Blockchain wallet from beginner to proficient

TokenPocket

特邀专栏作者

2019-12-19 07:55

This article is about 8316 words, reading the full article takes about 12 minutes

Summary of blockchain wallet knowledge points.

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Summary of blockchain wallet knowledge points.

Table of contents

1. History of blockchain wallet development

2. Basic knowledge of blockchain wallet

3. Blockchain Wallet Classification

4. Function introduction of blockchain wallet

5. How to choose a wallet

6. Blockchain Wallet Navigation

Eight, blockchain wallet knowledge self-test

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1. History of blockchain wallet development

During this period, the wallet developed from a single-asset wallet and a single-chain wallet to a multi-chain multi-asset wallet, and from a single transfer and collection wallet to a blockchain ecological service platform.

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Wallet 1.0 Period (2009-2013)

In 2009, the Bitcoin mainnet was launched, and the blockchain in this period had just started. As a huge distributed ledger, Bitcoin only had simple transfer and bookkeeping functions.

On June 29, 2011, Bitcoin payment processor BitPay launched the first Bitcoin e-wallet for smartphones. On July 6 of the same year, a free bitcoin digital wallet app appeared in the Android app store, which was the first smartphone app related to bitcoin.

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Wallet 2.0 Period (2014-2018)

In 2014, the launch of the Ethereum project announced that the blockchain entered the 2.0 era, and smart contracts began to be applied to the blockchain.

In addition to transfer and collection, the wallet at this time can also perform contract operations on the chain. However, due to the slow speed of the blockchain at this time, the wallet can only perform non-instantaneous response contract services.

A smart contract is a set of computer programs that can guarantee the execution of the contract without the need for a third party. Anyone can perform calculations and develop application layers based on this.

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Wallet 3.0 period (2018-present)

Beginning in 2018, the blockchain 2.0 has been optimized for slow speed and high miner fees, etc., and the realization of high concurrency and high scalability of the blockchain marks the entry of the blockchain into the 3.0 period, and the most representative one is EOS .

The block generation speed of EOS is 0.5 seconds. Regardless of the network environment and other issues, a transaction is recorded on the blockchain in only 0.5 seconds
At this time, the wallet, in addition to the basic storage and transfer function, can also interact with the contract on the chain in real time; the wallet is no longer a simple asset management tool, but a public chain ecological service platform; at the same time, the single-chain wallet has already Unable to meet user needs, more and more wallets are developing in the direction of multi-chain.

The wallet has gradually assumed its role as the entrance to the blockchain world.

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To learn to use a blockchain wallet, you must master the following definitions of five related terms, namely public key, private key, mnemonic, Keystore, and password.

public key

Public key = account number = transfer address, which is equivalent to your bank card number. The public key can be disclosed to the outside world at will without any risk, just like others know your bank card number, and can do nothing but transfer money to you.

private key

private key

Private key = identity authentication, which is equivalent to your bank card number + password. The private key is composed of numbers and uppercase and lowercase letters, and the length of the private key of different blockchains is generally different. The public key can be derived from the private key. It should be noted that once your private key is lost or forgotten, it cannot be retrieved, so be sure to keep it safe.

mnemonic

Keystore

Keystore=card number, the essence of Keystore is an encrypted private key, and Keystore must be used with your wallet password to be valid. Keystore, private key, and mnemonic are common to all wallets. Wallet service providers may only provide users with one or more of these methods due to product design reasons. There may be some problems with the wallet.

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In order to further enhance security, most wallets will use passwords to encrypt the private key twice. The encryption method and storage method of each wallet are different. This is why you always need to authorize when you use the wallet to conduct transactions. Behind this actually involves the wallet using the password to decrypt the private key, and then using the private key to sign the transaction and other complicated processes.

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Wallet Security Tips
The public key can be exposed without affecting the security of your assets. It is equivalent to telling someone your bank card account number.
Once the mnemonic and private key are leaked, the assets will be at great risk of being controlled by others. At this time, you need to transfer the assets to other addresses immediately, and the original address will no longer be used.
If the keystore is leaked, no matter whether the password is leaked or not, there is a risk that others will control the assets, so it is necessary to transfer the assets to other addresses as soon as possible.
When storing private keys and mnemonic words, we recommend using offline methods (manual copying, printing, etc.) for data backup, and at the same time keep the backed up content properly. For information such as the keystore, it is unscientific and error-prone to use transcription for backup, so users can store the keystore as a file, and then store it in the U disk and then properly manage the U disk; among them, we are very It is not recommended that you back up by screenshots, network transmission (QQ, WeChat), cloud storage, etc. These methods may be attacked by hackers, resulting in asset loss.

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3. Blockchain Wallet Classification

We will classify wallets from two directions: storage of private keys and generation of private keys.

private key storage

According to the storage method of the private key, that is, whether the user has the private key, we can divide the wallet into "centralized wallet" and "decentralized wallet".

The storage method refers to where it exists. Only when the user holds the private key and imports it into the wallet, the private key is only stored on the user's device is called "decentralization". There is no private key, or the private key is uploaded and stored in the server of the service provider. , it is "centralization".

Common hot wallets include desktop wallets, mobile wallets and web wallets. Cold wallets generally refer to tools such as paper wallets and hardware wallets that are not connected to the Internet or cannot be connected to the Internet.

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Wallet category

According to the degree of decentralization of wallets, wallets can be divided into full-node wallets, light-node wallets, and centralized wallets.

The full-node wallet is to synchronize all the data on the blockchain to the wallet, which will take up a lot of storage space, so most full-node wallets are desktop wallets. Among them, the most representative ones are Bitcoin core wallet, Geth, Parity and so on. Just because the full-node wallet needs to synchronize all block data, it can achieve complete decentralization.

According to DApptotal data, as of September 2019: Ethereum’s full node data size is 433GB, EOS’s is 430GB, and Bitcoin’s is 279GB

The data of the decentralized wallet is all data on the blockchain, while the data of the centralized wallet relies on the wallet service provider's own ledger. For example, our wallet in the exchange is a centralized wallet. We transfer money to an address designated by the exchange, and then the exchange records our recharge record on its own account book. After that, every time we make a recharge transfer, the transaction So add or subtract directly on his ledger. And this whole process did not happen on the blockchain at all.

node wallet

private key generation

(The content of this section is slightly beyond the outline)

From the generation of private keys, we can divide wallets into "non-deterministic wallets", "deterministic wallets" and "hierarchical deterministic wallets", among which "hierarchical deterministic wallets" are "deterministic wallets" Enhanced version.

There is no relationship between the private keys generated in the wallet and are independent of each other.

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non-deterministic wallet

The private key is generated by a "seed" through an algorithm, for example, the "mnemonic" is the form of the seed. The private key generated in this way, as long as the algorithm is consistent, the private key can be kept consistent; and a seed can derive unlimited private key addresses.

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deterministic wallet

But as long as the position you choose is the same, the leaf at that position will always be the same. And the leaf here is the "private key" we mentioned.

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It is an enhanced version of the deterministic wallet, which introduces the concept of "master private key" for the deterministic wallet, that is, HD wallet. Its hierarchical structure is that the private key generated from the master private key itself can become a master private key, and then a deterministic wallet is generated through the above method.

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Hierarchical Deterministic Wallets

Similarly, we can compare the "hierarchical deterministic wallet" to a tree trunk;

Therefore, as long as we determine a certain position on a certain branch, then this leaf is determined. That is, the private key is determined.

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The wallet is the entrance of the blockchain, and has rich functions including asset management, which can meet various needs of users.

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Create a blockchain account

The display form of the blockchain wallet is divided into address and account number, which we collectively refer to as account number here;

The accounts of different blockchains are different, and the length may also be different.

The creation fees of different blockchain accounts are also different. For example, the accounts of Ethereum and Bitcoin are free, but the accounts of EOS need to consume a certain fee to create.

Since the creation of a blockchain account is a complex process, the existence of the wallet is to help users simplify these processes.

Generally, in the process of creating an account, the wallet will guide the user to back up the private key or mnemonic phrase, and then perform secondary verification to ensure that the private key or mnemonic phrase backed up by the user is accurate.

For novice users, mastering the private key may be too troublesome, so TokenPocket designed a decentralized mobile phone number/email account registration method based on EOS. This method supports users to retrieve the private key through verification codes when they forget it. , just like we usually use Internet products, if you forget the password, you can log in through the verification code, which greatly reduces the difficulty for users to use the wallet.

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Digital Asset Management

Digital assets mainly refer to various tokens (Tokens) on the blockchain. The existence of wallets greatly facilitates the management of assets owned by users, mainly including transfers, collections, viewing asset details, transaction details, etc. .

It should be noted that assets between different blockchains cannot be transferred directly, that is, you cannot transfer BTC (Bitcoin) to an Ethereum account, nor can you transfer ETH (Ethereum) to a Bitcoin account.

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Digital asset transaction

The current digital asset transactions supported by the wallet mainly include the following three situations: currency exchange, exchange transactions, and OTC transactions.

currency exchange

Through currency exchange, assets on different blockchains can be exchanged. For example, you can directly exchange your own BTC (Bitcoin) into EOS.

General transactions can only be traded in the form of a basic pair, and then traded into the final destination currency through the basic pair.

For example, if I want to change from A to C, I need to implement it through intermediary B, A -> B, B -> C;

The currency exchange simplifies this process and directly converts A into C

exchange traded

There are currently three forms of exchanges, namely centralized exchanges, decentralized exchanges, and aggregated exchanges.

Common centralized exchanges include Huobi, Binance, OKEX, etc. Decentralized exchanges include IDEX on Ethereum, NewDex, Whale Exchange, DEXEOS, etc. on EOS.

Centralized exchanges require us to host coins in exchange accounts, and then transactions only occur in the exchange's centralized data.

However, decentralized exchanges do not need this process.

This greatly reduces the risk of loss of user assets caused by the exchange being stolen or running away.

In decentralized exchanges, users transfer coins to smart contracts through wallets, and smart contracts complete on-chain matching transactions, and then transfer coins back to users.

Contract transactions, while improving transparency, also greatly reduce the dependence on the central intermediary.

Aggregate exchange

Aggregation exchange is to gather all exchanges to form a trading platform, which allows users to easily conduct cross-platform transactions without downloading many apps. Aggregated exchanges share the depth of other exchanges and the trading pairs of other exchanges. For example, after you register an aggregate exchange account, every time you buy or sell BTC (Bitcoin), you can choose the most cost-effective transaction from different exchanges.

OTC (Over The Counter) trading is outside the exchange, guaranteed by a third party, and the customer's point-to-point transaction method. OTC in the blockchain usually refers to one-to-one buying and selling transactions between legal currency and digital currency between off-site users.

At present, the largest OTC is mainly the OTC of the exchange, and some wallets have access to third-party channel providers that provide this service.

For example, TokenPocket has access to the OTC service of currency trading. When users use the TP wallet, they can easily sell the digital currency in their hands and exchange it for legal currency; or use legal currency to buy digital currency.

Participate in ecological construction

At present, in the design of some public chains, users in the ecology are encouraged to actively participate in the ecological construction of the public chain. The main forms are node voting, referendum, staking, etc.

Taking EOS as an example, EOS has a total of 21 super nodes. Users can vote for up to 30 nodes after mortgaging their EOS. The purpose of voting is to allow users to select nodes that can contribute to the development of the ecology. So as to promote the stable development of the ecology.

referendum

referendum

Staking

The Chinese name of Staking is equity pledge. At present, some public chains adopt the form of Staking to encourage currency holders to pledge Token, and thus generate stable nodes. For example, COSMOS pledge can enable the pledger to obtain a certain annualized income (settled in pledged currency), similar to your investment in a current wealth management bank.

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Experience DApp application

DApp is the abbreviation of Decentralized Application, translated as a decentralized application, which refers to the development of applications based on the blockchain.

At present, DApp is mainly concentrated on blockchains such as Ethereum and EOS, TRON, and IOST. The relationship between DApp and the underlying platform is like the relationship between APP and iOS and Android systems.

At present, some large-scale games exist in the form of third-party independent APPs. When experiencing these DApps in the form of APPs, you also need a wallet as a medium for login and transaction authorization.

DApp store

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Receive candy rewards

The advantage of having a wallet is that you can get candies from time to time.

Common candy distribution methods on the market include: registration and collection, currency airdrop, advertising candy, Airgrab, transfer airdrop, etc.

Candy refers to the free Token on the blockchain

Usually, there are often free candy collection activities during the early promotion of the project. Just register and register your own blockchain account (such as ETH address, EOS account, etc.) on the event page of the project party, and wait for the project party to issue rewards. Free candy too.

Coin holding airdrop:

There are two common ways to hold currency airdrops. One is forking coins, such as BTC (Bitcoin) forking out of BCH, all users who held BTC (Bitcoin) before the fork, according to BTC (Bitcoin) The corresponding amount will be obtained in BCH.

The other is to issue another Token reward directly to the token holders. For example, when the first airdrop token on EOS, ADD, was launched on the EOS mainnet, a snapshot of the entire network account was taken, and then the EOS holdings were rewarded. account for candy distribution.

Advertising Candy:

MEMO refers to the remarks in the blockchain transfer information

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Airgrab：

Candy Airdrop

Chinese can be called candy grabber, which is a way of candy distribution on EOS, which needs to consume the user's memory (each token needs about 0.25KB). After executing Airgrab, you need to wait for the project party to airdrop.

Transfer Airdrop:

For well-known transfer airdrops such as EIDOS, users only need to send 0.0001 EOS to their contract account, and the contract will return 0.0001 EOS and give away 0.01% of the current remaining EIDOS in their contract account.

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Because it is possible to quickly log in to the decentralized exchange in the wallet, many users can directly sell it on the exchange after receiving the candy and exchange it for EOS, USDT and other Tokens. The feeling of free wool is awesome.

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asset appreciation

Wallets naturally have financial attributes. Currently, wallets have integrated a variety of financial tools and functions including mining pools, wealth management, mining, and project investment, which can meet the needs of users for asset appreciation.

Mining pool:

Currently, there are mainly two methods of mining: POW mining and POS mining.

POW (Proof of Work) is computing power mining, which is also familiar to us such as BTC (Bitcoin), ETH (Ethereum) mining; POS (Proof of Stake) mining is to imitate POW computing power mining. Tokens can be mortgaged to validator nodes to obtain rewards and dividends.

At present, the mining pool of the wallet is basically based on POS mining. Some wallets also support the purchase of cloud computing power for BTC (Bitcoin) mining.

Financial management:

The wealth management products in the wallet are very similar to traditional wealth management products, the only difference is the settlement method. Usually, an estimated rate of return is agreed upon. After the user purchases the wealth management product with Token, regular settlement will be made according to the agreed settlement date, and the contract can be withdrawn or renewed upon expiration.

Mining:

Mining is mainly based on DApp mining. Some DApp mining machine products are collected in the wallet. Using the mining machine can easily and quickly obtain the Token you want to mine. Take the recently popular EIDOS as an example, the EIDOS mining machine can help users realize automatic transfer mining. These mined Tokens can be sold on exchanges to obtain income.

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social contact

Some blockchain wallets also have social functions, and you can communicate with other users in the wallet. Like the chat channels of TokenPocket and Block Letter, you can join different groups and chat freely with members in the group. And you can also send and receive digital currency red envelopes in the chat group.

Trybe is a social network and media publishing community motivated by digital currency. Users can get digital currency from Trybe by creating beautiful content, rating other people's content or inviting friends!

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Hardware wallet supporting management tool

Similarly, software wallet manufacturers will also cooperate with hardware wallet manufacturers to develop their own product-specific hardware wallets, such as Bitpie’s hardware wallet Bitshield, imToken’s imKey, etc.

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Blockchain Information Acquisition

Different from other blockchain media, the wallet newsletter and articles mainly focus on the blockchain-related content supported by the current wallet, which is more targeted.