How does an encrypted wallet work? What are the most common encrypted wallets? Speaking of the encrypted wallet, everyone is very curious about it. In fact, the encrypted wallet is a place to store encrypted assets. The encrypted wallet does not directly store digital assets, but provides the information needed for interaction with the blockchain. When registering an encrypted wallet, the wallet will generate some necessary information to prove the relationship between you and the address. So how does the crypto wallet work? Now let's have a look.
How does an encrypted wallet work?
The encrypted wallet stores the private key and public key that interact with Bitcoin SV network. Generate alphanumeric identifiers based on public and private keys. This identifier is often referred to as an "address" because it refers to a specific location on the blockchain. This address is the address Bitcoin provided by each party for transaction.
The stored private key must have ownership of the public address. To complete a bitcoin transaction, the public key and private key must match. The transaction is signed by the sender and recorded on the Bitcoin (SV) blockchain. Once this happens, the receiver's balance will increase and the sender's balance will decrease accordingly. The private key must not be divulged, otherwise the party concerned will be at risk of bitcoin theft.
What are the most common encrypted wallets?
Most encryption wallets are based on software and have many forms, such as desktop, mobile, network, etc. Software based wallets are more convenient and comfortable to trade because, in general, they are connected to the Internet.
The online wallet, just like the cryptocurrency exchange, allows you to access the blockchain through the browser interface without downloading and installing software. Users can create a new wallet and set a personal password to access it. The disadvantage is that some service providers hold and manage private keys on behalf of users. In fact, the information stored on the central server is easy to be attacked by hackers.
Desktop Wallet is downloaded and operated locally on the user's computer. Desktop Wallet gives users complete control over their keys and funds. Although desktop wallets are considered more secure than Internet wallets, users are still vulnerable to theft if their computers are equipped with any viruses or malicious software. Therefore, back up the wallet It is vital that the dat file is kept in a safe place. If the hard disk is damaged and there is no backup, the coin will be lost.
Compared with other available options, mobile wallet is relatively convenient and comfortable to use. With mobile wallet, users can immediately use QR scanning to check their account transactions or make in store payments. These features make mobile wallets best suited for daily transactions. Similar to desktop wallets, mobile devices are vulnerable to malware infection and malicious applications. Users are encouraged to keep their private backup key (or seed phrase) to prevent the smartphone from being lost or damaged.
In general, the encrypted wallet is used to protect the private key and address. The encrypted wallet stores the private key and public key that interact with Bitcoin SV network. The stored private key must have the ownership of the public address. Common encrypted wallets include network wallets, desktop wallets, mobile wallets, mobile wallets, etc. Desktop wallet is downloaded and operated locally on users' computers. Desktop wallet allows users to fully control their keys and funds. Although the mobile wallet is relatively convenient and comfortable to use, it is most suitable for daily transactions.