A light wallet, also known as a lightweight wallet or SPV (Simplified Payment Verification) wallet, is a type of cryptocurrency wallet that allows users to interact with the blockchain without needing to download and maintain a copy of the entire blockchain.
In a standard blockchain network, full nodes hold and manage the complete record of all transactions on the network, which can be quite data-intensive and require substantial computational resources. By contrast, a light wallet communicates with these full nodes to obtain the necessary data to complete transactions.
Light wallets only need to download the headers of the blockchain blocks (which are significantly smaller in size compared to the entire block), making them more suited to devices with limited storage or processing power such as mobile devices. They use a method called Simplified Payment Verification (SPV) to verify transactions.
Despite their convenience, light wallets do have some trade-offs. They rely on third-party nodes for transaction information, which may introduce some degree of risk if those nodes are compromised. Moreover, since they don’t fully validate transactions or blocks, they might be more susceptible to certain types of blockchain-related attacks compared to full nodes. Nonetheless, for many users, the advantages in terms of speed, convenience, and lower resource use make light wallets a preferred choice.