A cryptocurrency wallet keeps crypto safe and accessible and allows you to send, receive, and spend them, as Bitcoin and LYO Credit. They are the main tool for cryptocurrency users since it allows them to store and retrieve their digital assets. Each coin corresponds to its own wallet: this means that there is one wallet only for Bitcoin, and for Ethereum and so on. A wallet has a deposit address consisting of a series of digits and numbers. It is the only information needed to make a transaction. Unlike bank transactions where the recipient's name, residence and IBAN are required, the wallet address is enough to make a crypto transaction.
The activities of a wallet are visible on the blockchain. Searching for the address on a blockchain, it's possible to view the incoming and outgoing transactions, timing and amount. There is no personal information of the owner. In this way, the flow economy of a coin is transparent and visible to all, but the user's privacy is respected.
These wallets can be online or physical (offline):
- Online wallets are accessed on exchanges and applications, such as LYOTRADE exchange and LYOPAY application. By logging into the account, users access their funds and can transact to other wallets (on the platform itself or on external platforms). There are wallets as software, which can be installed on a computer or as browser extensions: in these cases, a password called Secret Recovery Phrase consisting of 12 words is provided, and allows re-entry to the wallet in case of password or device loss.
- Physical wallets come in various forms and are called cold wallets (also known as a hardware wallet or cold storage). A cold wallet is a physical device that keeps cryptocurrency completely offline. Many look like USB drives, others such as the LYOPAY Cool Wallet S, is of the size of a card to connect via Bluetooth to a smartphone. Taking funds offline helps protect from hacking and online attacks.
The blockchain fee is a cryptocurrency transaction fee that is charged to users when performing crypto transactions. The fee is collected in order to process the transaction on the network. This is needed since it works as a reward for the exchange that allows the services, and for the validators that check and process the transactions.
If during the network congestion the applied fee is too low or even 0, there will be fewer chances that the transaction is processed. The transaction will be displayed as Canceled and the funds instantly re-appear in the sender's wallet.