Bitcoin Forum

Hi everyone,

Newbie here. Was reading about wallets. I am completely new. The friend who introduced me to crypto said need to know how and where to store funds is the first think I should know so started with wallets.

Coming to my query:
I read that there are two types of wallets First deterministic wallet and the other is non deterministic wallet. It was said that deterministic wallets are best. How would a user like me(newbie) know which is deterministic and which is not?

Also, read that Trezor and Ledger are hardware(offline wallets) which are deterministic as well. But, in the initial stage of investment I do not want to invest much on wallets.

There are many people here who know about crypto and blockchain since ages please advice. If there is something that I can read and understand please do share I am ready to read or put efforts to understand things.

If you haven't already, read this: https://en.bitcoin.it/wiki/Deterministic_wallet

And to answer your question, I'm honestly not aware of any wallet that doesn't this. There used to be some in the past, but they all upgraded. In most cases, those that don't have or don't ask you to save a seed don't use this system.

A hardware wallet is highly suggested and it's really a good investment. If you're planning to store anything above 500$, go buy it without thinking twice. You won't regret it. If you still don't want to buy one, I suggest going with Electrum wallet for Desktop or Mycelium for the phone.

Clue number 4 is the best, at least to my mind. All (private key:public key) pairs are derived from one master key pair. That is what an HD wallet is by definition. By contrast, the nondeterministic wallet contains random pairs of private and public keys, and hence it cannot have a master key.

it is worth adding that these may not cover all cases and it may not be true in all cases either.
for example bitcoin core is a deterministic wallet but it does not use mnemonic so there is no 12/24/... words to back up, only a seed that the user won't see in GUI. (i think point 3 is the only thing that works in this case)
or some web wallets like Blockchain.info used to have a "recovery phrase" while they weren't deterministic at the time. it looked like a mnemonic but it was for something entirely different.

I agree this is one way of verifying and even the 3 point I felt very worth while as I could check before Signup or buying whether it is HD or not. @ETFbitcoin Thanks a lot.

I do not know much just in learning stage so, clearing my doubt. Blockchain.info was a non deterministic and I read that passphrase also introduce risk of loss when both of these disadvantage are there in Blockchian.info why were or are users using it. Does it have some positive side as well?

Sorry, if I have miss understood.

Are you asking why people use Blockchain.info? It’s used by users who don’t know much and prefer a simple web interface (that can be accessed anywhere) at the cost of the most security other wallets may offer.

please note that non-HD wallets aren't unsafe, it is just that HD wallets are safer because you only have to rely on your RNG once when you create the seed. but with non-HD wallets each time you want to create a new private key, you have to call the RNG again and that is not desirable.
as for why people use it, as TryNinja said it is for convenience and lack of knowledge.

BTW OP, you should also know what type of crypto you would like to store in your wallet as per advise since you are to cryptocurrency then it is better to join first an exchange. You can get an exchange wallet under your account and you can choose different kinds of crypto to store when you buy it. Each crypto has its design wallet and it will depend on its platform being used. The most common wallet is ERC20 for ethereum platform and block chain.

So start first buying a crypto in an exchange wallet. Store it or even try to trade in smaller amounts. Thus, you can practice and widened your knowledge about cryptocurrency. This is where I started to learn also.