What are digital currency wallets?

Digital currency is money that is stored and exchanged exclusively via computers and digital devices. Due to its inherent digital form, digital currency wallets or apps are often popular methods for storage.

Digital currency wallets come in different forms and with various uses. It's important to understand how these wallets work, especially if considering buying, storing, and exchanging digital currencies. Learn more about what digital currency wallets are and how they can be used.

How do digital currency wallet apps work?

Digital currency wallets are applications or platforms that people can use to securely hold their digital currencies and make purchases with them. Some digital currency wallets, such as exchange wallets, can also be used to buy, sell, and transfer digital currencies.

Unlike many other types of wallets, these wallets don't necessarily store a person's digital currency. Instead, they store private keys — or encrypted, alphanumeric codes — that people can use to access and manage their currency. Whoever has the private key can use the corresponding digital currency, so it's important to keep that key safe with a digital wallet. It’s equally important to back up these keys, as losing them could lead to irretrievable loss of the digital currency.

What can digital currency apps be used for?

Digital currency apps have many potential uses, including:

• Securely storing digital currencies (or rather, private keys) like cryptocurrencies
• Managing currencies on one platform
• Making online and in-store payments
• Sending and receiving digital currencies from across the globe
• Transferring, buying, and selling digital currencies

Apps to buy digital currency

Certain wallet apps can be used to buy digital currency. Beyond offering storage and management tools, these apps can allow individuals to purchase, sell, and transfer currency.

A cryptocurrency exchange, for example, is a platform through which people can exchange their traditional currency for cryptocurrency. Some exchanges may also support exchanging one cryptocurrency for another.

Learning about digital currency in-app

Some apps may provide resources and insights to help people learn about digital currencies and make more informed decisions. Managing, buying, and selling digital currencies can potentially be confusing, so it may be helpful to find a digital wallet that offers articles and how-to tips right in the app. Additionally, digital currencies like cryptocurrency can have volatile value, so having an understanding of how it all works is highly important.