In 30 seconds
- Your assets live on the blockchain; the wallet holds the key that lets you move them.
- The private key signs; the address receives. The address comes from the key, never the other way around.
- The recovery phrase (12 or 24 words) recreates your keys in any compatible wallet. Whoever has it has everything.
- There is no “forgot password”. That's why the phrase is stored offline and never shared.
A wallet doesn't hold coins
When you say “I have 0.1 ETH in my wallet”, technically the blockchain records that the address 0x4c2a…9f1b controls 0.1 ETH. The wallet is the app or device that holds that address's key and signs the orders to move it.
That's why, if you delete the app, your assets don't disappear: they stay on the blockchain. What you need to use them again is the key, or the phrase that generates it.
Your wallet is a keyring, not a purse: the value is on the chain; the keyring holds the access.
Private key, public key and address
| Piece | What it is | Can you share it? |
|---|---|---|
| Private key | A huge secret number. It's your signature: whoever knows it can move everything. | Never |
| Public key | Calculated from the private key. | Yes, though you'll rarely see it |
| Address | On Ethereum, the last 20 bytes of the Keccak-256 hash of the public key, with “0x” in front: 42 characters. | Yes: it's what you give to receive |
The calculation only goes one way: the address comes from the private key, but the key can't be obtained from the address. That's why sharing your address is safe, and sharing your key is handing over everything.
What signing means
Every action —sending, approving, voting, signing in— is a message your wallet signs with the private key. The signature proves the order comes from the owner of the address without revealing the key. The network checks the signature and, if it matches, executes.
Here's the human weak spot: signing is powerful. An “approval” signature can authorize a contract to move your tokens forever. Before signing, read what you're authorizing, and if it says approve or setApprovalForAll on a site you don't know, stop. More in crypto scams and how to avoid them.
The recovery phrase
Almost every wallet generates your keys from a phrase of 12 or 24 words, taken from a standard list of 2,048 words. With that phrase, any compatible wallet recreates all your keys and addresses. It's your backup and, at the same time, your biggest risk.
- Write it down by hand, in order. On paper or stamped in metal, with each word in its exact position.
- Keep it offline. No photos, phone notes, emails, screenshots or cloud.
- Keep two copies in different places. A fire or a move shouldn't leave you locked out.
- Never type it into a website. No company, tech support or legitimate “verification” will ever ask you for it.
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Kinds of wallet
| Type | Who holds the keys | Upside | Risk |
|---|---|---|---|
| Exchange (custodial) | The platform | Easy, no phrase to look after | You depend on the company: closures or freezes. See the Orionx case. |
| Browser or mobile (hot) | You | Convenient for everyday use | It's online: malware and fake sites |
| Hardware (cold) | You, on a device | The key never leaves the device | Lose the device and the phrase, and you lose everything |
| Multisig | Several keys at once | Nobody moves funds alone | More steps to operate |
| Smart contract wallet | A contract with rules | Spending limits, recovery through trusted people | Depends on the quality of the contract |
The last two change the idea of “one key, one owner”. A multisig requires, for example, two out of three signatures to move funds: it's what treasuries and communities use. And account abstraction (ERC-4337) enables wallets that are contracts, with their own rules and recovery methods that don't depend on a single phrase.
A sensible setup
- An everyday wallet with small amounts, to pay and use applications.
- A vault, ideally hardware, for what matters. It almost never connects to sites.
- An empty wallet to try new sites, claim things or connect to what you don't know.
Splitting things up works like keeping a debit card in your pocket and your savings in another account: if something goes wrong, the damage stays contained.
Does one wallet work across networks?
On Ethereum-compatible networks —layer 2s and others that run the EVM— the same address works on all of them. But sending an asset over the wrong network can leave it where you don't expect it, or where you can't get it back. Before sending, always check the source and destination networks.
Where to go next
A wallet is more than a place to keep assets: it's the starting point of your identity on the internet. The next block explains how your wallet, your ID and the blockchain relate to each other.
FAQ
What happens if I lose my phone?
If you have your recovery phrase, you install a wallet on another device, enter the phrase and get everything back. Without the phrase, whatever was in that wallet is lost.
Can I have several wallets?
Yes, and it's a good idea: one for everyday use with small amounts, another to keep what matters and an empty one to try new sites.
Is the address an exchange gives me my wallet?
No. It's a deposit address controlled by the platform. Some assets, such as wrapped ENS names, can be lost if they're sent there.
Sources
- ethereum.org · Ethereum accounts (accessed Sep 10, 2026)
- ethereum.org · Wallets (accessed Sep 10, 2026)
- ERC-4337 · Account abstraction (2021)
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