What is a Wallet Address? (Beginner’s Guide 2024)

In this guide, we’ll walk through everything you need to know about cryptocurrency wallet addresses — including how they work, how you can create one, and how you can find your wallet address on your crypto wallets and exchanges! 

What is a wallet address in crypto? 

A cryptocurrency wallet address is like an email address for your crypto transactions. 

Your wallet address is a unique string of letters and numbers that can be used to send and receive cryptocurrency to and from your wallet. They typically look something like this: 

1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa

Just as you would share your email address to others to communicate, your wallet address is what you share to receive cryptocurrencies like Bitcoin and Ethereum. Hackers won’t be able to hack your wallet just from knowing your address.

How do I create a wallet address? 

Creating a wallet address is a straightforward process (and completely free when you use services like MetaMask and Coinbase Wallet):

Step 1: Choose a reputable cryptocurrency wallet application or hardware wallet.

Step 2: Follow the setup instructions, which typically involve creating a new wallet. 

Step 3: Once your wallet is set up, it will automatically generate a wallet address for you.

Some providers allow you to create multiple addresses within the same wallet for increased privacy.

How do I find my wallet address? 

Let’s take a look at how you can find your wallet address on one of the world’s most popular exchanges — Coinbase. Remember, the exact steps may vary depending on the exact platform you are using. 

1. Log in to your Coinbase account. 
2. Click the button labeled ‘Transfer’. 

3. Click the button labeled ‘Receive Crypto’.

4. Now, you’ll see a wallet address as well as a scannable QR code. Here, you can toggle between different wallet addresses for different blockchains. 

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You can follow similar steps to find your wallet address on most wallets/exchanges. 

Remember, if your exchange/wallet supports multiple blockchains, you’ll have a different wallet address for each blockchain. Be sure to pick the correct wallet address for your transaction. 

Safety tips for wallet addresses

Let’s walk through a few safety tips for wallet addresses. 

1. Always double check wallet addresses: Before you make a transaction, you should double check that you have the correct wallet address. If there is a typo, you may not be able to recover your funds. 
2. Keep your private keys safe: While it’s okay to share your wallet address, you should never share your private keys. If you get contacted by someone who asks for your private keys, it’s likely you’re dealing with a scammer. ‍
3. Use whitelisted addresses: Some wallets and exchanges allow you to whitelist trusted wallet addresses. This prevents accidental transactions to incorrect addresses.

How do wallet addresses work? 

Crypto transactions are designed to be pseudo-anonymous and transparent. Wallet addresses are used to verify senders and recipients. 

When someone sends cryptocurrency to your wallet address, the transaction is recorded and verified on the blockchain — with a publicly visible record of the transaction and the wallet addresses of both parties. 

Some blockchains — like Bitcoin and Cardano — generate a new wallet address for each new transaction for increased privacy. 

Other blockchains — like Ethereum — don’t have changing wallet addresses.

Can my wallet address be tracked? 

Blockchain explorers like Etherscan and SolScan allow anyone to track transactions related to certain wallet addresses. 

There is no way to ‘opt out’ of blockchain explorers. Remember, cryptocurrency was designed to be transparent. 

If you’re looking to track your own wallets and exchanges, consider using a free crypto portfolio tracker like CoinLedger. The platform can automatically connect to your cryptocurrency platforms to give a complete view of your gains and losses.

Why do cryptocurrencies like Bitcoin use a two-key system?

Cryptocurrencies use a two-key system, comprising a public key (which evolves into your wallet address) and a private key, for enhanced security. 

Public key: A public key is derived from your wallet address. It’s comparable to your bank account number and can be freely shared with others. 

Private key: A private key is used to access your cryptocurrency and approve transactions. You should not share your private keys with others, because it will give them access to your crypto wallet and its holdings. 

What’s the difference between wallets, keys, and addresses? 

Let’s walk through the differences between your wallet, your keys, and your wallet address. 

• Wallet: A digital tool that stores your keys and addresses, acting as a secure means to access and manage your cryptocurrencies.
• Keys: Your wallet has public and private keys. 
  • The public key is like your bank account number — it can be shared with others without compromising your security! 
  • The private key is like your bank account PIN — it can be used to access your holdings, so you should keep it secret and in a safe place. 
• Wallet address: A wallet address is a shortened version of your public key. Your wallet address can be shared with others to allow you to easily send and receive your cryptocurrencies. 

Is there any way I can create a short, customizable wallet address? 

Because crypto addresses can be difficult to memorize, some crypto wallets/services give the option to create a short, customizable wallet address.

• Unstoppable Domains 
• Ethereum Naming Service (for Ethereum wallet addresses) ‍
• Coinbase Wallet (for Coinbase Wallet users)

What do I need to access a wallet address? 

Popular wallet providers like MetaMask typically require you to enter your password to access your wallet. 

If you’ve forgotten your password, you’ll need to use your seed phrase that you received during the wallet creation process to re-access your account.

Is my crypto wallet address anonymous? 

Technically, your cryptocurrency wallet is anonymous. However, it’s important to note that there are methods that can be used to identify ‘anonymous’ wallets. 

Remember, transactions on blockchains like Bitcoin and Ethereum are publicly visible. In the past, contractors like Chainalysis have worked with the IRS to match blockchain transactions to known individuals. 

Are there tax implications for wallet addresses? 

Crypto transactions on your crypto wallet — including trades, sales, and swaps — may be subject to income tax and capital gains tax. You are required to report these transactions on your taxes. 

You can use blockchain explorers or an excel spreadsheet to manually track your taxes. However, this requires time and effort. 

One alternative is to use crypto tax software like CoinLedger. Just enter your wallet address from blockchains like Ethereum, Solana, and Bitcoin, and CoinLedger will automatically generate your tax forms with the click of a button!