Hot and Cold Crypto Wallets

Currently, we store our fiat currencies in different ways. Its physical form (currency notes) is kept in physical wallets/lockers, while its digital form is maintained with Banks in our respective bank accounts.

In this article, we’ll discuss the storage mechanism of cryptocurrencies (CC). Like any other currency, cryptos also need a mode of storage. Cryptos being based on decentralized blockchain networks are stored at unique encrypted digital addresses which are called wallets.

Now, these encrypted addresses can be stored in two manners.

1. On a physical device (not connected to the web) or even a paper — Cold Wallets
2. On a computer/system which is connected to the web — Hot wallet

Cold Wallets: Paper wallets, Trezor, Ledger Nano S, KeepKey, Bitbox, etc.

Hot Wallets: Coinbase, Electrum, etc.

Accessing Crypto Wallets: In order to access any crypto wallet there are two types of encrypted keys are needed.

1. Public key: This key can be shared by the wallet owner with anyone in order to receive the crypto
2. Private key: It is the second key (SHA256 encrypted) that is used to access the cryptos send to the wallet at the public key address. It is not to be shared with anyone by the wallet owner.

Creating a paper-based wallet:

1. Visit https://walletgenerator.net/
2. Move the cursor randomly on the screen for about 30s to generate the keys
3. Click print & it's Done!