It seems that Blockchain and bitcoin are the dominant words in the public discourse. Many want to enter the field and experience it themselves but discover that there are several steps on the way to the world of cryptographic currencies. As in the tangible world, when we want to carry actual money like coins and bills, so in the cryptographic world, we need a wallet. So let’s learn how to open a wallet, what is essential to be careful about and what needs to know about the differences between the various wallets.
Hot wallet – allows immediate receipt and sending of cryptographic coins, and keeps in constant contact with the bitcoin network through the Internet.
A cold wallet, however, is not intended for everyday use as a fee for services or commerce. It allows you to receive money at any time but is not directly connected to the Internet on a regular basis. It can be said that it is designed to store cryptographic coins out of line, usually long-term.
While the hot wallet is relatively vulnerable to hacking because it is connected to the network, the cold wallet greatly reduces the possibility of hackers stealing money from it. If you are looking to simplify both concepts, the cold wallet is like your savings plan, while the hot wallet is like your current account.
Therefore, the general recommendation is to keep a hot wallet with minimal capital for purchases, sales, and daily activities, while the rest of the capital is recommended to transfer and hold a cold wallet such as a paper wallet or hardware wallet that is not always connected to the network and requires a dedicated component.