To use cryptocurrencies, you'll need a wallet to store them in and transact with the blockchain. In our algorithm track, we will go through the algorithms for interacting with cryptocurrencies, but most of the time you want to just be able to spend and receive coins in an easy-to-use manner. This is where wallets come in.
Wallets are programs that contain information on using and transacting for different cryptocurrencies. Some wallets support more than one crypto, while others are specific to just one coin. Additionally, some crypto will be supported by multiple wallets, while others will be supported only on a single wallet.
Further, there are many types of wallets:
- Software wallets, that you run on your computer
- Mobile wallets, like software wallets but are run on your mobile device
- Hardware wallets, with USB-like sticks that store your coins on them
- Paper wallets, that print out the relevant information onto a piece of paper
- Online wallets, cloud-based software wallets
There are additional options, but that's the standard list most people would use.
Going through the above list, you might be unsure about what it means for a wallet to "store" your coins. In essence, all the wallet really stores is your private key. With that key, however, the wallet is able to make transactions against "your" coins on the blockchain. Think of it like a key to a deposit box at a bank - the bank actually has your things in a box on-site, but you hold the key to get into that box. The blockchain stores your coins, but you hold the key to actually use them.
As an example, when you use a paper wallet, you are really just printing out your private key. We will cover paper wallets in a later lesson, including how to spend from a paper wallet.
We like the following wallets, although we should point out that this doesn't mean they do, or might, have issues.
- Coinomi, a mobile-wallet for Android (and iOS coming soon)
- Exodus, a software wallet for your computers desktop
- ARK wallet, a software wallet for your computers desktop specifically for ARK
- MyEtherWallet, a web browser based wallet for Ethereum
- Trezor, a hardware wallet that plugs into your pc via USB
When using a wallet, you need to be quite careful to follow the instructions on how to use and secure the wallet. If you lose your private key or password to the wallet, nobody, not even the wallet software's creators, can recover your password or your coins. Follow the instructions closely, and keep an eye out for a new lesson from us on best-practice security.