cold and hot wallet

To enter the world of cryptocurrencies, you need an environment where you can buy, sell, exchange and store crypto or fiat currencies.

For this you need an exchange, a market and a wallet.

The exchanges themselves can offer you all this in one place.

The most famous are Binance, Coinbase, Crypto.com …

These exchange offices are characterized by being centralized, which means that the manager is behind.

This determines the conditions and rules with which you work at the exchange office.

That’s why the cryptocurrencies and fiat money you have on these exchanges are not really yours …

Until you transfer it to your cold or hot wallet.

What is the difference between them?

A hot wallet is an online space in the form of an application where you can store your cryptocurrencies, NFTs and other crypto tokens.

In this application, you can convert crypto coins from one to another, connect to other applications or websites where you buy, sell, borrow, pledge … your crypto coins.

With a hot wallet, you can also buy and sell NFTs, connect to Play to earn environments where you play games and earn cryptocurrencies…

The most famous hot wallet is Metamask.

The hot wallet therefore has many useful advantages, but because it is an online application, there is a possibility of online abuse of it.
So, intrusion into it and places of value in it.

Hot wallets have quite a few systems of protection against abuse, such as two-step password verification (e-mail and sms) or fingerprint identification, but there are still cases where inconveniences occur.

That’s why cold wallets developed …

Cold wallets are actually external hard drives or usb sticks.
The only feature of these is that they are not connected to the Internet. They are physical.

Therefore, they are more reliable in terms of security.

In their usefulness, however, they do not differ from the hot ones.

The best known and safest are Ledger and Trezor cold wallets.
Security in the crypto world is very important, especially for those who have large sums in their wallets.

That is why it is very important what kind of wallet you use and especially how you use it …

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