Let’s start with some basic definitions.
Mnemonic Phrase is a set of words, in a specific order, usually 12 common words, used as an easy to read backup “password” for a blockchain account. Example: monkey face ocean airplane sidewalk bench paper house tray drink knee sandal
Private Key is a long string of letters and numbers that is used to sign a message or a transaction before it is submitted to a blockchain.
Public Key is a long string of letters and numbers that is used as the public address to send cryptocurrency to.
Here is what happens when a new blockchain wallet is created.
A mnemonic phrase is generated and used to generate a primary private key.
The primary public key is used to create child accounts.
The child accounts consist of a public key (address) and a private key.
The public address is what you give to people to send crypto to you.
You can think of a public address like the address to your house and the private key like the key to your front door.
You often give out your home address to people, but you don’t go advertising the imprint pattern of your house key. If you did people go make a key and use it to get in to your house.
An account can be recovered (restored or loaded on to) in a crypto wallet with either the mnemonic phrase or the primary public key.
Important Fact: You are never tied to any one wallet app or provider. As long as you have your private key, you can recover (import) your blockchain account on another wallet app.
When you send someone Ether (or some other cryptocurrency), your wallet provider creates a transaction and submits it to the blockchain.
The transaction is created by using your private key to “sign” the transaction. This provides cryptographic proof that you own the account your are sending the Ether from.
A crypto wallet is simply these two things: 1. a window in to your blockchain account, and 2. a service that creates and sends transactions to the blockchain for you.
Try it! Go to MyEtherWallet, create an account. Now export your mnemonic phrase or private key. Now go to Blockchain.com, create an account, and import your blockchain account using the private key you copied down. Increase the fun in this exercise by sending some ETH to your account before you import it to the second wallet app. If you have ETH in your account, then when you import it to the new wallet you should see the exact same balance.
Extra Credit: You can “watch” your account independent from a wallet app by going to Etherscan.io, paste in your wallet address (public address) in the top search bar.
Important: You are responsible for your own mnemonic phrase and private keys. Never share these with anyone.
If this was helpful, give me some claps and share! And reach out js (at) stauffer.co or @jaredstauffer on Twitter. You can also send me ETH or DAI to thankjared.xyz (0xB10975FF2aC535B2516816B480456bf48B0AFB6A).