Hot vs Cold Wallet Cryptocurrency

[BlockchainAppFactory]

A cryptocurrency wallet is not like any physical wallet that stores money. It does not actually store cryptocurrencies for its users. Rather, it stores the public and private keys that give users access to their cryptocurrencies. There are various types of cryptocurrencies depending on the way they are used and the platform that hosts them. A cryptocurrency wallet can be of two types:

• A hot wallet is an online wallet that is managed by a third-party who has the public and private keys.
• Cold wallets exist offline, on an app in a smartphone or desktop or even as hardware devices.

For users who are storing a minimal amount of cryptocurrencies, they can opt for hot wallets. But in case users are storing large volumes of digital currencies, it would be better to go for cold wallets for added security.

[bitmover]

There are also other kind of wallets, such as desktop wallets, mobile wallets, paper wallets...

What really matters is how the private keys are generated and stored.

Hardware wallets generate privatekeys offline and store them offline as well, this is why they are safer.

online wallets and mobile wallets generate and store them in an online environment, this is why they are not safe.

A desktop wallet may generate and store the keys offline, if the computer is properly airgapped.

[mk4]

Wrong, hot wallet isn't limited to online wallet which controlled by third-party. Hot wallet refers to wallet which connected to the Internet.

This. You're describing a custodial wallet with that description OP, not necessarily a hot wallet. You can have a hot wallet that's not controlled by a third party (e.g. Mycelium on Android, etc).

P.S. i don't see any points of this thread

*drumroll please!*

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🎺🎺 Merits!

[pooya87]

• A hot wallet is an online wallet that is managed by a third-party who has the public and private keys.

Wrong, hot wallet isn't limited to online wallet which controlled by third-party. Hot wallet refers to wallet which connected to the Internet.

+these things should not even be called "wallets" because they clearly aren't. they are "banks" that are in full control of your money.

For users who are storing a minimal amount of cryptocurrencies, they can opt for hot wallets. But in case users are storing large volumes of digital currencies, it would be better to go for cold wallets for added security.

amount should not be a factor in choosing between cold/hot wallets. how often you access those coins is the deciding factor because cold storage is a "storage" not something you cash out from every hour.

[BlockchainAppFactory]

Hot wallets are basically wallets that are connected to the internet that may or not may not be controlled by third parties. They are easier to access but more vulnerable to hacking than cold wallets. So it is important to choose a wallet that is well-known for its security. Hot wallets can be used when you are going to be executing trades frequently.

If you are only looking to hold your cryptocurrencies, a cold wallet will suit you well. You can always split your funds and store a part of it in a hot wallet and the rest in a cold wallet depending on how you want to use the funds.

[BitMaxz]

Hot wallets are basically wallets that are connected to the internet that may or not may not be controlled by third parties. They are easier to access but more vulnerable to hacking than cold wallets. So it is important to choose a wallet that is well-known for its security. Hot wallets can be used when you are going to be executing trades frequently.

If you are only looking to hold your cryptocurrencies, a cold wallet will suit you well. You can always split your funds and store a part of it in a hot wallet and the rest in a cold wallet depending on how you want to use the funds.

The cold wallet is not the only option if you are holding a large amount of crypto there is another option like hardware wallets.
Did you hear about them? If not there are 2 well-known hardware wallets the one is Ledger nano S and the other one is Trezor.
Other hardware wallets are listed here https://bitcoin.org/en/wallets/hardware/

However, if you don't have a budget cold wallet is a great option.