How to Create a Cryptocurrency eWallet App: Best Practices and Features

In this article, we dive into the world of cryptocurrency, explain how cryptocurrency wallets work and provide you with a step-by-step guide on how to develop one.

What is a cryptocurrency wallet?

A crypto wallet is a device, medium, or application that allows you to securely store and manage your cryptocurrencies in accordance with the best principles of the blockchain network, namely security, anonymity, and decentralization. Despite the fact that there are already several popular and secure solutions on the market, companies are often faced with the need to create an individual cryptocurrency wallet for users.?

How do crypto wallets work??

A blockchain is a public ledger where data is stored in what is known as “blocks”. This is a record of all transactions, balances stored at any given address, and information about who owns the key to these balances. Cryptocurrency is not stored “in” a wallet as such. The coins exist on the blockchain and the wallet software allows you to interact with the balances stored on that blockchain.?

The wallet itself stores the addresses and allows its owners to move coins to another location, as well as allowing others to see the balance stored at any given address. When sending a cryptocurrency transaction, always make sure you are sending it to a wallet address with the same cryptocurrency type. For example, if you send Bitcoin (BTC) to a Bitcoin Cash (BCH) address, those funds are lost forever.

Although every wallet is different, here are the general steps involved in sending or receiving funds with a crypto wallet:

• In order to receive funds, you need to obtain an address (also known as a public key) from your wallet. Find the “Generate Address” function in your wallet, click on it, then copy the alphanumeric address or QR code and share it with the person who wants to send you crypto.
• To send funds, you need a receiving wallet address. Find the “Send” feature in your wallet and enter the wallet address you are going to send coins. Select the amount of cryptocurrency you would like to send and click on “Confirm”. Consider sending a small test transaction before sending large amounts of crypto. Please note that sending coins requires a fee to be paid to miners in exchange for processing the transaction.

Why develop a cryptocurrency wallet

• Wallets are easy to install on multiple platforms and operating systems. It should fit well with the device you are using.
• Security measures are taken by securing the wallet with a PIN and a strong password. Hence, there is no chance for hackers or phishing attacks when a transaction is being processed between two parties.
• Cryptocurrency wallets are protected by state regulations and laws. Consequently, users’ funds cannot be frozen due to actions taken by any authorities. The system is fully decentralized and does not have a single point of failure.
• Funds can be transferred instantly and users don’t need to go through any kind of verification. Compared to other traditional methods such as bank transfers or wire transfers, the transaction fees are very low.
• It’s inflation-protected. Therefore, the value of user funds will not change under any circumstances, since there is no increase or decrease. This results in greater confidence and trust when making online payments.
• Users can have full access to their transaction history at any time and use it 24/7 to transfer funds to any user wallet address.

Types of cryptocurrency wallets

With?blockchain app development, you can develop any type of cryptocurrency wallet. Based on what users are planning to do with cryptocurrencies, there are various options for crypto wallets that you can launch in the market.

For example, many long-term crypto investors plan to hold a wallet for a long period of time. That is why they can choose a wallet with excellent security features. On the other hand, users who actively trade cryptocurrencies can count on convenience and speed. Depending on whether a wallet can be connected to the Internet or not, it is divided into cold and hot crypto wallets.

Cold Wallet

These are also called hardware wallets. They store your keys offline on a device that is not connected to the Internet. Many popular cold storage wallets look like USB sticks. Sometimes paper wallets – with your public and private keys printed on a piece of paper – are also used as cold storage.

Many crypto proponents see cold storage as the best option for protecting your digital assets. Because they are not connected to the network, these wallets are considered the most difficult to hack. But they can be easily lost or misplaced.

Hot Wallet

If you want to learn more about cryptocurrency wallets and how to build one, please read our full article at Mobindustry.net