For anyone looking to enter the world of DeFi, the most important tool is a web3 wallet, which can store funds and interact with the Ethereum blockchain.

Some of the most popular web3 wallets include:

Open-source browser extension wallets for Chrome and Firefox: MetaMask

Mobile wallet apps: Coinbase Wallet, imToken, Huobi Wallet

Hardware cold wallets: Ledger, Trezor

After choosing a wallet, the next step is to create a wallet address. Here are some basic concepts you need to understand:

Wallet Address

A wallet address functions similarly to a bank card number. If someone knows your wallet address or you know theirs, you can transfer the corresponding digital currency. An Ethereum wallet address is a string of numbers and letters starting with "0x."

Public Key and Private Key

Public and private keys come in pairs—one is used for encryption, and the other for decryption. The ciphertext generated by encrypting plaintext with one key can only be decrypted using the corresponding other key. The private key can mathematically derive the public key, while the wallet address is the hash value of the public key.

If a wallet address can be compared to a bank card number, then the private key can be thought of as the bank card password. In the world of digital currencies, the public key represents "identity," while the private key represents "ownership."

Recovery Phrase (Seed Phrase)

A recovery phrase is another representation of the plaintext private key, designed to help users remember the complex private key (a 64-bit hash value). Recovery phrases typically consist of 12, 15, 18, or 21 words, all selected from a fixed vocabulary and generated in a specific order according to an algorithm.

When creating a wallet address, be sure to back up your recovery phrase, as it is the only credential proving your control over the assets. Here are three suggestions for backing up and safeguarding your recovery phrase:

1. Use physical media for backup whenever possible, such as writing it down on paper. Avoid taking screenshots or photos and storing them on internet-connected devices.

2. Verify the backed-up recovery phrase multiple times to ensure accuracy. If even one word is copied incorrectly, it could cause significant difficulties in recovering the correct phrase later.

3. Store the backed-up recovery phrase securely, taking measures to prevent theft or loss. Do not share it with anyone.