I don't understand the point of a Watch Only Wallet. I've seen posts that state these wallets don’t contain any private keys, which means they can’t be used to spend coins they receive. In which case how do you use the coins in the wallet.

In other posts however I see references to using a private key to send coins. In which case how are these then different from a standard wallet and private key?


A "watch-only" wallet is used in the context of "cold storage". Cold storage means that the private key for spending is not online, but offline somewhere (a USB key, a printed QR code etc) which is obviously much safer from online attacks (although not without their own risks). A watch-only wallet allows you to watch what happens to those cold storage bitcoins without exposing the private keys to the online world.

The references you mention are very likely describing how the offline private key can never the less be used to sign an online transaction.


Actually, a lot of exchanges and wallets are using Cold Storage. At first, it is easier to have control over large amounts of users and transactions. That's why there is a Memo for Steem and Destination Tag for XRP. That makes a differentiation between the users easier. Freewallet, for example, uses Cold Storage as I remember.

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