Cold Storage
Cold storage keeps cryptocurrency private keys offline to reduce exposure to internet-based attacks.
✦ Key Insight
Keeping private keys offline can greatly reduce exposure to phishing, malware, malicious browser extensions, and remote hacking.
✕ Common Misconceptions
Cold storage does not protect against losing a recovery phrase, signing a malicious transaction, physical theft, or incorrect backups. Never share a seed phrase with anyone.
Detailed Explanation
In Practice
Dig Deeper
Hardware Wallet
A physical, offline device (such as Ledger Nano S/X, Trezor Model T, or KeepKey) that securely stores your cryptocurrency private keys and signs transactions without ever exposing the keys to the internet or your computer/phone.
Private Key
A private key is a secret cryptographic code that proves ownership of crypto assets and allows the holder to authorize transactions.
Hot Wallet
A hot wallet is a crypto wallet connected to the internet, typically used for quick access, trading, transfers, and interacting with decentralized applications.
Seed Phrase
A seed phrase is a set of words that acts as the master backup for a crypto wallet.
Custody
Custody describes who controls the private keys required to access and move cryptocurrency. In a self-custody arrangement, the user controls their own private keys or secret recovery phrase. In a custodial arrangement, an exchange, platform, broker, bot provider, or another third party controls the keys on the user's behalf.