Authentication

Authentication, at a basic level, is a security process that verifies your identity or login credentials before giving you access to resources, whether that be a blockchain network, a cryptocurrency exchange account, or a personal cryptocurrency wallet.

Almost every service or app that we use that’s connected to the Internet requires you to log into that service or app before you get to personalized service or access to your account data.

Cryptocurrency services and apps are no different.

Two-factor authentication, for example, is a type of authentication offered by all cryptocurrency exchanges that requires two different methods of user identification before an account holder is given access to her account.

During login or registration, this might include requiring both a username + password combination AND an SMS-based code sent to the account holder’s mobile phone, which all need to be provided at the same time or access isn’t granted.

Many online services now support software-based authentication apps like Google Authenticator that run on your smartphone or tablet that provide you a 6-digit one-time password that must be entered with your username and password during login.

Crypto-related apps and services have also evolved to offer this enhanced form of two-factor authentication.

Related Terms

Desktop Wallet

A common type of crypto wallet used to securely store and manage your private keys on a computer hard drive. They’re considered more secure than web-based wallets, since you can only access them from wherever your computer is located, and again, you control your private keys.

Ethereum (ETH)

Ethereum is a decentralized blockchain platform that makes digital money, global payments, and applications possible using open-source software and smart contract functionality. The big difference between the two is that Ethereum is programmable, meaning you can build and use decentralized apps on the network. That means the Ethereum blockchain can be programmed to do virtually anything.

Software Wallet

A form of cryptocurrency wallet that’s based on software, so installed as a mobile app or accessed via a website, or installed as software on a desktop or laptop computer. The software itself stores your private keys that are used to access your cryptocurrency funds.

QR Code

A type of barcode used by centralized cryptocurrency exchanges (CEX) and other crypto-related services for security purposes that aid in various user account tasks, like login, API key creation, or 2-factor verification.

Non-Custodial Wallet

Also referred to as a self-custodial wallet, puts the responsibility of storing your wallet keys in your hands. Non-custodial wallets come in different variations, including web-based, software installed on a smartphone or computer, a hardware device like a USB thumb drive, or even paper.