You may have heard people online discussing the pros and cons of hot wallets vs. cold wallets and whether or not you need a cold wallet at all. Well if you are new to the world of crypto, NFTs and or DeFi you may not even be sure what kind of wallet you have been using to trade on various blockchains. Don’t worry too much because we have you covered. Here’s a fast and dirty breakdown of cold vs. hot wallets.
The defining trait of a hot wallet is that it is connected to the internet. They are programs or browser extensions that allow you to initiate crypto transfers and storage.
The truth is, hot wallets are necessary for anyone who wants to be part of the crypto/NFT ecosystem. It’s our responsibility to secure our hot wallets and make sure we aren’t getting hacked.
A cold wallet is a crypto wallet that is primarily offline and is only connected to the internet at certain times. It is a physical piece of hardware that stores info and can share info once it is connected online.
The main thing we all want to avoid is getting hacked and losing our bags and the best way to do that is to employ a cold wallet. Because transactions begin online and are only signed once the wallet goes offline your private keys are never exposed online. Period.
No matter how long you’ve been involved in the crypto space, everyone should seriously consider getting a cold wallet and securing your online presence.
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