Wallet
A crypto wallet is an app or device that stores the keys to your coins and signs transactions. The coins themselves live on the blockchain, not in the wallet.
How it works
A wallet has an address (you can share it so people can send you coins) and a private key (it gives the right to spend the coins and is shown to no one). Usually all keys can be restored from a seed phrase: 12 or 24 words the wallet shows you when you create it.
Wallets can be hot (a phone app or browser extension connected to the internet) or cold (a hardware device the keys never leave). Hot wallets are handier for frequent use; cold wallets are safer for large amounts.
If you keep coins on an exchange, the exchange holds the keys and you only have a balance record. In your own wallet you hold the keys, and all the responsibility too: lose the seed phrase and nobody can restore access.
You deleted the wallet app and your phone broke. The coins are not gone: you enter your 12-word seed phrase into a new app and the balance shows up again, because it is stored on the blockchain.
You want to send 100 USDT from your wallet on the Ethereum network. For that the wallet also needs a little ETH: the network fee (gas) is paid in the network's native coin, not in USDT.
The most dangerous mistake is storing the seed phrase in notes, the cloud or a screenshot, or typing it into a website "to verify" or "sync" your wallet. Anyone who knows the phrase can take all your coins, and it cannot be undone. Write it on paper offline, never share it, and use a separate wallet with a small balance for connecting to websites.
Questions and answers
What is a crypto wallet in simple terms?
It is like a keyring for your coins. The coins are recorded on the blockchain, and the wallet holds the key you use to approve sending them.
Can I recover my wallet if I lose my phone?
Yes, if you have the seed phrase: enter it into any compatible wallet. Without the seed phrase or private key, access cannot be recovered.
What is the difference between a wallet and an exchange account?
On an exchange, the exchange holds the keys and can freeze withdrawals. In your own wallet only you hold the keys, so nobody can block your coins, but nobody can fix your mistakes either.
Related terms
Read next
Your seed phrase gives full access to a wallet. Where to keep it and what never to do.
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Read →Wallet addressA wallet address is a string of characters people send crypto to, like an account number. It is safe to share, but…
Updated: 2026-10-19