Hot Wallets vs Cold Wallets

in cryptocurrency •  4 years ago 

When looking into which wallet to store your coins, it's extraordinarily useful to know the difference between a cold wallet and a hot wallet. I'll explain the difference, and the pros and cons of both.

What's a Hot Wallet?

A hot storage wallet is a cryptocurrency wallet that is connected to the Internet. These are often free and easy to use, but there are have their negatives as well.

Pros

  • Free
  • Easy to get
  • Easy to use for trading

Cons

  • Lighter security than cold wallet
  • Not as useful for storing large amounts
  • In some cases they are custodial wallets

There are many examples of hot wallets, including mobile crypto wallets and exchange wallets. Here's 3 examples:

  • Binance - Exchange
  • Bittrex - Exchange
  • Voyager - Mobile

Summary...

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