Clear DefinitionsWatch-Only Wallet
Pronunciation
[woch-oh nlee woll-it]
Analogy
A watch‑only wallet is like viewing your bank account balance online without the ability to initiate withdrawals.
Definition
A wallet mode that tracks addresses and balances without holding private keys, enabling monitoring without spending capability.
Key Points Intro
Watch‑only wallets enable safe monitoring via:
Key Points
No keys stored: Cannot sign transactions.
Balance alerts: Notifies incoming/outgoing funds.
Integration: Useful for audits and treasury oversight.
Cold wallet companion: Monitors cold storage without exposure.
Example
An exchange uses a watch‑only wallet to track cold wallet addresses and trigger alerts on large withdrawals.
Technical Deep Dive
Wallet imports public address or xpub. It queries full nodes or explorers for UTXO or account state. Transaction history and balance displayed; signing disabled in UI.
Security Warning
Watch‑only does not protect against fake data from untrusted nodes; use multiple data sources.
Caveat
Cannot detect spent outputs without reliable backend.
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