Wallets & Private Keys

What is a Crypto Wallet?

A crypto wallet doesn't actually "store" your cryptocurrency. Your tokens live on the blockchain. A wallet stores the private keys that prove you own those tokens and allow you to send them.

Think of it like this:

The blockchain is the bank's ledger
Your wallet address is your account number (public — safe to share)
Your private key is your signature/PIN (secret — never share)

Private Keys

A private key is a long string of random characters that gives complete control over the funds associated with it. Anyone with your private key can spend your tokens.

Never share your private keys with anyone. No legitimate service will ever ask for them. If someone asks for your private key, it's a scam.

Recovery Phrases (Mnemonic)

Managing individual private keys for every blockchain would be impractical. Instead, modern wallets use a recovery phrase (also called a seed phrase or mnemonic) — typically 12 or 24 words.

This single phrase can derive private keys for every blockchain. One phrase = one wallet = addresses on all chains.

Example recovery phrase (do NOT use this):

apple banana cherry dragon eagle frost grape honey iris jewel kite lemon

Why Recovery Phrases Matter

One phrase controls everything — all your addresses on all chains are derived from it
Loss = permanent loss — if you lose your recovery phrase and can't access your wallet, your funds are gone forever
No recovery service — unlike a bank, there's no customer support that can reset your access

How to Store Your Recovery Phrase

| Do | Don't | |----|-------| | Write it on paper | Store it in a screenshot | | Keep it in a fireproof safe | Save it in a notes app | | Consider a metal backup plate | Email it to yourself | | Store copies in separate locations | Store it in cloud storage | | | Share it with anyone |

Swaptain generates a 12-word recovery phrase when you create a wallet. The bot displays it once and then automatically deletes the message. Write it down immediately.

Types of Wallets

Hot Wallets

Connected to the internet. Convenient for active trading but more exposed to online threats.

Examples: MetaMask, Trust Wallet, Swaptain's built-in wallet
Best for: Active trading, smaller amounts

Cold Wallets (Hardware Wallets)

Offline devices that store your keys. More secure but less convenient.

Examples: Ledger, Trezor
Best for: Long-term storage, large amounts

Custodial Wallets

A third party (usually an exchange) holds your keys. You don't control the private keys.

Examples: Coinbase, Binance account wallets
Best for: Beginners (but you're trusting the custodian)

How Swaptain Handles Your Wallet

Swaptain creates a wallet that supports all connected chains from a single recovery phrase. Your wallet's mnemonic is encrypted with AES-256-GCM using a password you set:

You set the password — Swaptain never stores it
Encrypted at rest — your keys are always stored encrypted
You can export — private keys for any chain are exportable via the bot
You can import — bring your existing recovery phrase into Swaptain

Multi-Chain Addresses

One recovery phrase generates addresses for every supported chain. This is possible through key derivation — a standardised process (BIP39/BIP44) that turns your mnemonic into chain-specific private keys.

This is why Swaptain can give you a Bitcoin address, an Ethereum address, a Cosmos address, and more — all from the same wallet.

Different chains have different address formats. Your Bitcoin address looks different from your Ethereum address, but they're both derived from the same recovery phrase.