What is Software Wallet?
Let's find out Software Wallet meaning, definition in crypto, what is Software Wallet, and all other detailed facts.
A software wallet, also referred to as a wallet app, is a program that gives access to the users' owned cryptocurrencies. It can be installed on any device whether it’s a phone, a tablet, or a computer.
Software wallets enable easy interaction between a user and a blockchain by facilitating graphical user interfaces (GUIs). This is done since cryptocurrencies are stored on-chain.
There are three types of software wallets: mobile, desktop, and web.
The most well-known software wallets include Guarda Wallet, Electrum Bitcoin Wallet, Exodus Wallet, and Coinbase Wallet.
It’s important to note that software wallets are encrypted. This means that in order to be granted access, one has to know the password of the software wallet.
Generally speaking, software wallets are considered to be non-custodial which refers to the absence of a central authority that has custody of a cryptocurrency stored within a specific wallet. The end-user has the ability to transfer cryptocurrency held in a software wallet. They can do this through private keys.
Typically, there is a link between software wallets and cryptocurrency exchanges. Moreover, there are software wallets that are connected to exchanges where cryptocurrency trading is facilitated by AMMs or atomic swaps.
What are the main advantages of software wallets?
- Ease of access. Anyone can have a software wallet since it comes at no cost. This is a substantial advantage over hardware wallets;
- User-friendly. Software wallets are accessible via mobile phones, tablets, and computers;
- Convenience. Its users are able to easily participate in exchange by buying and selling cryptocurrencies. Users can also send and receive cryptocurrencies;
- Multi-chain support. It supports multi-coin, also known as multi-chain, wallets.