A wallet is software or a device that stores a user's private cryptographic keys and lets them interact with a blockchain: receive and send crypto assets, sign transactions, connect to decentralized applications.
The wallet does not hold the assets themselves, which remain recorded on the blockchain: it holds the keys that prove ownership. There are:
- hot wallets, software connected to the Internet (MetaMask, Rabby, Phantom), convenient for daily use;
- cold wallets, physical devices that keep keys offline (Ledger, Trezor), safer for large amounts;
- smart wallets, programmable wallets (account abstraction) that allow account recovery, multiple signatures or fees paid by a third party.
Losing one's recovery phrase (seed phrase) means permanently losing access to one's assets.
Why it matters when hiring
Building a wallet means combining applied cryptography, mobile or hardware security and consumer user experience. These profiles are rare. Ask the candidate how they protect keys on the client side and how they handled account recovery. A Web3 developer who has only connected MetaMask to an interface does not have the experience of a developer who designed a wallet.