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    Home » How To Store Ethereum: A Guide To Ethereum Wallets
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    How To Store Ethereum: A Guide To Ethereum Wallets

    adminBy adminNovember 27, 2018Updated:July 13, 2022No Comments4 Mins Read
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    How To Store Ethereum: A Guide To Ethereum Wallets

    You will need a cryptocurrency wallet to hold your Ether tokens. The concept is no different from how you store Bitcoins (Read: “How To Store Bitcoin”). There are some different wallets you can store your Ether tokens in. These include:

    • Online wallet
    • Mobile wallets
    • Desktop wallets
    • Hardware wallets
    • Paper wallets

    How do Ethereum wallets work?

    Your Ether wallet is nothing like a real wallet. Instead of containing the actual Ether tokens, your wallet stores your private keys. The private keys can be used to access your Ether tokens, which are recorded on the Ethereum blockchain. If you lose your wallet containing your private keys, then you lose all access to your Ether tokens. For this reason, it’s essential that you take every possible measure to protect your Ethereum wallet. 

    How do receive Ether tokens to your wallet, then? In addition to holding the private key to access your Ether tokens on the blockchain, your wallet also has a public key. This key can be accessed by anyone and is the address people can use to send you money. The public key allows anyone to see your balance and transaction history. It’s not possible to view any of your personal information, nor is it possible to withdraw money from a wallet with a public key.

    Private wallets and third-party wallets

    As mentioned, there are many ways to acquire an Ethereum wallet. All cryptocurrency exchanges will provide you with an online wallet when you create an account. Similarly, all Ethereum debit cards will have an online wallet attached to them. These wallets are third-party wallets, which means that they are tied to the exchange or debit card website. If the site goes down, so does your wallet. For this reason, it’s good practice not to store all your Ether in a third-party wallet. 

    Private wallets come in many forms, including mobile, desktop, hardware, and paper wallets. What they all have in common is that they are yours, and yours only. Below we’ll go through how each wallet works.

     

    Mobile wallets

    If you go to the App Store on iOS or Google Play on Android, you’ll be able to find some Ethereum wallet apps. These apps can be installed like any other and turn your phone into an Ethereum wallet. Some mobile wallets can synchronize with other devices — but not all wallet apps can do that. If you lose your phone and your mobile wallet isn’t synced to other devices, then your Ether tokens are gone.

    Desktop wallets

    Similar to mobile wallets, desktop wallets are apps you install on your desktop computer. Again, if your computer breaks down and you can’t recover your files, you risk losing your Ether tokens.

    Hardware wallets

    Hardware wallets can be a good investment because of the risks associated with third-party, mobile, and desktop wallets. These wallets are hardware devices that contain your private keys, much like a USB flash drive contains your files. Hardware wallets also have the added benefit of being able to take your private keys off-line so they can’t be hacked.

    Paper wallets

    The most basic kind of Ethereum wallet is a paper wallet. It’s called a paper wallet, but can be any inanimate object your scribble your private key onto. A paper wallet will not only take your private key offline but eliminate the risk of technical difficulties. The danger with paper wallets, however, is that they can get lost or be stolen.

    What is a full node wallet?

    Full node wallets are usually desktop wallets that contains all the data from the entire Ethereum Blockchain. This means you’ll need to download many GB of data (and counting) to your desktop to use it. Once installed, your computer becomes one of many nodes used to verify transactions on the Ethereum blockchain. If you don’t download a full node wallet, then your wallet needs to connect to another node that does have the entire blockchain.

    Hot vs. cold wallets

    The terms “hot” and “cold” simply refers to “online” and “offline” wallets. Hot/online wallets are practical because they’re so accessible. The downside is that they’re also more susceptible to hacking. Cold wallets are much less efficient but much more secure.

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