What in the world is a crypto wallet?

If you’re into investing, there’s a good chance you’ve heard of bitcoin and other so-called cryptocurrencies. Investing in and safely storing bitcoins and other crypto coins can be intimidating, especially if you’re not tech-savvy. However, with the right crypto wallets, or bitcoin wallets as they are sometimes called, trading coins is easy and generally safe.

The total value of all cryptocurrencies has surged past $2 trillion, up from $200 billion in 2019. Bitcoin retailed for less than $10,000 per coin through most of 2019 but has surged past $50,000 in recent weeks, according to statista.com. Other coins, such as Ethereum and Binance Coin are gaining market share and value as well.

Cryptocurrencies are typically encrypted and use a mix of public keys to record and track transactions, and private keys to restrict control and access. Keys are simply a long string of letters, numbers, and symbols, sort of like a large, randomized password.

Public keys allow users to create addresses where money can be sent to. Private keys essentially act as the lock and control mechanism for a specific coin. Someone who has a private key can take control of the coin. The private key is a piece of data that proves you own the right to a specific bitcoin or another crypto coin.

A crypto wallet is typically a software solution that you can use to store both public and private keys. With the public key, people can send you cryptocurrencies, meaning they can pay you. And if you know someone else’s public key, you can pay them.

As for private keys, a wallet will help you keep private keys secure. You can set passwords and other authentication methods to restrict access to your wallet. So long as the private keys and your wallet’s login information remain hidden, your cryptocurrencies are typically safe.