What is a bitcoin wallet?
First of all, a bitcoin wallet is a safe place to store your cryptocurrency. Because like real money, jewelry or gold, digital currencies need a safe – a digital wallet – to be protected against theft. But not only that, because beyond its custody function, a wallet is also required for trading. Both sending and receiving a cryptocurrency is processed here. So if you want to buy and pay for something online with your bitcoins, you do it through your wallet. The same goes for converting digital currency into real, physical money. There are different types of wallets, which we will go into more detail in our Bitcoin wallet comparison.
However, there is an important difference to normal wallets: the wallet does not contain the actual bitcoins, but the so-called public keys and private keys. These are the cryptic keys needed to access the coins. The coins continue to exist only in the blockchain with which the wallet interacts. While the public key can be sent to anyone wishing to deposit bitcoin into the appropriate wallet, the private key must not be shared with any third party. Because with it, the coins can be withdrawn and spent.