Isn't an encrypted wallet.dat automatically a "watch-only" wallet? I have encrypted my wallet.dat outside of this computer. Now I store my wallet.dat on this computer.
If I open it in Bitcoin Core, I can view the balance but not spend it (without entering the decryption passphrase).
Doesn't this make an encrypted wallet.dat a &quot;watch-only&quot; wallet? Can't I simply safely keep this on my PC and use the RPC API to check on the balance to make sure that it still contains my coins?
Basically: What is the difference between an encrypted wallet and a &quot;watch-only&quot; wallet? Why would I make a &quot;watch-only&quot; wallet when the encrypted wallet apparently has the same functionality, and is as secure?
An encrypted wallet may be cracked if its password is weak with enough budget and computing power, while a watch-only wallet doesn't give any information other than the address and what can be derived from the address.