How to use Cardano Wallet

A step by step guide.

How to use Cardano wallet

A Cardano wallet is something like a bank account. The difference is that you do not need a permit to install the wallet. You just do it and you are ready to use ADA coins. We do not want to talk about the whole cryptography behind Cardano wallets since it is a complex topic. All you need to know at the moment is that a wallet asks you for rewriting a bunch of words called seed or passphrase. It is the most important thing you need to protect. Write the words on a piece of paper and carefully store the paper. You can do it twice if you want to have a copy. Never write the words somewhere into a text file. The words cannot be stored in a digital form.

Why is the passphrase so important? Well, it allows you to recover a wallet in case it is destroyed. Your computer might not start-up one day or you pour water on it. You can accidentally lose your hardware wallet or it might stop working. In all these cases, you can just install a desktop wallet or buy a new hardware wallet and recover your old wallet via the passphrase.

When somebody writes to you and asks you for providing the passphrase then it is a scam. A scammer can pretend that he or she is a hardware wallet vendor or a member of the Cardano team. Remember, that nobody in the world has a reason to ask you for your passphrase. If it happens then it is a scam. The scammer just restores your wallet and steal your coins. Only you should be able to restore your wallet. Do not send the passphrase via email to anybody. Do not write it somewhere on the internet.

We hope that you understand how important the passphrase is. Let’s assume that you have created a new wallet. If it is a new wallet then the balance will be 0. You or somebody else need to send coins to your address. What is the address? We have said that the wallet is like a bank account. You are used to having a bank account number that you can provide to anybody in order to receive money to your account. A bank account number is a collection of 10–12 digits and a bank code that is written behind the character /. A bank account can look like this: 0500121502/0800. The Cardano wallet allows you to generate more addresses that can be used similarly as a bank account number. It can be a bit confusing that you can generate more addresses for receiving coins. The reason is privacy. You can provide a different address to Alice, a different address to Bob, etc. Cardano address can look like this:


It is the address that I have just generated in my Daedalus wallet. If you send ADA to the address then I will receive the coins. Notice that I can publicly reveal the address and I am not afraid of stealing money from my wallet. It is not possible since only I own a corresponding private key for the address. I am able to sign a transaction. It means that only I am able to create a transaction that will be processed by the network. Nobody in the world is able to do so under the condition that I have well protected the passphrase.

You can send a generated address to Alice or Bob. Or you can send the same address to both. Remember that once a new address is created it can be used over and over. Alice and Bob can send you ADA coins every day to the same addresses and only you will be able to spend these coins. Coins will be received even in the case that your computer is switched off. It is not recommended to use the same address over and over, though. It is better to generate a new address for every transaction.

If you want to send ADA to somebody else then you need to ask for his or her address. Then you just instruct the wallet to send a certain amount of coins to the address. And that is it.

Be very careful when you operate with addresses. Always ensure that you use the whole string from the beginning to the end. If you forget one letter then the coins can be lost forever. When you copy/paste the address then ensure that the address is the same after copying from an email or chat to the wallet. There can be malware in your computer that can secretly exchange your address with the address of a scammer. Thus, you can accidentally send ADA coins to the scammer instead of your friend.

There are more blockchain projects in the crypto world and each uses its own addresses. You always need to be sure that you send ADA coins to a Cardano address and BTC coins to a Bitcoin address. For example, it is not possible to send ADA coins to a BTC address or vice versa. If you do so then your coins can be lost.

For safety reasons, you can use the following trick to be sure that you do not lose a big amount of your coins. Let’s assume that you want to send coins to an address but you are not sure whether the coins will be received. Well, you can send only 1 ADA to the address and ensure that the coin is transferred. If it is the case then you can just repeat the process with the rest of the coins. It is relatively easy to verify that coins have been delivered. You can use Cardano explorer and put the transaction ID or the address into it. You will see the current status of the transaction or all transactions related to the address. When a transaction is confirmed then coins have been delivered.

Now you know the theory. We are going to buy ADA coins. You already have a wallet so you can generate a new address that you will use to send ADA coins from an exchange to your wallet.