Cryptocurrency was created to provide decentralization and give control of finances to the owners, instead of involving a third party like the government. But nowadays we have some people who claim that we can trust them with our assets as long as they have access to it. These people are the centralized exchanges, but the only advantage is, they are convenient to use. But this is different with decentralized wallets.
Decentralized wallets are wallets that has no third party control. This means that with decentralized wallets it’s between you and your assets, you have to be responsible for the security of your assets. This is where private keys come to play. When opening a decentralized wallet you get private keys, this private keys could come as seed phrases or a long gibberish word. Depending on which wallet you are using, if you are reading this, I assume you already have a hive account, you got some gibberish words that make it really difficult to memorize or guess. That is your private keys and because Hive is a decentralized platform, you are soley responsible for the safety of your wallet. But if you have Trustwallet or a MetaMask, you will notice that it’s private key is different, this is called a seed phrase. Also hard to guess because it’s a bunch of words that you have to input in their order to access the wallet.
Your private keys gives you access and control to your account. I guess that’s why it was called a private key because just like the key to your house, it gives you access to your home. It’s always advisable to keep your private keys private because just like your home key, if you let anyone have it they will have access to your home. When someone has access to your home, they can take what they like. Same with crypto private keys, they can steal your funds. So your private keys are meant to be secret and securing them is your duty and no one else’s.
Not your keys not your crypto
Decentralized Wallets come in two ways, we have the hot wallet and cold wallet. The both of them use private keys, but hot Wallets are connected to the internet while cold wallets are not connected to the internet. Hot wallets are hackable because they are connected to the internet but cold storage are unhackable, you can’t hack what you can’t access.
Some people inscribe their keys on a metal and keep the metal hidden and safe. While some people leave theirs on a paper, but anything can happen to that paper, it can get soaked in water, get burnt or get turn.
Some prefer to store it in their email, but this is very risky. If your email gets hacked, your private keys will be exposed. But you can bypass that, by arranging the keys in a way or pattern that only you can decrypt, no matter how many people get hold of the phrase they won’t be able to decrypt because, you have encrypted the pattern.
On centralized wallets and exchanges, you can forget your password and request a new password. Few seconds later your password get reset and you have access to your account. But on decentralized wallets there is no reset or forgotten password button, you lose your keys and you have lost your coins for ever. You can’t change password or change private keys.
