Important Types Of Cryptocurrency Wallet You Should Know #005

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It is another beautiful day of the week and I trust you are doing perfectly well.

As usual, as a determined soul, I have taken it upon myself to always be active in this community.

I believe you are all promoting steemit on social media as it should be, as this will help to increase the steem economy.

Today being another beautiful day, we shall be discussing on the different types of wallet we have available and knowing it's function will enable us select the best to make use of.

Without any delay, shall we dive into the discuss for today:

• PASSWORD PROTECTED WALLET:

A password protected wallet as the name implies is a wallet whose content is protected by a password or phrase.

It is a wallet whose content can only be assessed through the use of a phrase. This is the security measured installed in the wallet to ensure the security of the sensitive information/funds stored in the wallet.

A password protected wallet can further be explained to be a software application used for the storage of private keys which are used to validate cryptocurrency transactions.

When a user intend to create a password protected wallet, he is required to set up a very strong password and this password has to be unique as it serves as the line of defense against unauthorized access.

When setting this type of wallet, it is very important to set a password that is not related to a person's profile so it cannot be easy guessed by anyone.

After the wallet has been set up, it will be impossible for the owner of such wallet to assess his funds without inputting it's correct password.

This implies that a user has to carefully input the correct password before he can access his funds.

• BIP 38 WALLET:

A bip 38 wallet which is an acronym for Bitcoin Improvement Proposal 38 wallet can be explained to be a type of encrypted paper wallet used for the security of bitcoin's and other cryptocurrencies private keys.

BIP38 was proposed in 2013 by a bitcoin developer with the name Mike Caldwell as method to protect unauthorized access to the paper wallet.

A paper wallet refers to a physical printout that contains the private keys and public keys that are linked to a cryptocurrency wallet.

The private keys is a long phrase or alphanumeric characters that is used to access and control the funds of a wallet.

It is only with the private keys that the funds of a wallet can be spent.

Bip 38 wallet helps to improve the security of a paper wallet through the encryption of the private keys with a passphrase.

The passphrase is usually a user define characters that is generated during the creation of wallet, and the passphrase is needed to access the private keys of the wallet and without it, the private keys will be in an unreadable format.

The encryption of the private keys helps in the addition of an extra layer of protection against un-authorized access. Even if the paper wallet gets into the wrong hands, it will still be unaccessible as the passphrase will be needed to access the funds in an account.

The paperwallet are usually derived and saved offline, thus making it easy for the wallet to be hacked by online scammers.