TL;DR
Avalanche Wallet is a cryptocurrency wallet on the Avalanche blockchain. It allows users to access Avalanche's ecosystem of decentralized applications (DApps).
Avalanche Wallet has three types of addresses: X-Chain, C-Chain and P-Chain. It is possible to store cryptocurrencies on any of the three integrated blockchains, for different purposes. Basically, the X-Chain is mainly used to store assets, the C-Chain allows interaction with smart contracts and the P-Chain is used for staking. It is possible to transfer tokens between the three blockchains within Avalanche Wallet.
When withdrawing your assets from your Avalanche Wallet, be sure to use a blockchain that is compatible with the destination wallet. For example, only the C-Chain wallet is compatible with MetaMask and Binance wallets. You can transfer your Avalanche tokens to C-Chain wallet using the cross-chain function.
Introduction
Avalanche is an open-source platform for Decentralized Applications (DApps) that aims to improve scalability, interoperability and usability within its three blockchains. If you want to explore and interact with DApps and the Avalanche ecosystem, you'll need the Avalanche Wallet.
What is Avalanche Wallet and how does it work?
Avalanche Wallet is a non-custodial browser cryptocurrency wallet used to interact with the Avalanche ecosystem. You can store, transfer and stake hundreds of different cryptocurrencies and even create your own NFTs (non-fungible tokens). You can also swap DeFi tokens from Binance Smart Chain, Ethereum, Polygon and other blockchains to Avalanche using bridge services such as MultiChain (formerly AnySwap).
As mentioned, the Avalanche network has three types of integrated blockchains: Exchange Chain (X-Chain), Contract Chain (C-Chain) and Platform Chain (P-Chain). X-Chain is a decentralized platform used to create and trade the native Avalanche token (AVAX) and other cryptocurrencies. C-Chain enables the creation of smart contracts and interaction with DApps and DeFi services. P-Chain coordinates the network's validators and can be used for the staking process on Avalanche Wallet. Learn more about how the three blockchains work in the article What is Avalanche (AVAX)?.
It is possible to store cryptocurrencies on any of the three integrated blockchains, for different purposes. Using AVAX as an example: it can be stored and traded on X-Chain, used on C-Chain to pay transaction fees and interact with smart contracts, or for staking and generating rewards on P-Chain. This may seem complicated at first, but you can easily move tokens from one blockchain to another using Avalanche Wallet's cross-chain function.
Note that each blockchain has its own format and wallet address. All X-Chain wallet addresses start with “X”, while P-Chain addresses start with “P”. C-Chain addresses start with a “0”, similar to Ethereum or Binance Smart Chain (BSC) addresses.
To transfer tokens to/from your Avalanche Wallet, you must select the corresponding blockchain address. For example, Binance and MetaMask wallets only support C-Chain. Be careful and make sure to check addresses before making transactions. You may lose your funds if you send tokens to an incompatible network.
How to create an Avalanche Wallet?
1. Go to the official Avalanche Wallet website and click [Create New Wallet]. Be careful with fake websites created by scammers. Before you begin, make sure you access the official link (URL).
2. Click [Generate Key Phrase] to reveal the key phrase.
3. 24 words will be displayed on the screen. This is the key phrase (or seed phrase) of your wallet. If you lose the key phrase, you will lose access to your wallet. It is not possible to recover a lost key phrase.
Write down the 24 words in exact order and check the box. Keep your key phrase (seed phrase) in safe offline locations and never share it with anyone. Click [Access Wallet] to proceed.
4. The system will ask you to repeat a few words from the key phrase to ensure you made the backup correctly. Enter the missing words from your seed phrase and click [Check].
5. Your Avalanche Wallet is ready to use. Click [Access Wallet] to open your wallet.
How to send AVAX from Binance to Avalanche?
Before you can start interacting with DeFi DApps on Avalanche, you will need AVAX tokens in your Avalanche Wallet to pay transaction fees. You can purchase AVAX tokens from exchanges like Binance and send them to your Avalanche Wallet.
Let's see how to transfer AVAX from Binance to Avalanche.
Note that only C-Chain is compatible with the Binance exchange. In other words, it is only possible to send AVAX from Binance to your Avalanche Wallet via C-Chain. Take care! If you select the wrong blockchain, you may lose your tokens.
1. Log in to your Binance account and go to [Wallet Overview] - [Withdraw].
2. Select [AVAX] from the token list.
3. Access your Avalanche Wallet and click [C] to find your C-Chain wallet address and copy it.
4. Go back to Binance and paste the address into the [Address] field. Then click [Network] to select the Avalanche [AVAXC] C-Chain network.
5. Enter the amount to be transferred and click [Withdraw].
6. Before clicking [Confirm], read the risk warning carefully.
7. Check your withdrawal details.
8. Perform 2FA verification of the withdrawal and click [Submit]. Your AVAX tokens will be sent to your Avalanche C-Chain wallet.
How to transfer tokens between Avalanche's X-Chain, C-Chain and P-Chain blockchains?
To move your funds from one blockchain to another, you will need to use the cross-chain transfer function. For example, to send AVAX to your MetaMask wallet, you must transfer the tokens to your C-Chain wallet first, as only C-Chain is compatible with MetaMask. If you select the wrong blockchain, you may lose your tokens and you will not be able to get them back.
In this example, we will use the cross-chain function to transfer AVAX from the X-Chain to the C-Chain.
1. Log in to your Avalanche Wallet and check your wallet balance at the top. In this case, our AVAX tokens are in the X-Chain wallet.
2. Click [Cross Chain] in the left menu.
3. Select [C-Chain] as the destination blockchain and enter the transfer amount. Click [Confirm] to proceed. Note that you will pay a small transaction fee every time you move assets between blockchains.
4. Your AVAX tokens are now in your C-Chain wallet. You can now transfer them to MetaMask or another compatible wallet.
How does AVAX staking work (validator vs. delegator)?
You can also stake AVAX with your Avalanche Wallet to get more AVAX tokens. There are two ways to get rewards on AVAX: becoming a validator or a delegator.
Validators are active nodes that validate transactions and protect the blockchain. The more AVAX tokens staked, the greater the chance of you being selected to participate as a block validator.
Delegators do not process transactions, but support the work of validators. When validators receive their rewards, delegators get a proportional share of the staked AVAX.
As of January 2022, these are the requirements for staking:
Being a validator requires more technical knowledge and requires you to run an Avalanche node with specific software on your computer. We won't cover the technical details in this tutorial. Please see the official Avalanche documentation for more information.
How to stake AVAX as a delegator using Avalanche Wallet?
Before starting, you must transfer the required amount of AVAX tokens to the P-Chain wallet.
1. Log in to your Avalanche Wallet and click [Earn] in the left menu.
2. Click [Add Delegator].
3. You will see the list of active validators. Click [Select] and choose the user you want to delegate your AVAX tokens to.
4. Select the duration and enter the amount of AVAX tokens to stake. Note that it is not possible to set the delegation duration to a date later than the end date set by the validator.
Check your rewards address. It should display your P-Chain wallet address. Click [Confirm].
5. You will see the delegation details and start earning rewards in AVAX.
Final considerations
Avalanche Wallet allows you to access the growing collection of DeFi DApps in the Avalanche ecosystem. From the same wallet interface, you can access Avalanche's three blockchains, each serving different use cases and purposes. To learn more about the Avalanche blockchain, read the article What is Avalanche (AVAX)?.
