Most cryptocurrencies are decentralized, without central bank or government support. In the world of blockchain, whoever has the private key represents the ownership of the asset corresponding to the private key . This also means that when the private key of your Bitcoin or EOS is stolen, you cannot Like a traditional bank savings card or credit card stolen, the bank can return the lost or stolen money to the account holder, but can only bear the loss.
In order to protect the security of our digital currency, the wallet is very important. It is a tool for storing and using digital currency. According to different storage methods, it can be divided into cold wallets and hot wallets. The way to distinguish between a cold wallet and a hot wallet depends on whether it is connected to the Internet. These two wallets have their own merits and are very important. No matter which kind of wallet, we need to keep them carefully.
1. Cold wallet
A cold wallet is an offline wallet used to store cryptocurrency.
If you hold a large amount of cryptocurrency, using a cold wallet to store idle funds is a relatively safe choice. As an offline wallet, because it is not connected to the Internet, the outside world generally cannot access the location where the private key is stored through the network, so you can Avoid hacker attacks or Chinese Trojan horse viruses.
2. Hot wallet
Contrary to cold wallets, hot wallets are wallets that are stored online.
Hot wallets refer to wallets that can access your private key on the Internet. Hot wallets are often in the form of online wallets. When using hot wallets, it is best to set different passwords on different platforms. And turn on the secondary authentication to ensure asset safety. Generally speaking, ordinary retail investors use hot wallets more frequently because of their convenience. Larger users will use cold wallets because of their huge assets and prevent the risk of hacking.
3. Cold wallet vs hot wallet
In terms of security, hot wallets are not as good as cold wallets. The networking function makes hot wallets slightly inferior in terms of security. On May 8, 2019, the exchange Binance was hacked and stolen 7000 bitcoins from the hot wallet. But if you consider portability, the hot wallet in the networked state can be used for asset transactions at any time, and the use experience is more convenient and faster.
4. User guide
1) Back up the private key and mnemonic
For the security management of digital wallets, the private key or mnemonic must be backed up and stored. Remember that the mnemonic phrase and private key must not be saved in the mobile phone or stored online in the cloud disk, do not copy and paste the collection on social platforms, and do not transmit the "private key, mnemonic phrase, password, keystore through the Internet."
2) Don’t download software that is not available
Don't just download software from unknown sources, especially those related to cryptocurrency assets. You must jump to the official website to download the software. If you enter the private key in these ways, it is technically easy to get it.
3) Do not connect to public WiFi
I have heard that Alipay payment passwords have been stolen using public WiFi . The same is true for digital currency wallets. It is easy to be stolen inadvertently.
Cold wallet and hot wallet have their own advantages and disadvantages, which one should I choose?
The editor believes that it should be used according to their respective digital currency assets. A small amount of digital currency that is often used for trading can be put in a hot wallet and used as ordinary change; a large number of high-value digital currency assets are put In the cold wallet, as long-term storage assets. For holders of larger assets, the use of hot and cold wallets together can satisfy convenience while isolating risks and better protect the security of virtual currency assets.
Friends who want to download the blockchain wallet can go to the ChainStore blockchain application store to download the experience.