Crypto Basics: A Beginner’s Guide to Digital Currencies — Part 3 | by Freia Skogstad | Coinmonks | Feb, 2024

Welcome back to ‘Crypto Basics’! In previous chapters, we likened blockchain technology to an Excel-like ledger and described blockchains as cities. Now, let’s explore public addresses, private keys, seed phrases, and wallets, which are essential components of crypto transactions.

Crypto wallets don’t store your digital assets; instead, they function as your interface with the blockchain. They manage your private keys, allowing you to send, receive, and check your balance. Think of them as online banking apps, offering access to your financial assets.

Public addresses in cryptocurrency work like bank account numbers. You share them to receive cryptocurrencies, and they are visible on the blockchain ledger for each transaction.

Accessing your wallet for everyday activities, like transferring funds or checking your balance, is akin to using a PIN code for regular bank account access. This PIN is your first line of defense, securing your wallet from unauthorized access.

Private keys in crypto are similar to keys to a safety deposit box. They are unique, secret codes that unlock access to your crypto assets. Your wallet software uses these keys behind the scenes to sign and authorize transactions.

A seed phrase, comparable to a PUK code for a bank account, is a backup method to restore access to your wallet. Keeping your seed phrase secure is crucial, as it can be used to recover your wallet and funds if you lose access. When writing down your seed phrase, ensure privacy, manually record it, and…