It was entirely in my power to buy a Bitcoin or two back in 2017, but I hand-waved and chose not to bother. The biggest reason I didn't do it?

I did not feel like learning how to use a wallet.

Sometimes I still shake my head at this.

As this wave of DeFi and NFTs washes over the digital economy, I do not want to be the one who missed it because I was too intimidated by the technology. And I do not want you to be that person either.

So here is Part 1 of the foundational knowledge which makes me comfortable putting my money into digital assets.

Wallets are the entry point into crypto

This is one of the most important things we should know, front-to-back. We should know this so well that we can explain it in a different language.

A wallet generates your public + private keys from a "seed"

• Public keys: the blockchain address where people can send you funds, and view your transaction history.

• Private keys: the cryptographic hash (just 64 character strings like below) which you use to sign transactions being moved out of your public address.

  0x63e2C9a3Db9fFd3cC108f08EAd601966EA031f5C

• Seed phrase: 12 or 24 words which are used to "seed" the encryption function that will generate your private keys.

• Different seed = different set of public + private keys.

• The seed phrase is encrypted to generate the private keys. The private keys are then also encrypted, to generate your public keys. In this way, no one can ever derive your private keys from your public address (without a quantum computer anyways)

Funds can only be moved out of your public address when you sign with your private key

• In order to authorize a transaction from your public address, you must supply the correct private key.

• This means your private key = PRICELESS. It has to be kept safe.

• This is where the type of wallet you use becomes important (more on that in part 2). Some wallets can store your keys on an offline device (hardware wallets), while others can store your keys in your web browser (Metamask).

Why your seed phrase is so important

• Since your keys are generated from your passphrase, if you ever lose them for some reason, they can be re-generated from your seed phrase!

• Many people engrave their phrase on small sheets of metal (so they can hold up in a fire) and store them in various locations (sometimes in pieces so no one can ever find the entire thing).

• It may seem excessive, but if you have any estimable sum of money in crypto, you will protect it. YOU are autonomous with your money, so YOU are 100% responsible for it.

Stay tuned for part 2: an explanation of hot vs. cold wallets, and how to use them securely and keep your assets safe.