An external transaction refers to the transfer of cryptocurrency between different wallets that are not part of the same platform or exchange. This typically involves sending coins or tokens from one user’s wallet to another user’s wallet on a different service. These transactions often require a transaction fee to incentivize miners or validators who process and confirm the transfer on the blockchain. The fees vary based on network traffic and can influence the speed at which a transaction is completed.In addition, external transactions involve the use of public and private keys. The sender must use their private key to sign the transaction, while the recipient’s wallet address, a public key, identifies where the funds are headed. External transactions play a crucial role in establishing the value and utility of cryptocurrencies, enabling peer-to-peer trading and fostering decentralization. They allow users to move assets freely, contributing to the liquidity and overall functionality of the cryptocurrency ecosystem.