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Tag: hot wallet

  • Hot Wallets vs. Cold Wallets: Differences, Pros and Cons

    Hot Wallets vs. Cold Wallets: Differences, Pros and Cons

    Hot and cold wallets are used to store your cryptocurrencies, specifically your private keys which grant you access to your crypto assets. They are therefore a crucial element of the cryptocurrency space.

    The major difference between hot and cold wallets is that hot wallets are connected to the internet whilst cold wallets are not.

    For those holding cryptocurrencies, the choice between cold and hot wallets depends on factors such as the amount of coins you hold, the frequency in which you trade etc.

    Click here to learn more about private and public keys.

    Hot Wallets

    Hot wallets are connected to the internet and are generally more popular.

    Examples of Hot Wallets

    Wallet NameSupported Coins
    Platforms
    Key Features    		Best For
    Best Wallet1,000+MobileNon-custodial, multi-chain, portfolio toolsOverall
    Zengo120+MobileMPC security, beginner-friendlyNew crypto users
    Binance Wallet
    460+    		MobileCEX integration, fast tradingExchange users
    Bybit Wallet
    750+    		Mobile, BrowserSecure Web3 access, stakingWeb3 and DeFi users
    OKX Wallet330+Mobile, BrowserdApp support, multi-chaindApp explorers
    SafePal
    1,000+    		Mobile, BrowserHardware wallet integrationHybrid users
    CoolWallet
    200+
    Mobile    		Scam protection, Bluetooth hardware optionSecurity-focused users
    CoinSpot Wallet
    300+
    Mobile, Web App    		Australian market focusRegional users (Australia)
    Hot wallet: Enjin mobile wallet
    Hot wallet: Enjin mobile wallet

    Pros

    • Instant Access: Always online, making it ideal for frequent trading, staking, and spending.
    • Free & User-Friendly: Most hot wallets are free and offer intuitive interfaces for beginners.
    • Mobile Integration: Seamless compatibility with smartphones, wearables, and browser extensions.
    • DeFi & NFT Ready: Direct access to decentralized apps and NFT marketplaces without needing external tools.
    • Cloud Sync & Recovery: Many wallets now support encrypted cloud backups and multi-device sync for easier recovery.

    Cons

    • Still Vulnerable to Hacks: Despite improved encryption and two-factor authentication, hot wallets remain exposed to phishing, malware, and SIM-swap attacks.
    • Custodial Risk: If you store assets on exchange-linked wallets, you’re still at risk from platform failures or regulatory shutdowns.
    • Privacy Trade-offs: Many mobile wallets now require KYC or link to identity data, reducing anonymity.
    • Device Dependency: Losing access to your phone or computer can lock you out, especially if recovery options aren’t properly set up.
    • Limited Offline Protection: Unlike cold wallets, hot wallets are always online, making them unsuitable for long-term, high-value storage.

    Cold Wallets

    Cold wallets are also known as hardware wallets. They are physical offline storage devices that you plug into your computer to use.

    Cold wallets
    Cold wallets: Clockwise from left, the Ledger Nano X, Trezor Model T and KeepKey

    Examples of Cold Wallets

    Wallet NameNumber of Supported CoinsPlatformsKey Features
    Best For
    Ledger Nano X / S Plus5,500+Hardware, MobileBluetooth support, secure chip, Ledger Live app
    Users needing broad coin support and mobile access
    Trezor Model T / Safe 51,000+HardwarePassphrase protection, open-source firmware, enhanced securityUsers prioritizing open-source tools but aware of hardware risks
    KeepKey40+HardwareLarge display, ShapeShift integrationSimplicity and visual clarity
    Cold Wallet (CWT)1,,000+Hardware, MobileCashback rewards, native CWT token, Plus Wallet acquisitionUsers seeking rewards and ecosystem integration
    Ellipal Titan 2.010+HardwareAir-gapped QR code transactions, tamper-proof designOffline security and remote attack resistance
    BitBox02
    20+    		HardwareDual-chip architecture, microSD backup, Swiss-madePrivacy-conscious and minimalist users

    Pros

    • Top-tier Security: Offline storage plus biometric authentication keeps assets safe from online threats.
    • Broad Asset Support: Compatible with thousands of coins and NFTs across major blockchains.
    • Advanced Backup Options: Features like Shamir Backup and encrypted microSD recovery reduce risk of loss.
    • DeFi Access: Secure bridges and apps allow staking and trading without exposing private keys.
    • Tamper-Proof & Transparent: Open-source firmware and tamper-evident hardware ensure trust and auditability.

    Cons

    • Cost Still a Barrier: Prices range from $79 to $199 depending on features like biometric security and multi-chain support.
    • Less Convenient for Active Trading: Transferring assets to exchanges for trading still adds friction, though some wallets now offer direct DeFi access.
    • Setup and Maintenance: Initial setup takes time, and firmware updates require manual steps to maintain security.
    • Physical Risk: Devices can be lost, stolen, or damaged—though encrypted backups and recovery protocols have improved.
    • Limited Mobile Experience: Despite Bluetooth and mobile apps, cold wallets remain less seamless than hot wallets for on-the-go use.

    Conclusion

    While cold wallets still require more effort to set up and use, they remain the gold standard for long-term crypto security. With biometric authentication, encrypted backups, and broader asset support, they’ve become more user-friendly without compromising safety.

    Hot wallets, on the other hand, continue to dominate for everyday use. Their integration with DeFi platforms, NFT marketplaces, and mobile devices makes them ideal for active traders and casual users. However, risks from hacks and custodial failures persist—even in 2025.

    Best practice: Keep small amounts in hot wallets for daily transactions and trading. Store the bulk of your holdings in cold wallets, and transfer profits promptly to secure offline storage. This hybrid approach balances convenience with protection.

  • MetaMask Integrates PayPal Payment in the U.S. for Easier ETH Purchases

    MetaMask Integrates PayPal Payment in the U.S. for Easier ETH Purchases

    MetaMask Enables U.S. Users to Purchase ETH via PayPal

    MetaMask developer ConsenSys has announced the integration of a PayPal payment option to its software wallet. Users will be able to buy and transfer Ethereum (ETH) by logging into the mobile MetaMask app, tapping on the “Buy” button, and selecting “PayPal.” This will redirect users to PayPal, where they can complete their transaction OR send ETH from their PayPal account to their MetaMask wallet.

    This feature will be rolled out to all U.S. users first in the coming weeks, as they are one of MetaMask’s largest markets in terms of users. For MetaMask’s desktop browser extension, MetaMask Product Manager Lorenzo Santos told Decrypt via email that it will be available in the next quarter.

    As of now, it is unclear whether the feature will be deployed in other countries or if other cryptos will also be available for purchase. Since ConsenSys is run by Ethereum co-founder Joe Lubin and MetaMask is an EVM-only wallet, it makes sense that ETH purchases are focused first.

    Unlocking the Web3 Ecosystem with MetaMask and PayPal

    As one of the top crypto wallet providers, MetaMask is often a starting point for users interacting with DeFi applications, GameFi, and metaverse platforms. And because PayPal is one of the largest online payment systems with 432 million active accounts worldwide, adding PayPal to MetaMask could broaden the customer base, making it easier for newcomers to enter the Web3 ecosystem.

    Santos stated in the press release, “this integration with PayPal will allow our U.S. users to not just buy crypto seamlessly through MetaMask, but also to easily explore the Web3 ecosystem.” 

    Traditional Payment Companies Expanding to Web3

    Over the past year, more and more traditional payment companies have been integrating crypto into their services. In fact, PayPal first began offering customers the ability to buy, sell, and hold crypto on its platform in 2020, and allowed customers to checkout with Bitcoin, Litecoin, Ethereum, and Bitcoin Cash in 2021. In June 2022, PayPal also enables customers to transfer crypto from PayPal to other wallets or exchanges. And now with the new integration into MetaMask, we can expect PayPal to release more new features gradually.

    Other traditional payment companies have also followed suit. Cash App, the number one finance app in the App Store, has also added support for transactions via the Bitcoin Lightning Network, the layer-2 protocol for Bitcoin’s blockchain. Stripe, an Irish-American financial services company, has also launched its own tool to help Web3 companies, allowing their customers to buy crypto with fiat.

    Other global financial services have also hinted at the possibility of dabbling into crypto. In October, Western Union filed trademark applications for managing wallets, exchanging digital assets and commodities derivatives, issuing tokens of value, and brokerage and insurance service, according to trademark attorney Mike Kondoudis.