A cryptocurrency wallet is an interface for interacting with blockchain accounts. It can display balances, help send transactions, and request signatures. The assets are recorded on the blockchain rather than physically stored inside the app.
A public address can be shared to receive funds. A private key authorizes actions and must remain secret. A wallet interface may manage multiple accounts, so an account and a wallet are not the same thing.
Software and hardware
Wallets come in mobile, desktop, browser, and hardware forms. Hardware devices can keep keys offline while signing transactions. The right distinction to understand first is who controls the keys: you, or a service acting on your behalf.
A wallet is an interface to blockchain keys
The application helps create addresses, display balances, and sign transactions. The blockchain remains the authoritative transaction record, not the wallet screen.
Custody changes the responsibility
With a hosted exchange account, a provider manages the private keys. In self-custody, the user controls the means of authorizing transactions and recovering access. Convenience and recovery options therefore depend on the custody model.
A wallet password and a recovery phrase are not interchangeable. The password may only unlock a particular device, while the recovery material can recreate access elsewhere. The exact setup depends on the wallet.
Recovery depends on the custody model
A self-custody wallet generally relies on a recovery phrase or other key backup. A custodial account relies on the provider’s account-recovery process and continued control of the service.
Sources
Educational information, not investment advice.