## Cold Wallet
A cold wallet is a type of cryptocurrency storage solution that keeps private keys offline and away from potential threats posed by the Internet. It is also known as “cold storage” or “offline wallets”, and provides an extra layer of security for digital currency users wanting to protect their funds against malicious attacks.
Cold wallets are typically hardware devices such as USBs, SD cards, or dedicated machines which store the user’s private key in an offline environment. This means that even if someone were to gain access to your computer or device, they would not be able to access your digital assets stored within a cold wallet since it does not connect to the internet. The user must manually enter their credentials into any online platform in order to retrieve their data and/or funds when using a cold wallet solution.
Typically anyone who owns more than one cryptocurrency should consider setting up some kind of cold storage system since it increases security drastically compared with other options like hot wallets (online wallets). Hot wallets are much less secure because they leave your private key exposed on vulnerable web servers where cyber criminals can easily take advantage of them if given enough time and resources.
Some popular examples of different types of cold storage solutions include:
– Ledger Nano S – A USB-style hardware wallet that stores cryptographic information securely on an encrypted chip
– Trezor – Another type of physical device used for storing cryptocurrencies securely
– Paper Wallets – These involve printing out a set of public and private keys onto paper then storing them somewhere safe (e.g., bank vault)
It is important to note that each type has its own strengths and weaknesses so it is best practice for users considering investing large sums into cryptocurrency portfolios should research all available options carefully before making any decision about what kind of storage they will use
