Crypto 101: Hot VS Cold Wallets

A crypto wallet is used to interact with a blockchain network. The three major types of crypto wallets are hardware, software, and paper wallets. Based on their work, they can be further classified as cold or hot wallets. Hardware wallets are physical devices that store your private keys offline. This makes them the most secure type of crypto wallet, but they can also be the most expensive and difficult to use. 

Software wallets are digital wallets that can be installed on your computer or mobile device. They are more convenient to use than hardware wallets, but they are also less secure. 

Paper wallets are the simplest type of crypto wallet, but they are also the least secure. They have fallen out of favor with many cryptocurrency fans because they are susceptible to environmental factors, can degrade with time, be misplaced, or otherwise be damaged. To create a paper wallet, you generate a public and private key pair and print the private key on a piece of paper. You can then store the paper wallet in a safe place. In reality, crypto wallets don’t store the currency but act as a tool of interaction with blockchain.

A hot crypto wallet is a type of cryptocurrency wallet that is connected to the internet. This makes them convenient for making transactions quickly and easily, but it also makes them more vulnerable to hacking and other security threats. Hot wallets typically use a combination of security measures to protect user funds, such as two-factor authentication (2FA), encryption, and seed phrases. However, it is important to note that no hot wallet is completely secure, and users should always take steps to protect their assets, such as using strong passwords and avoiding suspicious websites

A cold crypto wallet is a type of cryptocurrency wallet that is not connected to the internet. This makes it more secure than a hot wallet, which is a type of cryptocurrency wallet that is connected to the internet Cold wallets are typically physical devices, such as hardware wallets or paper wallets. Hardware wallets look like USB drives and store your private keys on a secure chip. Paper wallets are simply pieces of paper with your private keys printed on them.

A simple breakdown of the Types of Wallets


Hot Wallets

• Web Wallets - often accessed through a crypto exchange like Coinbase.
• Desktop Wallets - eg. MetaMask...
• Mobile Wallets - eg. Atomic, Trust Wallet...

Cold Wallets

• Hardware Wallets - eg. Ledger, Trezor...
• Paper Wallets - You can generate a paper wallet yourself by using a secure program to generate your keys, printing them out, and then deleting the program afterward.

That's all for today, stay out there.