If you’re having difficulty in understanding the difference between Bitcoin wallet and Bitcoin wallet address keep reading on to clarify your doubts.
Before we dive straight into the address bit, you need to understand what exactly a Bitcoin wallet is.
A bitcoin “wallet” is basically a vault for your bitcoins. It contains all the information on your transaction history and balance. It allows you to store, send and receive bitcoins.
There are two main types of wallets:
Software wallet- It’s to be installed on your desktop or mobile. This wallet will be completely under your control and it is your choice what kind of software wallet you’d like to install.
Web wallet- It is hosted by a third party and is usually quite user-friendly, but it is your call to trust the provider to maintain high levels of security to protect your bitcoins.
What is a bitcoin wallet address?
It is simply a unique 26-35-digit combination of letters and numbers and it looks something like this, 1ExAmpLe0FaBiTco1NADr3sSV5tsGaMF6hd
Addresses can be generated at random and free of cost by any Bitcoin user. You will use this address to receive and send bitcoins from your wallet. You are able to send bitcoins to someone, by sending it to their bitcoin address. However, for each payment request or invoice, a new bitcoin address is generated.
Your Bitcoin wallet address can also be represented as a QR code. If somebody wishes to send your Bitcoin, they can scan the code using their Bitcoin wallet and send Bitcoin to your wallet:
Bitcoin addresses are created as part of a key generation process that creates a pair of keys. They are a matched set, where one is public and the other is private. When you “sign” a bitcoin address you are running the public and private keys through an algorithm that checks whether those keys belong together. Usually signing is talked about in the context of a message. Someone sends you a signed message and you can verify that the message came from the genuine person. You can verify the message because it was signed with their private key and you match it to their public key.
When sending bitcoins, the signed message is a portion of the bitcoin transaction and you do not explicitly see the message, it is just part of the transaction. This lets you validate the ownership of the address. The transaction was signed with the owner’s private key and you check that it’s valid using their public key. Bitcoin wallets usually contain this message signing and verification functionality.
Make sure you and only you control the private keys to your bitcoins!