Crypto Wallet: What is It For, How Does it Work, and Why You Need It

No matter how little you’re familiar with the crypto industry, you’ve probably heard about the recent ups and downs in the price of Bitcoin. Although the cryptocurrency went through a 7-year low during the first week of the Coronavirus outbreak, it quickly bounced back and now it’s worth even more than it did before the virus spread all over the world.

Have you ever wondered how people buy and store these Internet coins? Did you even know that you can use a wallet to store all of your virtual coins just like you would real-world currency? Today, we’re going to see what a Bitcoin wallet is, how does it work, and you really need to use one if you want to dive deep into the world of crypto.

Without further ado, let’s start…

What is a Crypto Wallet For?

You’ve probably heard about crypto wallets if you’ve been following the crypto industry for some time. Two years ago, there were around 24 million crypto wallets on the market. Nowadays, that number is significantly higher. According to the latest reports, there are around 40 million wallet users.

What is a crypto wallet? It’s exactly what it says it is: it’s an online wallet that allows you to keep your coins in a safe place and use them whenever you want to.

There are a few different types of wallets, which give you a number of ways to store your crypto investments. While there are numerous types of wallets and wallet-type applications, generally, we can break down crypto wallets into three different categories:

1. Desktop Crypto Wallets

A desktop wallet needs to be downloaded and installed on your PC before it can be used. Once you install it on a device, you can only access it from that device. That means, there’s no way to access it remotely. The upside of desktop wallets is that they offer the highest level of protection and you can only lose your coins if someone directly hacks your device or steals it.

2. Mobile Crypto Wallets

Mobile wallets, on the other hand, are essentially a type of mobile application. Most of them have a rather limited amount of space, which means, you can’t really carry around a lot of coins on you. But mobile wallets have benefits of their own. For example, they are extremely user-friendly, so even an elderly person can use them. Also, you can use them anywhere, even while you’re shopping.

3. Online Crypto Wallets

These wallets work on the cloud and you access them from any device you have, as long as you have an Internet connection and right login credentials. Although this is the most popular kind of crypto wallet, they are controlled by 3rd-parties, which means you have the least control over them and their security.

How Does a Crypto Wallet Work?

Bitcoin and other cryptocurrencies don’t exist in physical form. After all, they are cyber currencies. That means, wallets don’t exist in the physical form – although you can access some wallets through USB sticks and printed pieces of paper – they are, in fact, pieces of software. Just like every Bitcoin has its unique ID, every Bitcoin wallet has its unique address.

Every wallet address is unique just like your bank account. The wallet uses a combination of letters and numbers for its address. While you can look up transactions made through a wallet address, you still can’t identify the owner of the wallet. Every Bitcoin wallet comes with a unique key as well, which allows the owner to have access to it.

Like anything else, these wallets have their vulnerabilities and it’s up to the user to follow the best security practices. At the moment, there are more than 150,000 Bitcoin wallets infected with malware. Of course, a vast majority of these wallets come from the Asia Pacific region where Bitcoin is more openly accepted, still, the numbers indicate that you need to pay attention to security at all times.

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Why Do You Need a Crypto Wallet?

Do you need your crypto wallet for anything more than keeping your Bitcoins all together in one place? Well, you actually do. You need your wallet to keep your investment safe from all of the scams that occur on the Internet. As of this writing, there were more than 25,000 scams reported in the United States, and victims lost over $21,7 million dollars. 

You need to find a secure crypto wallet if you don’t want to fall victim to one of these scams. With so many wallets on the market, how do you even make a choice?

Needless to say, if you’re going to use a crypto-wallet you need to make sure that the company you’re dealing with is legit. This is the natural first step anyone should take when using a new product. When it comes to cryptocurrencies is extremely important, because on average, cybercriminals steal around $9 million from crypto-users every day. That’s almost $3.3 billion on a yearly level. 

You should only deal with companies like NordikCoin that are fully-transparent and 100% secure. The company was established by a group of legal and crypto professionals that aim to provide the following benefits.

1. High-Level Security

In order to ensure the safety of their customers, they employ the latest encryptions and safety systems. Furthermore, the company requires a series of registrations with numerous ID solutions for all clients.

2. Satisfied Customers

Since the company was launched, 100% of their customers have continued using their services to store and purchase Bitcoin. That’s because the company provides a secure way of storing and buying Bitcoin.

3. Ease-of-Use

Their interface is extremely easy to use. No matter how much experience you do or don’t have with buying and storing Bitcoin, you’ll be able to set up an account and use it in a matter of minutes.

Final Thoughts on Crypto Wallets

With that, we’re done. We showed you what crypto wallets are, how to use them, and why you need them. As we mentioned, if you want to become a Bitcoin user, you need to get yourself a good, secure wallet to keep your investment away from the hands of cybercriminals.

We hope that you enjoyed our article and that you found it helpful. What’s your experience with crypto wallets? Have you used one before? Share your experience with us in the comment section below.

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