Hot Wallets

A hot wallet is a digital storage solution for cryptocurrencies that is connected to the internet. It allows quick access and convenient transactions but is more vulnerable to hacking and cyber threats due to its online nature. Hot wallets are typically used for daily trading or immediate spending, making them ideal for frequent activity. They contrast with cold wallets, which are offline and considered more secure for long-term storage. While hot wallets offer ease of use, users should only keep a portion of their crypto assets in them and transfer larger holdings to more secure, offline options.