What is a wallet and how does it work?

A wallet is a piece of software that stores the secrets (private keys) used to access cryptocurrencies. The wallet stores the private keys in an encrypted form and allows users to store, send, and receive cryptocurrencies to and from other addresses. In order to conduct transactions, the user must have the private key associated with the account or address they wish to transact with. The wallet also generates a unique address where users can accept payments.