Cryptocurrency such as Bitcoin and Ethereum is one of the trending terms world-wide nowadays. People want to store and perform transaction with their digital currency whether its Bitcoin or any other crypto coins and ICO tokens. But without crypto wallets it’s not conceivable. Have you ever wondered how to start own Cryptocurrency Wallet Development? Here is the comprehensive guide regarding Cryptocurrency, CryptoWallet & its types and how it works.

Report shows Total Transaction Value in the “FinTech” market amounts to US$1,280,404m in 2018.

Report shows, In the “FinTech” market the number of potential users is expected to amount to 291.3m by 2022.

What Is Cryptocurrency Wallet?

Simple Definition: It’s just a software that stores your crypto currencies like your real-life leather wallet.
Techy Definition: It’s a software that stores your private and public key which aids you to perform a transaction by sending and receiving multiple cryptocurrencies via blockchain technology.

How Does a Cryptocurrency Wallet Work?

There are plenty of users utilizing crypto wallets, but they might not aware how it works. Crypto wallets are completely digital, and currencies don’t get stored physically anywhere. There is an existence of transactions’ records on the blockchain. It stores private keys (like your bank account PIN number) and public keys (like your bank account number).

If you need to send a payment using crypto, you need their public address (unique identifier tied to their wallet). Now you need to enter their public address followed by the amount you want to send. You can send this type of payment to anyone, anywhere in the world with the access of internet. Just like your bank account number, a public address is a unique identifier tied to you. You can share this public address with any one and they can share cryptocurrency to you. Sounds simple right?

Banks are keeping the records of how much somebody earns and who makes payments to whom. Somehow, we need to keep track of everything that happens. This is where private key comes in. A private key is another long strength of letters, numbers and symbols together.

Like “H0qtjTkVxwTCpvKe4eCZ0FPqri0cb2JZfXJ/DgYSF6vUp”.

This private key is peered to a public address and used to authorize a transaction. Once a transaction has recognized, having a matching public address in private key, it is authorized by the network and send to recipient’s public address. By enabling you to send, receive and store cryptocurrencies, a wallet is designed to keep your private key hidden from other users, so they can not access your fund.

5 Types of Cryptocurrency Wallets

There are several types of wallet development for the cryptocurrency. Each of them comprises a different level of safety features. Online Wallet, Mobile Wallet, Desktop Wallet, Hardware Wallet and Paper Wallet. Lets deep dive on each one separately.

1. What is an Online/Web Wallet?
   These are the types of wallets you can utilize through your web browsers. Online wallets are ideal to store a small amount of crypto coins. It makes use of TOR network that allows users to boost their security online by enabling anonymous communication.
   Web wallets are open to vulnerabilities and viruses. Your wallet would be out of your hand and info is stored on a third-party.

2. What is a Mobile Wallet?
   Wherever you are, you can access your cryptocurrencies from your mobile device. Wallet runs on an application that resides in your mobile phone. It’s quite small and easy-to-understand compare to desktop ones as there is a limitation of space. Its best feature is QR code scanning. It also uses TOR network like Online Wallet.
   Mobile devices are not secure as it is open to hackers. If it got affected by malfunctions, you would lose your cryptocurrencies. Nothing will help you out.

3. What is a Desktop Wallet?
   If we compare desktop wallets with web and mobile wallets, desktop wallets steps ahead in the competition of security. You can access this wallet from only one computer in which it is downloaded. Private keys are not stored on a third-party server.
   If you forget to take back up and your desktop faces any crashes, you would lose your data. There are some desktop wallets that requires odd security certificates.

4. What is a Hardware Wallet?
   Hardware Wallets are physical devices like USB that store your cryptocurrency. It comprises great security because they are stored offline even though transactions take place online. Users need to just plug-in their device to any computer which is connected to the internet; add a pin, send coins and then confirm. You are all done. It is the best wallet to store your large amount of records for long-term.

5. What is a Paper Wallet?
   It’s a physical printout of your public and private keys. Before the introduction of hardware wallet, paper wallets were used for cold storage of cryptocurrencies. If you want to transfer crypto coins to your paper wallet, you need to transfer fund from your software wallet to public address entered on your paper wallet. Same way if you want to withdraw coins, transfer fund from your paper wallet to software wallet. This can be done manually entering your private keys or by scanning QR code on the paper wallet.
   You need to deliver extra efforts to transfer cryptocurrencies as well as need an expert-level understanding of technicality.

How to Choose Best Crypto Wallet Developers?

Cryptocurrency wallet development from the skilled developers is necessary. The developers must have expertise in delivering best features and benefits when it comes to Cryptocurrency wallets. They are accomplished enough to aids in,

• End-to-end encryption
• Auto-Generation of new public key
• Two-factor authentication (Authorization)
• Protection of password (Privacy)
• QR Scanner
• Auto denial if the address has been used before (Duplication detection)
• Import/Export private key
• Support multiple cryptocurrencies
• Irreversible transactions
• Automatic session logout
• Access of frequent addresses