Create a Crypto Wallet

If you’re interested in investing in cryptocurrencies, one of the first steps you’ll need to take is to create a private key. A private key is actually a long string of letters and numbers that allows you to access and manage your digital assets in your wallet. Actually the long private key is transformed to a more user friendly string of 12 or 24 words, the so called “mnemonic seed phrase” or “recovery seed”.

There are several ways to create a private key respectively the mnemonic seed for a new crypto wallet, including using hardware wallets, hot wallets, and software tools.

Alternatively to the acutal private key in binary or hexadecimal style, you will likely be given a mnemonic seed phrase when creating a wallet. This is a series of 12-24 words that can be used to restore access to your wallet if you lose your private key. Therefore they are also called revocery seed. These mnemonic seed phrases are commonly in use as they bring a high level of safety combined with much more user friendliness. As a deep cold storage the TIP TOP WALLET is therefore designed to store particularly such mnemonic seeds.

Recover from a Backup

It’s important to note that some wallets, both hardware and software, allow you to enter your mnemonic seed phrase to recover your wallet in the event that you lose your private key. For example, if you set up a hardware wallet and write down your seed phrase into the TIP TOP WALLET, you can use that phrase to recover your wallet if the device is lost or damaged. Similarly, many software wallets allow you to store your recovery seed phrase when setting up the wallet, which can be used to restore access to your wallet if you forget your password.

As different wallets hadle the mnemonic seed words in a different way (derivation paths), it is recommended to use the same product again to recover your wallet.

It’s always a good idea to backup your mnemonic seed in a deep cold wallet such as the TIP TOP WALLET and keep it in a different, safe and secure location, to ensure that you can always recover your wallet if needed.

Further information can be found on https://walletsrecovery.org/

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Hardware Wallets

Hardware wallets offer a very secure way to generate and store private keys. These devices are small, physical devices that plug into your computer or smartphone. They might look like like a claculator or like an USB-stick, but they aren’t. They are not connected to the internet and generate private keys using a random number generator (RNG), which ensures that the keys are truly random and cannot be predicted or duplicated. Some of them even allow to enter own entropy.

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Hot Wallets

Hot Wallets	default mnemonic length	BTC derivation path (BIP)	External entropy	Backup recovery
Exodus	12 words	m/44'|84'|86'/0'/0'	No	Exodus Recovery
Mycelium for Android	12 words	m/44'|49'|84'/0'/n'	No	Mycelium Recovery
Mycelium for iOS	12 words	m/44'/0'/n'	No	Mycelium Recovery
Samourai	default 12 words max. 24 words	m/44'|49'|84'/0'/0'	No	Samourai Recovery
Wasabi	12 words	m/84'/0'/0'	No	Wasabi Recovery

Above mentioned mnemonic length revers to the default # of words when creating a new wallet. Anyway, most of them allow 24 words (BIP39) to enter for recovery of a wallet. Still it is recommended ot use a hardware wallet to recover a wallet.

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Private Key Generator

Finally, you can also generate a private key using a software tool such as a private key generator. These tools are often open source (free to use) and can be downloaded from various online sources. However, it’s important to use caution when using these tools, as they are not always reliable or secure. It’s essential to research any tool thoroughly before using it to generate a private key.

private key generators	default mnemonic length	BTC derivation path (BIP)	External entropy	Note
Ian Coleman https://iancoleman.io/bip39/	12, 15, 18, 24 words and more	various	Dice D6, Hex Dice (TipTopWallet), Cards, Coins etc.	Private key generator: No possiblity to send coins Source Code: https://github.com/iancoleman/bip39 Dobule Check and confirm all links yourself!!!
BitAddress https://www.bitaddress.org	No mnemonic			Limited benefit: Doesn’t create mnemonic. Private key provided as HEX & WIF only.

Decentralized exchanges

Decentralized exchanges are relatively new and operate on a peer-to-peer basis, with no central authority controlling the exchange. They are designed to be more secure and transparent than centralized exchanges, but often offer less liquidity.

Peer-to-peer exchanges

Peer-to-peer exchanges allow users to trade cryptocurrencies rather directly with each other, without the need for a centralized authority. These exchanges are often used by individuals seeking to buy or sell cryptocurrencies quickly and anonymously.

Centralized exchanges

Centralized exchanges are obviously the most common type of crypto exchange and operate similarly to traditional stock exchanges. They are run by a company or organization and require users to deposit funds (typically FIAT like Dollar or Euro) in order to buy or sell cryptocurrencies.

A large list of crypto exchanges can be found for example on coinmarketcap: https://coinmarketcap.com/rankings/exchanges/

We collected an excerpt of some centralized exchanges below. No links – please make sure you reach to the correct page.

Hardware wallet & hot wallet

For any crypto owner, knowing the current balance is crucial. Most owners prefer to check it first via their hardware wallet or hot wallet for convenience and security. However, blockchain explorers are also a great option to check the balance, especially when dealing with deep cold wallets.

Blockchain explorers

Blockchain explorers are web-based tools that allow users to explore and analyze the data stored on a blockchain. By entering a wallet address (NOT the private key!), transaction hash, or block height into a blockchain explorer, users can gain insights into the transaction history, current balance, and other important data related to a particular cryptocurrency account.

These explorers help users to track their transactions, monitor the network’s health, and identify any potential issues or suspicious activities on the blockchain. Additionally, they can be used to explore the history of a particular cryptocurrency, examine block rewards, and view other relevant information related to the blockchain’s operation.