Difference Between Hot and Cold Wallet

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To buy bitcoin is easy, but the security of BTC is a hard process. The security of bitcoin is based on the choice of wallet. Today we will discuss the choice of wallet. I will elaborate on the difference between hot and cold wallets.

what is the difference between hot and cold wallet

Hot Wallets

Hot wallets are those wallets that work on the mechanism of online storage. This technique is the basic and initial technique to store bitcoin. Moreover, you cannot spend bitcoin or any other cryptocurrency without hot wallets. Because hot wallets are the only source to make online transactions. However, hot wallets are considered less secure than cold or deep wallets. The chances of hacking increase when using hot wallets. Hackers can find an online path to reach your wallet address keys. People short term storage hot wallets are suggested because it is a hard process to send bitcoins from offline to hot wallets.

Best Hot Wallets

Every hot wallet has their own security preferences. The security of wallet depends on the manufacture of that wallet, moreover cheap wallets can cause lose of money. Below here I will share a list of some hot wallets that are best according to my personal experience.

  1. Electrum: Electrum is considered the best hot wallet among all the wallets available on the internet now. Electrum has both offline and online wallets.
  2. Exodos: This wallet has some unique features and less costly than electrum.
  3. Exchanges: Different exchanges offer wallets and that is secured too. As I have kept some of my cryptos for more than a year in a less famous exchange wallet.
  4. Blockchain: Blockchain is considered an official wallet for bitcoin. However, Folks from the crypto world love to use this platform without proper knowledge of it.
  5. Coinbase: Coinbase is the best to exchange and crypto wallet. This wallet supports more than 100 different cryptocurrencies. You can exchange BTC and other cryptocurrencies instantly with it.

Why should I choose hot Wallet?

As I have mentioned above that hot wallets are online wallet. These wallets are easy to manage and if you want instant exchange services hot wallets have the option to spend Bitcoins instantly. If you don’t want to store bitcoins for the long term you should choose hot wallets. The process of storing Coins in It is easy. You can transfer your Digital money to any other wallet in no time. Keep in mind that these online wallets are risky and less secure than offline wallets.

Cold Wallets

The cold wallet uses an offline storage mechanism to store digital currency. These wallets are more secure than hot wallets. Some cold wallets use extra secured features that are breakable. No one can break the security of it. These wallet use cut out internet method to store bitcoins. Cold wallets further divided into subcategories. These categories include BTC paper wallet, Hardware wallets, and deep cold storage. paper wallets are simple papers with private keys and barcode printed, you can use the best paper to reduce the risk of damage to the paper. Hardware wallets are available on the different websites you have to buy hardware device where you will be able to store your wallet keys. Deep cold storage mechanism refers to store hardware wallets in the locker.

Mobile and desktop wallets for multi crptocurrencies

Are Cold Wallets safer then Hot wallets?

No doubt cold wallets are safer than hot wallets. The basic reason for that: cold wallets store BTC far away from the internet and computers. which keeps hackers away and no one can access your private keys except you. Hot wallet store keys online and the chances of the hack are likely higher in online storage. Both have cons and pros. Both the methods are good according to the situation. Like, cold storage is the best option for storing bitcoin for a long time, while a hot wallet is ideal for spending BTC on regular basis.

Which is the best Cold Wallet?

I have heard this question multiple times that which is the best cold wallet for the storage of cryptocurrency. If you think you can keep your papers in a secured place paper wallets are the best cold storage wallet. The reason behind this is that you have to invest a very less amount to get a paper wallet and you can keep it anywhere you want. Hardware wallets are no doubt equipped with great security systems but these wallets are costly. If you can afford still you should use paper wallets as these wallets are using no technology to store coins. hardware wallets are using technology.

Best Multi CryptoCurrency Wallets

Many wallets have the ability to store more than one cryptocurrency. Different hot and cold wallets are designed to keep different digital coins in the same wallet. Below here I have enlisted the wallet that is the best for multi-cryptocurrency wallets according to my knowledge and experts' views.

Hot wallet for multi cryptocurrnecy

  • Electrum: is the best multi cryptocurrency hot wallet for advanced crypto currency users. Due to its interface, it's not recommended for newbies.
  • Exodus: This wallet is designed to keep more than one cryptocurrency. Due to its easy User interface beginners in this field enjoy using this wallet.
  • Mycelium: is best known for its mobile users. This wallet is specially designed to keep multi crypto coins in a mobile wallet. this is a great example of mobile hot wallets.

Cold wallet for multi cryptocurrnecy

  • Ledger Nano S: This cold wallet is best among all the cold wallets for multi-digital currency wallets due to its security and interface.
  • Trezor One: This wallet was designed by SatoshiLabs feature by the Czech republic cybersecurity team. A great and well security arrangement multi-coin wallet.
  • Atomic Wallet: Atomic wallet is a simple and new wallet that has very improved technology used. You can store multiple cryptos in your device with the help of an atomic wallet.