The difference between hot and cold wallets lies in the level of internet connectivity and, consequently, in the balance between convenience and security.
Hot wallets
What it is:
Wallets that are constantly connected to the internet. They are convenient for active use.
Examples:
Mobile wallets (Trust Wallet, MetaMask, Rabby)
Desktop wallets (Exodus, Electrum)
Web wallets (Binance, Coinbase Wallet)
Browser extensions
Advantages:
Convenience and speed of access
Suitable for daily transactions and DeFi
Ease of installation and use
Disadvantages:
Vulnerable to hacking, phishing, and viruses
Depend on the security of the device
Best use:
Storage of small amounts for quick access
Use in DeFi, Web3, NFT, and trading
Cold wallets
What it is:
Wallets that are not constantly connected to the internet. Used for long-term storage.
Examples:
Hardware wallets (Ledger, Trezor, Keystone, Coldcard)
Paper wallets (offline generation and seed phrase storage)
Air-gapped devices (smartphones/laptops without network)
Advantages:
Maximum security
Protection against online threats, viruses, and remote hacking
Disadvantages:
Less convenient for quick transactions
Strict security hygiene must be maintained (recovery phrases and backups)
Best use:
Storage of large amounts
Long-term investments (HODL)
DAO treasury, reserve funds, asset backup
