What a wallet actually is
A crypto wallet does not store coins the way a purse stores cash. The coins exist on a public blockchain. A wallet holds the keys that prove you are allowed to move them. Whoever controls the keys controls the funds.
Public address: safe to share
A public address is like an account number. You give it to people who want to send you crypto. Because blockchains such as Bitcoin, Ethereum and Solana are public, anyone with an address can look up its balance and transaction history in a block explorer. The address cannot be used to spend anything.
Sharing an address does have a privacy cost — it reveals the balance and history linked to it — but it does not give anyone access to the funds.
Private key and seed phrase: never share
A private key is the secret that authorises spending from an address. A seed phrase (also called a recovery phrase), usually 12 or 24 words, can regenerate all the private keys in a wallet. Anyone who has either can move your funds, from anywhere, and blockchain transactions generally cannot be reversed.
| Public address | Private key / seed phrase | |
|---|---|---|
| Purpose | Receive funds, view balance | Authorise spending, restore wallet |
| Safe to share? | Yes (with some privacy cost) | Never |
| Can move funds? | No | Yes, completely |
| Needed to track a balance? | Yes | No |
Custody, explained
When you hold crypto on an exchange, the exchange holds the keys. That is custodial: convenient, but you depend on the exchange's security and solvency. Self-custody means you hold the keys yourself, in a software or hardware wallet. You remove the exchange risk, but take on full responsibility for keeping the keys secure and backed up.
Neither is risk-free. What matters for tracking is that monitoring a self-custody wallet should never require giving up that custody.
How read-only tracking works
Because balances are public, a tracker only needs your public address. It reads the blockchain — directly or through a data provider — to see which assets the address holds, then values them using market prices. Nothing is signed, nothing is approved, and nothing can be moved.
Red flags
Any service that asks for the following merely to show you a balance should be treated as unsafe:
- Your seed phrase or recovery words.
- Your private key.
- Your wallet password.
- A signature or transaction approval for "verification" or "syncing".
- Permission to spend tokens on your behalf (a token approval).
Legitimate support staff will never ask for your seed phrase. Websites and pop-ups that do are almost always scams, however official they look.
Practical habits
- Store seed phrases offline, never in screenshots, cloud notes or email.
- Double-check addresses before sending; malware can swap copied addresses.
- Periodically review and revoke old token approvals you no longer use.
- Consider a hardware wallet for larger amounts.
- Be cautious about connecting your wallet to unfamiliar websites.
A limitation of wallet tracking
A blockchain shows what an address holds and what moved in and out. It does not reliably show what you originally paid, especially if the coins were bought on an exchange and transferred in. A careful tracker will show a wallet's current value but mark the cost basis as unknown until you add it. Read Understanding Cost Basis for why guessing is worse than admitting the gap.
How Compndr tracks wallets
Compndr's wallet tracking is read-only. You paste a public Ethereum, Solana or Bitcoin address; Compndr reads the balance and values the assets it can identify and price. It never asks for, stores or processes seed phrases, private keys, wallet passwords, signatures, transaction approvals or spending permissions. Tokens it cannot identify with confidence are not shown as fake zero balances, and wallet purchase history is not invented: cost basis stays unknown until you supply it.
If your crypto is spread across exchanges and wallets, Tracking Investments Across Multiple Accounts explains how to avoid double-counting transfers.