A wallet.dat is a file introduced by the original Bitcoin Core client and is used to store sensitive information associated with the user’s Bitcoin wallet. The wallet.dat file includes the encrypted private keys which can be used to spend the user’s Bitcoin balance.
Additionally, the wallet.dat file also stores a small amount of secure data related to the user’s address book. The wallet.dat file is used by Bitcoin clients such as Bitcoin Core, Multibit and other wallets for maintaining a local copy of the user’s addresses and transactions.
It contains a cryptographic keypair which is a combination of a public and private key. The public key is shared and used to receive payments, while the private key should never be shared and is used to sign off on transactions. Any time a transaction is created and signed with the private key stored inside wallet.dat, the corresponding funds will be transferred from the user’s wallet balance.
It is also important to note that the wallet.dat file should be backed up and securely stored to prevent theft or loss of funds associated with the wallet in the event of hardware failure or other unforeseen factors.