cryptocurrency wallets

Different types of digital wallets offer different levels of security. The security aspect mainly depends on two factors:

  • The type of wallet you use – hardware, paper, online, desktop or mobile
  • Selected service provider

Not to mention, it is much safer to keep currencies in an offline environment than online. There is simply no way to ignore security measures, no matter what wallet you choose. If you lose your private keys, all the money in your wallet will disappear from your hands. On the other hand, if your wallet is hacked or you transfer funds to a fraudster, it will not be possible to cancel the transaction or return that money.

Investing in cryptocurrencies is a smart business idea and for that, using the right wallet is inevitable. You just need to be a little careful to ensure the security and safety aspect of your asset transfers and transactions.

Bitcoin wallets – all aspects explained


Bitcoin is a well-known digital currency and is different from the physical or traditional currencies used around the world. This is a completely different type of currency because it does not exist in any physical form or form in the world. They are basically technically stored and used in the world of the internet. If you want to use bitcoin, you need to have a bitcoin wallet.

What is a bitcoin wallet?

In general, Bitcoin Wallet is a software program in which bitcoins are safely stored. A wallet is similar to a virtual bank account and allows a person to send or receive bitcoins and keep them. Those people who use bitcoin and have a balance, get a private key or secret number for each bitcoin address stored in the bitcoin wallet. Without a private key, bitcoin transactions are not possible. You can use your Bitcoin wallet from anywhere in the world.

The main reason for getting a bitcoin storage wallet is to use bitcoin easily and securely. It is a digital wallet that can easily work on your smartphone and computer devices. If you are worried about hacking, then this is the best option because it gives complete security and safety of your bitcoin.

Different forms of bitcoin wallets

There are several different forms of bitcoin wallets and each one is used according to their requirements.

The four main types of bitcoin wallets are listed below:

• Mobile

For those who use bitcoins on a daily basis, such as regular trading, shopping for goods and other daily activities, for them the Mobile BTC wallet is a great option. It is an application that works on your smartphone. This will store your private keys and allow you to easily pay for things or use cryptocurrencies from your phone from anywhere in the world.

• Web

Web wallets allow you to easily use bitcoins from anywhere and on any mobile device or web browser. Remember, you need to choose your web wallet carefully because it stores your private key online and can sometimes be risky.

• Desktop

Desktop wallets are downloaded and installed on your computer or desktop and offer you complete control over your wallet. You can store the private key and create the crypto coin account address to send and receive bitcoin.

• Hardware

Hardware wallets are offline devices and are the most secure bitcoin wallet. They store your private keys offline so they can’t be hacked. This means you can use it whenever you want on your computer.

Your coins are completely safe because only you can control your bitcoin wallet. No other person, unless you share a password, can get details about your bitcoin. Therefore, use bitcoin without worrying about theft.

Basics of cryptocurrency and the way it works

In the times we live in, technology has made incredible advances over any time in the past. This evolution has redefined human life in almost every aspect. In fact, this evolution is an ongoing process and therefore human life on earth is improving day by day. One of the latest inclusions in this aspect is cryptocurrencies.

Cryptocurrency is nothing but digital currency, which is designed to impose security and anonymity in online money transactions. It uses cryptographic encryption both to generate currency and to verify transactions. New coins are created by a process called mining, while transactions are recorded in a public ledger called the Transaction Block Chain.

Little backtrack

The evolution of cryptocurrency is mainly attributed to the virtual world of the web and involves the procedure of transforming readable information into code, which is almost inexplicable. This makes it easier to track purchases and transfers that involve currency. Cryptography, since its introduction in World War II to ensure communication, has evolved into this digital age, merging with mathematical theories and computer science. It is therefore now used to secure not only communication and information, but also the transfer of money via the virtual web.

How to use cryptocurrency

It is very easy for ordinary people to use this digital currency. Just follow the steps below:

  • You need a digital wallet (obviously, to store currency)
  • Use a wallet to create unique public addresses (this allows you to receive currency)
  • Use public addresses to transfer funds to or from your wallet

Cryptocurrency wallets

A cryptocurrency wallet is nothing but a software program, which can store both private and public keys. In addition, it can communicate with various blockchains, so that users can send and receive digital currency and track their balance.

The way digital wallets work

Unlike conventional wallets that we carry in our pockets, digital wallets do not store money. In fact, the blockchain concept is so cleverly mixed with cryptocurrencies that currencies are never stored in a particular location. Nor do they exist anywhere in cash or in physical form. Only records of your transactions are stored in the blockchain and nothing more.

A real life example

Suppose a friend sends you some digital currency, say in the form of bitcoin. What this friend is doing is transferring ownership of the coins to your wallet address. Now, when you want to use that money, you unlock the fund.

To unlock the fund, you need to pair the private key in your wallet with the public address to which the coins were assigned. Only when these private and public addresses match will your account be credited and your wallet balance increase. At the same time, the state of the sender of digital currency will decrease. In digital currency transactions, the actual exchange of physical coins never takes place in any case.

Understanding cryptocurrency addresses

By nature, it is a public address with a unique string of characters. This allows the user or owner of a digital wallet to receive cryptocurrency from others. Each public address that is generated has a corresponding private address. This automatic match proves or establishes ownership of the public address. As a more practical analogy, you can consider a public cryptocurrency address as your email address to which others can send email. Emails are the currency that people send you.

Understanding the latest version of the technology, in the form of cryptocurrency, is not difficult. One needs to take a little interest and spend time online to clarify the basics.

Visa says you can buy almost anything except cryptocurrency

The news this week is that several banks in the US and the UK have banned the use of credit cards to buy cryptocurrencies (CC). These reasons are impossible to believe – such as attempts to combat money laundering, gambling and protect small investors from excessive risk. Interestingly, banks will allow debit card purchases, making it clear that the only hedged risks are their own.

With a credit card you can gamble in a casino, buy guns, drugs, alcohol, pornography, anything and everything you want, but some banks and credit card companies want to ban you from using their facilities to buy cryptocurrencies? There must be some compelling reasons, and they are NOT the reasons given.

One thing banks fear is how difficult it would be to take away CC property when a credit card holder fails to make a payment. That would be much harder than owning a house or a car again. The private keys of the crypto wallet can be placed on a memory stick or a piece of paper and easily removed from the ground, with little or no trace of where they are located. Some crypto wallets may have a high value, and credit card debt may never be repaid, leading to a declaration of bankruptcy and a significant loss to the bank. The wallet still contains cryptocurrency, and the owner can later access private keys and use local CC exchange in a foreign country to convert and store money. A really rude scenario.

We certainly do not advocate such illegal behavior, but banks are aware of the possibilities and some of them want to extinguish it. This cannot happen with debit cards because banks are never out of pocket – money comes from your account immediately, and only if there is enough money on it to start. We try to find any honesty in the bank’s story about reducing gambling and taking risks. It is interesting that Canadian banks do not jump on this collection, perhaps realizing that the stated reasons for that are false. The consequence of these actions is that investors and consumers are now aware that credit card companies and banks really have the ability to limit what you can buy with their credit card. They do not advertise their cards in this way and this is probably a surprise for most users, who are already used to deciding what to buy, especially on the CC stock exchange and all other merchants who have concluded trade agreements with these banks. Stock markets have done nothing wrong – neither have you – but fear and greed in the banking industry are causing strange things to happen. This further illustrates the extent to which the banking industry feels threatened by cryptocurrencies.

At the moment, there is little cooperation, trust or understanding between the world of fiat money and the world of CC. The CC world does not have a central control body in which regulations can be fully applied, and that is why every country around the world is trying to figure out what to do. China has decided to ban the CC, Singapore and Japan are accepting them, and many other countries are still scratching their heads. What they have in common is that they want to collect income tax on CC investments. This is not too similar to the early days of digital music, with the Internet allowing unhindered distribution and distribution of unlicensed music. Digital music licensing schemes were eventually developed and accepted because listeners were fine with paying little for their music instead of endless piracy, and the music industry (artists, producers, record labels) was OK with reasonable licensing fees, not nothing. Can there be a compromise in the future of fiat and digital currencies? As people around the world become increasingly saturated with unprecedented banking profits and the overwork of banks in their lives, there is hope that consumers will be treated with respect and will not forever be burdened with high costs and unjustified restrictions.

Cryptocurrencies and blockchain technology are increasing the pressure around the world to reach a reasonable compromise – – this is changing the game.

Stay tuned!