- What is bitcoin?
- Digital Wallets
- Wallet Address...
Today's lesson will be somewhat of a continuation of the previous. So, we will discuss more on Bitcoin wallet address and types and so on and so forth... Well, with all that being said, let's jump right in!
Bitcoin Wallet Address Requirements.
- Public keys and private keys are needed : I believe this was well explained in the last class. Well, I am still going to go further. When you get a wallet, you will get a set of public key; actually more than one so that you can give your public keys to as many different persons as you want to.
Warning: Don't show your private key to anyone but yourself.
A public address is needed: A public address is the public facing key that allows you to send or receive BTC (Bitcoin). Without this address, how would people know who to send to?
This public key allows the public to find you.
You need a private key to unlock your wallet and authorize outgoing transfers from your account (This is crudely compared to a pin code).
Don't share your private keys with anyone! Anyone who has access to your private key can use your cryptocurrency.
A wallet acts as a pairing station of a public BTC (Bitcoin) address with it's corresponding BTC (Bitcoin) private key (it's a platform).
Types Of Wallets
Hot Wallet: This is a mobile or desktop application. Examples are : (Mycelium, Blockchain and Electrum...)
Cold Storage: This is a hardware wallet or paper wallet. A cold wallet is not linked to the internet and this makes it safer but less flexible. Examples are: (Trezor, Ledger, Nano...)
Online Wallet (bank) : This is a combination of both the hard and the cold wallet. This is trusting a third party to manage your keys. An example is Coinbase.
Note: To be able to spend your coins and unlock the funds, the private key stored in your wallet must match the public address the currency is assigned to. If public and private keys match, the balance in your digital wallet will increase and the sender will decrease accordingly. There is no actual exchange of real coins.
The transaction is signified merely by a transaction record on the blockchain and a change in balance in your cryptocurrency wallet. A private key in the context of Bitcoin is a secret number that allows bitcoins to be spent. Every bitcoin wallet contains one or more private keys which are saved in the wallet file. The private keys are mathematically related to all bitcoin addresses generated for the wallet.
Thank you for reading...
A special thanks to all my followers...