Where Are My “Private keys?”

Your private keys are in a cryptocurrency wallet, which is typically mobile or desktop software or a specialized hardware device. Your private keys are not on the cryptocurrency blockchain network. If you keep cryptocurrency on an exchange, then the exchange is the custodian of your private keys; you’re trusting it with your keys in the same way you’d trust a bank’s vault to hold your gold.

If you transfer your cryptocurrency from an exchange to a non-custodial, then you are in control of your keys. Because of the configuration and functionality of cryptocurrency wallets, you’ll likely never handle the private keys directly as wallets generally manage them for you automatically. Typically, you’re given a seed phrase that encodes your private keys as a backup.

Public and private keys Control Your Crypto

How public and private keys work together is fundamental to understanding how cryptocurrency transactions function. When you say you have cryptocurrency, what you’re really saying is you have a private key that proves ownership of that cryptocurrency. Since it’s stored on the blockchain, anyone can verify you as the owner with your public key.

The choice of “holding your own keys” or trusting a custodian depends on your philosophy, risk tolerance, and a host of other factors. If you hold your own private keys, consider modern HD wallets, which can do a great job of managing your private keys, and remember to never share them. If you choose a custodial solution like an exchange, make sure you choose a trusted, reputable company that places a high emphasis on security and regulation.