Crypto Wallets - How to Safely Store Your Assets
What is a Crypto Wallet
A cryptocurrency wallet is a tool for storing and sending cryptocurrency. Coins aren't actually stored inside the wallet—instead, the wallet manages the Private Key that provides access to assets on the blockchain.
Simply put, a wallet is not a bank account but rather the key to a safe.
Core Concepts
Public and Private Keys
- Public Key: The address you share with others. Similar to a bank account number.
- Private Key: The secret key that can move assets. Never share this with anyone.
Seed Phrase (Recovery Phrase)
A combination of 12-24 English words provided when creating a wallet. It serves as a backup that can restore your private key.
If you lose your seed phrase, you will permanently lose your assets. Write it on paper and store it in a secure location.
Types of Wallets
Crypto wallets are broadly divided into two categories based on internet connectivity.
Hot Wallets
Wallets connected to the internet. Convenient but have relatively higher hacking risk.
| Type | Description | Examples | Best For |
|---|---|---|---|
| Exchange Wallet | Managed by exchange | Binance, Coinbase | Active trading |
| Software Wallet | App/Extension | MetaMask, Trust Wallet | DeFi, NFTs |
| Web Wallet | Browser-based | MetaMask (web) | Easy access |
Cold Wallets
Wallets not connected to the internet. High security but somewhat less convenient.
| Type | Description | Examples | Best For |
|---|---|---|---|
| Hardware Wallet | Dedicated device | Ledger, Trezor | Long-term storage |
| Paper Wallet | Keys printed | - | Extreme security |
Exchange Wallet vs Personal Wallet
| Aspect | Exchange Wallet | Personal Wallet |
|---|---|---|
| Private Key Control | Exchange | You |
| Convenience | High | Moderate |
| Security | Depends on exchange | Your responsibility |
| DeFi Access | Not possible | Possible |
| If Hacked | Exchange may compensate | Cannot recover |
"Not your keys, not your coins" — A saying meaning that if you don't control your own private keys, you don't truly own your coins.
Major Wallet Introductions
MetaMask
The most widely used software wallet for Ethereum and EVM-compatible chains.
- Browser extension + mobile app
- Essential for accessing DeFi, NFTs, and dApps
- Multi-chain support (Ethereum, Polygon, BNB, etc.)
Ledger
The most representative hardware wallet.
- Physical device connecting via USB/Bluetooth
- Private keys never leave the device
- Supports 5,000+ cryptocurrencies
- Can connect with MetaMask
Trust Wallet
Mobile wallet supported by Binance.
- Intuitive mobile interface
- Multi-chain support
- Built-in dApp browser
- Built-in staking features
Wallet Selection Guide
Beginners
Start with an exchange wallet, then add a software wallet like MetaMask as you become more familiar.
Active Traders
Use an exchange wallet as your main, but separate long-term holdings into a personal wallet.
Long-term Investors
Recommend storing assets offline in a hardware wallet (Ledger, Trezor).
DeFi Users
MetaMask + hardware wallet connection is the safest combination.
Wallet Security Guidelines
- Store seed phrase offline: Never save as a photo or in the cloud
- Beware of phishing: Always enter official website URLs directly
- Test with small amounts: Send a small amount before transferring large sums
- Separate wallets: Use different wallets for different purposes
- Regular checks: Periodically review and revoke approved contracts
You've completed the basic concepts. In the next category, Investment Basics, learn about using exchanges and trading strategies.