Hot wallet — a crypto wallet connected to the internet and used for quick transactions: storing small amounts, daily trading, receiving, and sending funds.
In simple terms, it’s like the wallet you carry in your pocket. Convenient — you take it out and pay. But it comes with more risks: you can lose it or it can be stolen.
How it works:
- Data and keys are stored on a device or server with network access;
- Funds can be quickly deposited and withdrawn;
- Because it’s online, hot wallets are more often targeted by hackers.
Difference from cold wallets:
- Hot — online, convenient, but vulnerable;
- Cold — offline, highly secure, but less convenient for daily use.
Exchanges therefore keep only a portion of funds in hot wallets — these are the ones most often attacked.
By the way, here you can buy legendary hardware wallets for beginners with all the basic functions!
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