1. A cryptocurrency wallet stores the private and public keys that are necessary for a user to access their cryptocurrency funds. When you receive cryptocurrency, you will be given a private key which allows you to access your funds at any time. That private key is stored in the wallet.
2. Wallets protect your cryptocurrency from hackers by encrypting your private key with a strong password. This means that only you can access your funds, as no one else knows the passwords to your wallet.
3. Many wallets also provide two-factor authentication (2FA), which requires users to enter a unique code each time they make an online transaction. This helps to ensure that only the rightful owner of the funds can access them.
4. Some wallets also provide backup options so that users can easily recover their funds in the event that the wallet is lost or stolen.
5. Finally, many wallets have additional security features such as multi-signature transactions, wherein multiple users must sign off on a transaction before it can be activated.