Understanding Bitcoin Wallets

A Bitcoin wallet consists of two important elements: a unique public address (where BTC can be sent) and a private key (akin to a password). In the case of a paper wallet, both of these elements are represented by QR codes, which are used by the BTM to issue Bitcoin onto the paper wallet. Since the paper wallet holds the private key, it functions similarly to physical cash. The holder of the paper wallet can spend the BTC associated with it by utilizing the private key. The actual amount of BTC contained within the wallet is recorded on the Bitcoin blockchain, a distributed ledger.[1]

Apart from paper wallets, there are virtual digital wallets available as mobile phone applications, compatible with Android, Apple, and Blackberry devices. These apps allow users to import BTC from a paper wallet, send BTC to other wallet addresses, and often provide real-time BTC to $CAD currency quotations. Some digital wallets even utilize the NFC (near field communication) technology present in mobile phones, enabling instant transactions between NFC-equipped devices. With a digital wallet, you can easily send BTC to any other digital wallet.

Once you purchase a paper wallet from the BTM, you can download a digital wallet of your choice onto your mobile phone. Simply scan your paper wallet using the digital wallet app to import your new BTC into your phone. Remember to keep the paper wallet as a backup, but treat it as you would digital cash since anyone who finds and spends the BTC before you would have control over it. It’s important to exercise caution and safeguard your paper wallet accordingly.

Digital wallets are also available for computers and tablets, and you can explore various options and read reviews by conducting a Google search. However, in the following sections, we will focus on mobile phone applications for digital wallets.