WEBVTT - What Is A Crypto Wallet w/ Will Lucas 0:00:01.240 --> 0:00:05.200 Special announcement before we get into today's episode. UM at 0:00:05.200 --> 0:00:09.200 afro Tech Executive is past week in Miami, bag shouse 0:00:09.200 --> 0:00:11.840 out to everybody who pulled up. We had a remarkable 0:00:11.880 --> 0:00:16.000 time talking about n f T S, DOWS, blockchain and 0:00:16.079 --> 0:00:18.799 more with some of the most right, the brightest minds 0:00:18.840 --> 0:00:21.880 in the game. UM, and they just happened to be black. 0:00:22.000 --> 0:00:24.320 So we had a great time in Miami. But in 0:00:24.440 --> 0:00:27.840 Miami we announced that we are back I R. We 0:00:27.880 --> 0:00:30.920 are back in real life this year. Come Hell of 0:00:31.000 --> 0:00:36.640 high Water for the Official afro Tech Conference in November. UM. 0:00:36.760 --> 0:00:38.400 We're taking the show in the road too. So if 0:00:38.440 --> 0:00:43.800 you remember, afro Tech started years ago in San Francisco, 0:00:44.360 --> 0:00:47.720 then we after a couple of years moved over to Oakland. 0:00:48.360 --> 0:00:52.120 We're moving again this year. You can meet us afro 0:00:52.240 --> 0:00:57.840 Tech Conference in Austin, Texas. We are coming to the 0:00:57.880 --> 0:01:02.360 lone star state, Austin and you're getting to find amazing food, 0:01:02.400 --> 0:01:06.839 great life, music and come this November twenty thousand, Black 0:01:06.920 --> 0:01:10.000 tech Y's will converge on the city for the first 0:01:10.120 --> 0:01:14.360 in person official afro Tech conference in two years. We 0:01:14.440 --> 0:01:17.959 have missed y'all and we are long overdue for this 0:01:18.000 --> 0:01:22.800 party and learning experience from my group of people out there. 0:01:23.319 --> 0:01:26.640 As the early bird tickets are live now, don't delay 0:01:26.680 --> 0:01:29.760 in getting yours today. Get um yours at experience dot 0:01:29.760 --> 0:01:34.000 afro tech dot com and also, guess what we are 0:01:34.160 --> 0:01:39.760 also pulling up this month March in Brooklyn for the 0:01:39.800 --> 0:01:46.000 second afro Tech Executive of afro Tech Executive Brooklyn will 0:01:46.040 --> 0:01:48.960 be there and talking about women in tech and women 0:01:49.040 --> 0:01:52.200 in leadership is going to be a vibe. Tickets to 0:01:52.440 --> 0:01:56.240 a t Exact Brooklyn are also available now at afro Tech. 0:01:56.680 --> 0:02:03.760 I'm sorry, Experience dot afro tech dot How so what 0:02:03.920 --> 0:02:08.720 is a crypto wallet? Um? You've likely you likely have 0:02:08.720 --> 0:02:13.080 a wallet, you know, sitting nearby you somewhere, probably in 0:02:13.120 --> 0:02:15.960 your pocket, maybe it's in your backpack or in your 0:02:16.000 --> 0:02:19.160 tell far back. Maybe you know the concept, but your 0:02:19.160 --> 0:02:23.640 wallet is likely where you store your physical credit cards, 0:02:23.639 --> 0:02:26.240 your I D. Maybe you even have a little cash 0:02:26.360 --> 0:02:29.960 in your wallet. The point is we're all familiar with 0:02:30.040 --> 0:02:34.680 this concept. You have a physical storage container, usually like 0:02:34.840 --> 0:02:37.960 leather or fold leather, where you store things that you 0:02:38.000 --> 0:02:40.480 need access to, but you want to keep them secure 0:02:40.720 --> 0:02:45.160 and somewhat organized. Uh. Typically these things have to do 0:02:45.240 --> 0:02:48.840 with storing currency. These wallets do paying for things or 0:02:49.160 --> 0:02:51.480 validating who you are, like in the case of having 0:02:51.480 --> 0:02:55.560 your idea in it. A crypto wallet UM is effectively 0:02:55.600 --> 0:02:59.959 the same thing, but it's specifically designed to store crypt 0:03:00.040 --> 0:03:06.840 though in like passwords. There are hardware wallets, cold wallets, 0:03:07.280 --> 0:03:11.360 UM and hot wallets, and we'll let's not get ahead 0:03:11.360 --> 0:03:13.639 of ourselves, all right, So let's let's just walk this out, 0:03:13.680 --> 0:03:15.840 because I don't want to jump too far ahead, because 0:03:15.880 --> 0:03:19.000 it's very tempting to right now. But hardware wallets we 0:03:19.040 --> 0:03:22.119 call them cold wallets, or you have like online wallets 0:03:22.160 --> 0:03:25.800 that are called hot wallets. But first let's talk about 0:03:25.800 --> 0:03:30.000 the purpose of a crypto wallet in any case. All right, So, 0:03:30.880 --> 0:03:34.480 if you've been listening to this show for any length 0:03:34.480 --> 0:03:38.559 of time, specifically like in the last well since two, specifically, 0:03:38.800 --> 0:03:42.120 we've been talking a lot about crypto n f T s, 0:03:42.200 --> 0:03:45.360 things like that, and hopefully by now I've built up 0:03:45.440 --> 0:03:49.120 some kind of appetite in you to invest in yourself 0:03:49.320 --> 0:03:52.720 in web three, whether it be buying in n f T, 0:03:53.720 --> 0:03:59.040 exchanging your US dollars or rubles for ethereum or a 0:03:59.080 --> 0:04:04.160 sheep of coin um. But just like we describe what 0:04:04.240 --> 0:04:08.160 we're all pretty used to the wallet. In the crypto wallet, 0:04:08.840 --> 0:04:11.800 these things store things that you might need access to, 0:04:12.080 --> 0:04:15.400 like your currency cryptocurrency. It allows you to pay for 0:04:15.520 --> 0:04:18.479 things in Web three, and it allows you to validate 0:04:18.600 --> 0:04:22.200 who you are your crypto wallet. It does and among 0:04:22.240 --> 0:04:25.680 the most important things of crypto wallet it does. And 0:04:25.720 --> 0:04:29.080 I just alluded to this is regarding the storage of 0:04:29.240 --> 0:04:32.719 things you may need access to. Now I set this 0:04:32.839 --> 0:04:35.479 up in the form of storing crypto, but there's a 0:04:35.560 --> 0:04:39.560 level deeper that are wallet stores and that and that's 0:04:39.960 --> 0:04:44.560 what we call keys. So not like physical keys today 0:04:44.600 --> 0:04:48.039 that you know may turn on your vehicle or let 0:04:48.080 --> 0:04:50.560 you in your house, and one day I'm sure we'll 0:04:50.600 --> 0:04:54.680 get there, but I'm talking about your public and private keys, 0:04:54.720 --> 0:05:00.000 the passwords that give you access to your cryptocurrencies. Um 0:05:00.000 --> 0:05:01.919 now you might be asking, you know, I thought my 0:05:01.960 --> 0:05:05.680 crypto was stored on or in the wallet, and well, 0:05:06.080 --> 0:05:09.280 you may have crypto, but it's not like physically in 0:05:09.600 --> 0:05:12.400 your crypto wallet, like your U S dollars might be 0:05:12.520 --> 0:05:16.919 in your Louisatime wallet. In Web three, your currency is 0:05:16.960 --> 0:05:21.120 basically just a recording on a ledger. There's no physical 0:05:21.560 --> 0:05:24.920 coin or token you can see. It's a record. It's 0:05:24.960 --> 0:05:28.479 a line of code. It's an instance that is secured 0:05:28.920 --> 0:05:33.000 by the blockchain. It can be altered or forged. It 0:05:33.080 --> 0:05:35.840 can it can be stolen. But again let's not get 0:05:35.839 --> 0:05:37.960 ahead of ourselves. We're gonna talk about that. But the 0:05:38.040 --> 0:05:41.920 record does last forever um that it was in your 0:05:42.279 --> 0:05:46.120 proverbial hands. I want to give again a quick primer 0:05:46.400 --> 0:05:50.800 on how the blockchain works because it's important for this conversation. 0:05:51.320 --> 0:05:56.240 The blockchain is a distributed database. Think of it like 0:05:57.000 --> 0:06:01.039 a hard drive or a computer that is replicated in 0:06:01.080 --> 0:06:03.280 A gang of people all over the world have the 0:06:03.800 --> 0:06:07.360 same copy, the same version of this hard drive or 0:06:07.440 --> 0:06:12.120 computer with the storage devising it, and they're constantly validating 0:06:12.560 --> 0:06:15.039 the files on each other. So the computer, the the 0:06:15.120 --> 0:06:20.800 hard drive that's in you know, Mississippi, is validating the 0:06:20.880 --> 0:06:25.400 same storage and records of the computer that I may 0:06:25.520 --> 0:06:29.119 have in Las Vegas, or in Atlanta or in New York. 0:06:29.520 --> 0:06:32.080 So they're all like you know, validating each other to 0:06:32.160 --> 0:06:35.920 make sure they're correct and to verify transactions that happen 0:06:36.080 --> 0:06:39.080 on the blockchain. So you can't say, like, you know, 0:06:39.120 --> 0:06:42.280 I have a valid copy of Donda two on my 0:06:42.320 --> 0:06:45.240 node with your computers like your node, that node on 0:06:45.279 --> 0:06:48.240 the blockchain network, because all the other nodes, all the 0:06:48.240 --> 0:06:50.520 other computers out there are going to check the record 0:06:50.560 --> 0:06:53.080 and say no, no, no, no, no, it's not valid. 0:06:53.720 --> 0:06:57.479 And then when they verify that your node has you know, 0:06:57.600 --> 0:07:01.440 malicious file on it or you know invalid filem it's 0:07:01.440 --> 0:07:05.159 not necessarily be malicious, but it's invalid. Your no, then 0:07:05.240 --> 0:07:08.559 your computer, your hard eye that's trying to insert that file, 0:07:08.640 --> 0:07:12.000 that invalid or malicious file is gonna get banned from 0:07:12.120 --> 0:07:17.160 the blockchain network because they try to insert an invalid transaction. 0:07:18.040 --> 0:07:24.360 So anyway, the blockchain is a database that stores information electronic, electronically, 0:07:24.960 --> 0:07:28.440 uh digitally, and it's redundant, so it's there's same copies 0:07:28.480 --> 0:07:31.720 all around the world. Then they're being stored by miners, 0:07:32.200 --> 0:07:33.960 which we don't have to get into that today. But 0:07:34.440 --> 0:07:38.720 what's so cool about the blockchain is that it's NonStop 0:07:38.840 --> 0:07:45.840 guaranteeing the purity, fidelity, or you know the cleanliness of 0:07:46.120 --> 0:07:49.120 the data that's being generated, and you don't have to 0:07:49.160 --> 0:07:53.440 rely on like a government or any institution um to 0:07:54.360 --> 0:07:58.680 protect that data. It's you know, it's a democratized authority. 0:07:59.720 --> 0:08:02.080 So it's probably by as far as I'm gonna go 0:08:02.440 --> 0:08:05.520 with explaining what the blockchain is in this episode, because 0:08:05.520 --> 0:08:09.280 I really only referenced that to help us understand cryptocurrency 0:08:09.600 --> 0:08:13.920 not being in our wallets physically up the record of 0:08:13.960 --> 0:08:18.240 how much ethereum or light coin or sheba I have 0:08:19.160 --> 0:08:26.120 um is stored in this distributed decentralized ledger miles long spreadsheet, 0:08:26.200 --> 0:08:31.520 if you will. So. Your wallet then stores the keys 0:08:31.760 --> 0:08:35.760 that unlock your crypto. Your wallet opens the door for 0:08:35.840 --> 0:08:39.560 your crypto to be used in the transaction, So like 0:08:39.880 --> 0:08:42.520 you're buying in f T or a cup of coffee 0:08:42.960 --> 0:08:47.760 in some innovative, forward thinking coffee house, your wallet allows 0:08:47.960 --> 0:08:51.640 others to send you crypto, as your wallet has an 0:08:51.679 --> 0:08:54.520 address that anyone can see. Again, we'll get into that 0:08:54.920 --> 0:08:59.560 private first public concept shortly, and it can serve as 0:08:59.600 --> 0:09:02.760 an actual key, like instead of using an email address 0:09:02.840 --> 0:09:06.200 and password like you might sign into like you might 0:09:06.280 --> 0:09:08.959 use to sign them too, like Instagram. You could use 0:09:09.000 --> 0:09:12.960 your crypto wallet to sign into an online service, for instance, 0:09:13.040 --> 0:09:16.319 open Sea, which we've talked a lot about on our 0:09:16.360 --> 0:09:18.840 episodes about n f t S open seas in exchange, 0:09:18.840 --> 0:09:21.319 like the Amazon of n f t S, you can 0:09:21.440 --> 0:09:25.320 use your wallet to sign in to open Sea without 0:09:25.400 --> 0:09:28.760 using like an email address and password, passwords and email 0:09:28.840 --> 0:09:31.600 justice to log in our so web two all right, 0:09:31.600 --> 0:09:37.400 And so the wallet could also store your dial token, 0:09:37.520 --> 0:09:42.440 your distribute, your decentralized autonomous organization token, the things you 0:09:42.640 --> 0:09:46.080 use to give you access to a party at the 0:09:46.200 --> 0:09:49.600 upcoming afro Tech conference in Austin. You know that could 0:09:49.600 --> 0:09:53.160 be stored in your crypto wallet. The token that you 0:09:53.320 --> 0:09:56.440 used to get into the dial like Friends with Benefits 0:09:56.559 --> 0:09:58.679 is a dial um for you by a black man 0:09:59.160 --> 0:10:01.720 um to get into that party, you know you're gonna 0:10:01.760 --> 0:10:04.640 have to bring your crypto wallet to get access because 0:10:04.760 --> 0:10:08.320 your wallet is storing the token that that validates that 0:10:08.440 --> 0:10:12.520 you have access to said party. Your wallet, so as 0:10:12.800 --> 0:10:15.359 you can tell, your wallet has a variety of functions, 0:10:15.800 --> 0:10:18.319 and we just talked about some of the most criticals. 0:10:18.880 --> 0:10:24.280 So what else should we know about a crypto wallet? Then, well, 0:10:24.280 --> 0:10:27.400 how do you get one? UM? I'm gonna say that 0:10:27.440 --> 0:10:30.600 conversation for a little later because there's a bit more 0:10:30.760 --> 0:10:34.120 foundation I want to lay so you really get a 0:10:34.160 --> 0:10:38.040 handle on what it is the wallet is and what 0:10:38.160 --> 0:10:41.840 it does and the implications of having one UM. I've 0:10:41.880 --> 0:10:44.920 said this a few times use these terms, these phrases. 0:10:44.960 --> 0:10:49.560 A few times I mentioned keys, private keys, and public keys, 0:10:50.679 --> 0:10:52.000 So this is a few times already, and I want 0:10:52.000 --> 0:10:55.719 to dig in right now. UM what um what they are? 0:10:56.320 --> 0:10:58.760 Because when I say things like a public key that 0:10:58.800 --> 0:11:02.880 allows any one to see you on the blockchain and 0:11:03.000 --> 0:11:06.480 your activity on the block chain, that might scare you, Like, 0:11:06.520 --> 0:11:09.760 you know, why why does everybody get to see that 0:11:09.840 --> 0:11:12.400 I bought said n f T. Why does everybody get 0:11:12.440 --> 0:11:15.720 to see that I sent John? You know one? Eight? 0:11:15.880 --> 0:11:19.120 Like why is that public knowledge? Well, you know number one, Like, 0:11:19.320 --> 0:11:23.400 there's no more privacy that that concept of privacy is 0:11:23.960 --> 0:11:28.079 you know a web two thing. Again, the world is changing. 0:11:28.440 --> 0:11:31.080 So that's a different conversation for a different day. But 0:11:31.280 --> 0:11:35.760 the the public key is something that anybody can see 0:11:35.840 --> 0:11:38.839 and you're not at risk of being hacked or someone 0:11:38.960 --> 0:11:42.040 still in your crypto because they have access to your 0:11:42.080 --> 0:11:44.640 public key. Your public key is supposed to be used. 0:11:44.679 --> 0:11:49.880 It's supposed to be um seeable because that's how you 0:11:49.920 --> 0:11:54.840 can make transactions. Your public key is it's a cryptographic code. 0:11:54.880 --> 0:11:59.800 It's a set of numbers and letters that allows you 0:11:59.840 --> 0:12:04.640 to receive crypto or better, it allows the record of 0:12:04.679 --> 0:12:08.800 an amount of crypto to move from my you know 0:12:08.920 --> 0:12:13.200 point on the ledger the global ledger to your name 0:12:13.400 --> 0:12:16.160 on the global ledger. So m walk with me for 0:12:16.200 --> 0:12:18.679 a minute, because I don't want you to get confused 0:12:18.720 --> 0:12:22.400 about this concept, and if it does, just hit rewind 0:12:22.480 --> 0:12:26.719 and listen again. The public key that you have if 0:12:26.760 --> 0:12:29.640 you have a wallet. Everybody has one. If you have 0:12:29.640 --> 0:12:32.360 a wallet, it's it's like a two hundred fifty six 0:12:32.440 --> 0:12:36.120 bit number, so but you will likely see more often 0:12:36.320 --> 0:12:40.280 is the wallet address, which is a scrambled version of 0:12:40.320 --> 0:12:45.520 that number. The address is a set of random characters, 0:12:45.559 --> 0:12:47.440 and not Russian say random, but there are a set 0:12:47.440 --> 0:12:51.080 of characters that have both letters and numbers in it, 0:12:51.559 --> 0:12:54.520 and the address will always begin with A one, A three, 0:12:54.679 --> 0:12:58.960 or a B C one. Digging deeper into that is 0:12:59.360 --> 0:13:01.560 outside of the scope of this episode, but it's good 0:13:01.559 --> 0:13:04.040 to know that. So let's say you want to send 0:13:04.120 --> 0:13:07.160 me your address to send you an eat a single 0:13:08.080 --> 0:13:13.720 ethereum coin. What you could do is on almost every wallet, 0:13:14.880 --> 0:13:19.720 cold wallet or hot wallet software or hardware, there is 0:13:19.760 --> 0:13:23.440 a copy paste feature that allows you to copy the 0:13:23.440 --> 0:13:26.439 set of characters like a forty two you know character 0:13:27.200 --> 0:13:30.360 um address, which is the public address of your wallet 0:13:31.040 --> 0:13:34.600 um or, and most wallets give you this feature. You 0:13:34.640 --> 0:13:38.880 can just pull up the QR code that I can 0:13:39.160 --> 0:13:43.400 read with my smart device, my you know, iPhone or whatever, 0:13:43.840 --> 0:13:48.079 and the QR code references your address that forty two 0:13:48.160 --> 0:13:52.480 character A code. Um So, then just by doing that, 0:13:52.520 --> 0:13:55.160 I can send you THEA that I owe you. The 0:13:55.240 --> 0:13:59.400 private key, however, is what allows anyone to put their 0:13:59.440 --> 0:14:03.920 hands in your cookie jar. So stick the nubs into 0:14:04.040 --> 0:14:07.079 your wallet and snatch your cryptough you don't want that. 0:14:07.520 --> 0:14:11.440 Your private key is something you should never share. There's 0:14:11.480 --> 0:14:16.120 no reason any reputable transaction on the blockchain requires you 0:14:16.160 --> 0:14:20.200 to share your private key. Any transaction you may engage 0:14:20.280 --> 0:14:24.480 and should only require your public key. Think of it 0:14:24.520 --> 0:14:28.160 as your token or ticket into the door or one 0:14:28.720 --> 0:14:31.320 the one way door that allows money to you put 0:14:31.400 --> 0:14:35.520 into your wallet. But by providing your private key to others, 0:14:35.600 --> 0:14:39.200 you allow their unfettered access into your chips. You don't 0:14:39.200 --> 0:14:43.800 want that. Typically, the private key is another set of 0:14:44.120 --> 0:14:49.880 alpha numeric characters, and you unlock access to those characters, 0:14:50.440 --> 0:14:53.960 which really don't do often what should you like to 0:14:55.200 --> 0:14:59.760 These wallets give you a recovery phrase. So I'm gonna 0:14:59.800 --> 0:15:02.800 dig into a cold wallet that I use really quickly. 0:15:03.280 --> 0:15:06.960 Cold means it's hardware. It's like not on the internet. Um, 0:15:07.000 --> 0:15:09.520 it's a it's a device, you know. Most of them 0:15:09.560 --> 0:15:12.600 look like a USB like little thumb drive. And so 0:15:13.000 --> 0:15:15.200 Ledger is the one that I use, a Ledger nano 0:15:15.520 --> 0:15:18.520 x UM it's a cold wallet. More on that soon. 0:15:19.000 --> 0:15:24.720 But they provide a recovery phrase which I have stored, 0:15:25.440 --> 0:15:29.720 and once I enter that recovery phrase, it unlocks my 0:15:29.840 --> 0:15:33.840 private keat again. Without that recovery phrase, I have no 0:15:34.040 --> 0:15:38.680 access to my crypto, no reputable wallet again, hot or 0:15:38.800 --> 0:15:43.600 cold should be storing my recovery phrase. In fact, when 0:15:43.640 --> 0:15:45.960 I signed up for Ledger, they give you a couple 0:15:46.080 --> 0:15:49.560 like pieces of paper, a couple of cards like physical 0:15:49.600 --> 0:15:53.480 pieces of paper that I can copy down with a 0:15:53.560 --> 0:15:56.880 pen my recovery phrase and store it in a safe 0:15:56.880 --> 0:16:00.680 place like whise choices, maybe a safe deposit box or 0:16:00.760 --> 0:16:03.960 a fireproof box or in your gun safe or whatever. 0:16:04.480 --> 0:16:09.160 And so your private key is protected by a recovery 0:16:09.200 --> 0:16:15.560 phrase that are typically like words like these random words' 0:16:15.640 --> 0:16:17.920 alleg you gives you twenty four words that are that 0:16:17.960 --> 0:16:20.880 are in your recovery phrase, and they're like super super 0:16:21.200 --> 0:16:28.080 random words like have house chair bright like these they're 0:16:28.080 --> 0:16:31.920 just random words or they seem random words that don't 0:16:31.920 --> 0:16:35.920 make any sense other otherwise. But they are the recovery 0:16:35.960 --> 0:16:42.080 phrase that is used to unlock your private key. So 0:16:42.120 --> 0:16:45.360 there are types of wallets that I want to discuss. UM. 0:16:45.400 --> 0:16:49.800 There are three types that are most prominent, or really 0:16:49.920 --> 0:16:52.520 there's three types. I should say that you should be 0:16:52.560 --> 0:16:56.280 familiar with UM though you'll find I'm sure your groove 0:16:56.680 --> 0:16:59.560 with probably one, maybe two of them, but I'm sure 0:16:59.560 --> 0:17:03.480 you'll find one that you probably prefer first up. UM. 0:17:03.560 --> 0:17:06.800 I would say it's probably lesser used, but that's speculation 0:17:06.840 --> 0:17:11.680 because it's just harder to do it. It's it's paper wallet. 0:17:11.720 --> 0:17:17.720 It's a paper wallet. As I mentioned before, your crypto, 0:17:18.320 --> 0:17:20.560 your wallet, I'm sorry, it's just like a set of 0:17:20.760 --> 0:17:24.720 alpha numeric characters that are your private key that unlock 0:17:24.760 --> 0:17:28.680 your crypto. So a paper wallet is a sheet of 0:17:28.720 --> 0:17:34.920 paper that you write down your characters, and using those characters, 0:17:35.119 --> 0:17:39.240 you can unlock your assets. It's clunky this way, but 0:17:39.400 --> 0:17:41.879 it's legitimate. You just need a sheet of paper that 0:17:41.960 --> 0:17:44.760 has you can you can you can memorize them, you know, 0:17:44.840 --> 0:17:47.399 if you want it. But it's a piece of paper. 0:17:47.840 --> 0:17:53.520 A paper wallet, it is that UM records the characters 0:17:53.560 --> 0:17:59.880 of your private key. Paper wallet UM more common because 0:18:00.000 --> 0:18:03.760 it is easier, is an online wallet. These are things 0:18:03.800 --> 0:18:06.679 like the coin based wallet, which I have. I have 0:18:06.880 --> 0:18:09.720 one UM, I don't use it as much anymore UM, 0:18:09.840 --> 0:18:13.760 which will discuss my reasons why. But a coin based wallet, 0:18:13.920 --> 0:18:17.200 and there are others. UM is software. It's an app 0:18:17.760 --> 0:18:22.520 that is typically protected by like a two step encryption UM. 0:18:22.560 --> 0:18:24.800 So it's likely gonna need like it's gonna send you 0:18:24.840 --> 0:18:26.879 a text when you're trying to sign in, or it's 0:18:26.880 --> 0:18:32.120 gonna require something like Google Authenticator UM that code when 0:18:32.200 --> 0:18:35.840 you try to sign in. But with your online wallet, 0:18:36.600 --> 0:18:40.040 they're largely easy to use, which makes them attractive to 0:18:40.119 --> 0:18:43.560 many because for people who are looking for simplicity and 0:18:43.600 --> 0:18:46.760 don't want to have all the responsibility of meaning maintaining 0:18:46.760 --> 0:18:49.840 a small device, like a hardware wallet, it typically is 0:18:50.600 --> 0:18:55.640 keeping it safe and remembers location. UH. A hot wallet, 0:18:56.240 --> 0:19:01.600 which is the software wallet UM is attractive, which brings 0:19:01.600 --> 0:19:05.280 me to the hardware wallet UM. The this is called 0:19:05.280 --> 0:19:08.879 a cold wallet UM. A hot wallet again is the 0:19:08.920 --> 0:19:12.280 software the app that does it. The cold wallet is 0:19:12.359 --> 0:19:16.040 hardware UM. Again, I use ledger. I have a nano 0:19:16.359 --> 0:19:20.879 x is by ledger. UM is a wallet that is 0:19:20.920 --> 0:19:24.680 not connected to the internet unless I plug it in. UM. 0:19:24.720 --> 0:19:29.600 But it's it's storing my keys offline. It's stored my 0:19:29.720 --> 0:19:34.160 keys are stored on the device. It's safer UM, provided 0:19:34.200 --> 0:19:38.320 I don't lose it. UM. But it does require me 0:19:39.000 --> 0:19:43.800 to be incredibly more responsible. Is that all it makes sense? 0:19:43.880 --> 0:19:48.320 I hope it does. Cold wallet is hardware. It's offline. 0:19:48.600 --> 0:19:50.919 It's not online, you know, unless I plug it in. 0:19:51.720 --> 0:19:56.360 A hot wallet software which is like coin based wallet. 0:19:56.760 --> 0:19:59.360 And there are many many others UM, but they are 0:19:59.720 --> 0:20:05.240 on line, and there are third parties managing your crypto, 0:20:06.000 --> 0:20:10.879 managing your keys. They both have their own bit of attractiveness. 0:20:11.000 --> 0:20:12.600 If you are if you do not want to be 0:20:12.680 --> 0:20:17.920 responsible for knowing where your device is, knowing where your 0:20:17.960 --> 0:20:20.760 that paper is, knowing where that little thumb drive that 0:20:20.800 --> 0:20:24.399 we call a that I call a ledger in my 0:20:24.400 --> 0:20:28.119 my my respects a nano x or other device that 0:20:28.200 --> 0:20:30.080 you use. If you don't want to be responsible for that, 0:20:30.240 --> 0:20:32.680 something like a coin based wallet might work for you, 0:20:33.520 --> 0:20:37.000 Which brings me to UM. The topic of a const 0:20:37.119 --> 0:20:41.439 custodio or non custodiol at this stage because they have 0:20:41.720 --> 0:20:45.879 so many implications too. Hot or cold wallets, hardware or 0:20:45.920 --> 0:20:50.560 software wallets, UM, custodio and non custodio. It makes sense 0:20:50.600 --> 0:20:54.119 to discuss those now because the definitions go hand in 0:20:54.160 --> 0:20:59.639 hand with the wallet types. Custodio wallets are like software. 0:20:59.720 --> 0:21:05.280 Those are the wallets that we are trusting knowingly or 0:21:05.359 --> 0:21:10.280 unknowingly a third party like coin base or some other 0:21:10.359 --> 0:21:15.840 company to manage our crypto with a custodia wallet, while 0:21:15.880 --> 0:21:20.120 it might be encrypted, it's throwed on somebody's server somewhere 0:21:20.200 --> 0:21:23.960 like maybe AWS, or maybe that company has their own 0:21:24.000 --> 0:21:28.960 server farm. But in any case, somebody else, the custodian 0:21:29.880 --> 0:21:35.280 is managing their holding tight to our private keys. The 0:21:35.320 --> 0:21:39.520 benefits of this custodian wallet is just what we discussed convenience, 0:21:40.320 --> 0:21:43.399 playing simple. They're a lot easier to use. They're built 0:21:43.440 --> 0:21:46.280 for the lowest common denominator. Not to say that cold 0:21:46.280 --> 0:21:49.159 wallets are not built for the lowest common denominators, but 0:21:49.640 --> 0:21:53.399 they are custodial that they're somewhere we get to hold 0:21:53.440 --> 0:21:56.640 somebody's hand when we crossed the street. All right, so 0:21:56.920 --> 0:22:00.360 beautifully designed, um, but we don't have to a lot 0:22:00.359 --> 0:22:04.320 of responsibility to get to point B from where we 0:22:04.359 --> 0:22:08.720 are in point eight. But God forbid that coin base 0:22:08.800 --> 0:22:13.600 gets hacked, because that means you are susceptible, and whatever 0:22:13.960 --> 0:22:16.160 you know, coins I have left in my coin base 0:22:16.320 --> 0:22:20.439 is susceptible. So I don't leave my crypto in my 0:22:20.520 --> 0:22:24.679 coin base app. I choose to be responsible, So I 0:22:24.760 --> 0:22:28.359 choose to go the non custodial route, which means that 0:22:28.400 --> 0:22:32.400 I am fully grown, no longer holding anyone's hand when 0:22:32.400 --> 0:22:36.040 I crossed the street. I am taking full ownership of 0:22:36.080 --> 0:22:40.080 my future. In Web three, my data isn't stored on 0:22:40.240 --> 0:22:46.600 some company servers. The only records present of my private 0:22:46.680 --> 0:22:50.880 keys are you know the record actually the only records 0:22:50.920 --> 0:22:54.760 present about anything about my activity or or either on 0:22:54.800 --> 0:22:58.199 the blockchain or on my device. There is no like 0:22:58.359 --> 0:23:03.800 online service hold onto will Lucas data. I own it. 0:23:03.800 --> 0:23:06.120 It's in my It's right now, sitting right in front 0:23:06.160 --> 0:23:11.639 of me. And whoever records whatever records I keep on 0:23:11.760 --> 0:23:14.960 my person or in my house, let that be my 0:23:15.040 --> 0:23:20.680 private keys or whatever. There is no authority or company 0:23:20.800 --> 0:23:24.000 or app holding onto it but me. I own it 0:23:24.080 --> 0:23:31.640 fully and outright, both the benefits and the responsibility Lastly, UM, 0:23:31.680 --> 0:23:35.120 as we've talked a lot about coin base and Ledger 0:23:35.280 --> 0:23:37.480 in this episode, I want to take a final few 0:23:37.520 --> 0:23:41.520 minutes here and set the record clear about the differences 0:23:41.640 --> 0:23:46.720 between an exchange and a wallet. Um. In most in 0:23:46.720 --> 0:23:52.399 the most basic terms, a crypto exchange is like you 0:23:52.480 --> 0:23:54.920 ever been in the airport and next to like Chick 0:23:54.960 --> 0:23:59.000 fil a, they have a counter where you can exchange 0:23:59.119 --> 0:24:03.919 your euro for US dollars or exchange your U S 0:24:04.040 --> 0:24:09.280 dollars for renman. B Um, it's an exchange desk, and 0:24:09.320 --> 0:24:11.719 there's an exchange rate. And so I'm gonna make this 0:24:11.840 --> 0:24:15.000 up because I could look. But unless it's a matter 0:24:15.000 --> 0:24:18.040 of fact, let's let's do the real work here and 0:24:18.119 --> 0:24:27.600 find exchange rate from U S d to Euro Boom okay, 0:24:27.680 --> 0:24:31.879 So for one U S dollar I can get eighty 0:24:31.960 --> 0:24:37.720 nine cents in euros Okay, one one dollar equals eighty 0:24:37.840 --> 0:24:42.320 nine cents in Europe. So it kind of works the same, 0:24:42.560 --> 0:24:45.320 well it does. It works the same way, So one 0:24:45.359 --> 0:24:50.240 dollar one type the same one U S dollar to 0:24:50.840 --> 0:24:58.800 one So for one dollar, well not much. Let's just 0:24:58.800 --> 0:25:01.919 do it backwards. If I want one, if I have 0:25:01.960 --> 0:25:07.520 to pay two thousand, eight hundred dollars as of right now. Okay, 0:25:08.480 --> 0:25:10.159 let's did it backwards, because it's going to be like 0:25:10.280 --> 0:25:12.359 points years years, years, years, ARLs or something if I 0:25:12.400 --> 0:25:14.280 do it the other way. You guys are pretty good 0:25:14.280 --> 0:25:19.840 at math. So for one for two thousand eight dollars, 0:25:19.880 --> 0:25:23.760 I can buy one at president value that is the 0:25:23.880 --> 0:25:28.120 exchange rate, and so on an exchange, I can trade 0:25:28.760 --> 0:25:33.119 my US dollars for ethereum, or for a bitcoin, or 0:25:33.160 --> 0:25:37.680 for dose or for shiba. And exchange is not a wallet. 0:25:38.080 --> 0:25:42.440 But in this case, like coin base, a company who 0:25:42.480 --> 0:25:46.879 develops an exchange can also develop a wallet. They they 0:25:46.920 --> 0:25:50.440 are mutually exclusive, but they don't have to be. The 0:25:50.640 --> 0:25:52.520 coin Base could have just said we're gonna think in 0:25:52.520 --> 0:25:54.800 the exchange game, we're not gonna do a wallet, but 0:25:54.840 --> 0:25:58.199 they decided to play in the wallet game too. I 0:25:58.240 --> 0:26:00.919 mentioned that I also have a coin based wallet, So 0:26:01.000 --> 0:26:04.439 that wallet, whether or not it's developed by coin based, 0:26:04.560 --> 0:26:07.200 is software or hardware. In the case of my ledger 0:26:07.720 --> 0:26:11.040 that allows me to store my coins. I can make 0:26:11.080 --> 0:26:15.560 transactions using my wallet. I cannot make transactions with dollars 0:26:15.560 --> 0:26:18.639 that are stored on the exchange. The exchange is just 0:26:18.680 --> 0:26:20.720 where I'm playing the money game. I'm going back and 0:26:20.760 --> 0:26:24.760 forth exchanging my dollars from our bitcoin or from more ethereum, retcetera. 0:26:25.119 --> 0:26:26.800 But if I want to go buy a cup of 0:26:26.800 --> 0:26:31.439 coffee at some you know, cool, you know coffeehouse, I 0:26:31.520 --> 0:26:34.879