What Is a Wallet Address?
In the world of cryptocurrency, a cryptocurrency wallet address is the identifying string of characters associated with a person’s crypto assets. Just like an email address tied to your own email account, it works by allowing holders to send and receive information. You can use your wallet address to send cryptocurrencies or digital assets to another trader on the same blockchain. You can also share your wallet address with another person so they can send assets to you.
Given their complexity, wallet addresses are difficult for humans to memorize and interpret. Computers, on the other hand, have no problem storing and recognizing them instantly. This makes them convenient markers of identity in a fully digital ecosystem.
Wallet Address Format
Each blockchain has its own style of digital wallet address.
On the Ethereum blockchain, an Ethereum wallet address starts with the characters “0x” and typically has 40 hexadecimal characters in it. A wallet address, therefore, could look something like: 0xb794f5ea0ba39494ce839613fffba74279579268.
Bitcoin wallet addresses, meanwhile, always start with 1, 3 or bc1. They are also typically made up of 27 to 34 alphanumeric characters. That means a BTC wallet address could appear, for example, as 3FZbgi29cpjq2GjdwV8eyHuJJnkLtktZc5. On the Avalanche blockchain, crypto wallet addresses are slightly easier to distinguish. They use a Bech32 addressing format where each virtual machine has its own unique identifier. For example, the Avalanche C-Chain has addresses that begin with “C”, the Avalanche P-Chain has addresses that begin with “P”, and lastly, the Avalanche X-Chain has addresses that begin with “X”. The wallet address is then immediately followed by “avax1”, making it obvious to users that they are making transactions on the Avalanche blockchain.
How to Use a Wallet Address
People use wallet addresses to send and receive cryptocurrency, NFTs and other digital products. A single trader can possess several addresses within a single crypto wallet. They can then use whichever address best suits the particular transaction they’re interested in completing.
Wallet addresses are necessary for transferring funds and assets between users on a blockchain. The process for sending money to another user is simple. All you need to do is ask for their wallet address, then use that wallet address to transfer the funds. While each blockchain has its own specific protocols, the general process is the same. Conducting the transfer is as quick and easy as sending an email.
When sharing your own wallet address or sending an asset to somebody else’s wallet, it’s vital that every digit is correct. Wallet addresses are case-sensitive, and a single typo will cause the transaction to fail. In most cases, it’s best to copy and paste the address. After doing so, triple check the address. That way, you can avoid derailing the transaction with a silly mishap.
Alternatively, you can also scan the QR code of the wallet address since most wallets have this feature. This would make it easier and prevent you from making any typos.
Most crypto trading platforms make it easy to find your wallet address. Just enter the web page or app, then search for the address within the various tabs. Some platforms also allow you to share your wallet address with other users within the program itself.
Wallet Address on Public or Private Blockchain
The visibility of a wallet address depends on whether the blockchain is public or private. Public blockchains, also known as permissionless chains, are completely open. They adhere to the concept of decentralization, and they allow anyone to add blocks to the chain. Some of the most well-known chains in the world, such as Bitcoin and Ethereum, are public.
On public chains, wallet addresses are visible to other users. This doesn’t mean your personal identity is exposed, because most chains allow for anonymity. People won’t know that you’re the owner of the wallet address, but they will be able to see that the address exists on the network. They’ll also be able to see the transactions and account balance associated with the wallet.
Private blockchains are smaller ledgers operated by centralized authorities. While this centralization runs counter to the ethos of many people in the crypto world, it helps provide speed, trust and efficiency. Prominent private chains include Hyperledger and Ripple.
The centralization of private chains means that wallet addresses don’t necessarily have to be public. Ultimately, it’s up to the central administrators to manage the wallets on the chain. While this might make private blockchains seem appealing, they aren’t as easy to join as public chains. By definition, you need permission from the central authorities to join them. While this is sometimes attainable, it will depend on the goals of the project and your own plans as a trader.