Crypto wallets vs exchanges serve different purposes in the cryptocurrency ecosystem. A crypto wallet is a secure digital storage system where users can hold their private keys and manage their assets. On the other hand, an exchange is a platform where cryptocurrencies are bought, sold, and traded. While exchanges offer convenience, they may not provide the same level of security as wallets. Crypto wallets prioritize asset safety, giving users full control over their private keys. Conversely, exchanges are necessary for trading but often keep users' private keys, making wallets a preferred option for long-term storage.