How does a blockchain wallet work?

A cryptocurrency wallet stores both the private and public keys for a transaction. To validate a transaction, the wallet communicates with various Blockchains, allowing users to buy or sell one or more cryptocurrencies. But, what actually happens in the background to allow for a secure cryptocurrency transaction? Let's look at an example to help you understand.

Assume you receive a Bitcoin or equivalent digital cash as a gift. By doing so, the sender transfers ownership of that currency to the address of your Blockchain wallet. To be able to spend those coins, the private key in your wallet must match the public key allocated to the currency. Your wallet balance will increase when both keys match. There is no cash exchange in this procedure, but a transaction is committed, recorded on Blockchain, and the modifications are subsequently reflected in the wallet.