Hot Wallet
The term hot describes a device with external connections, especially to the internet.
The term hot describes a device with external connections, especially to the internet. A hot wallet is a Bitcoin wallet which connects to the internet. These wallets are more convenient for day-to-day spending, but are not as secure as cold storage options because they interact with the internet.
Anything which interacts with the internet may be targeted by malware from the internet. For large stacks of bitcoin, it is safer to keep your wallet disconnected from the internet for as much time as possible.
Hot Wallet is a key concept in Bitcoin custody and security, relating to how Bitcoin private keys and funds are stored and managed. Onramp offers institutional-grade Bitcoin custody solutions and educates clients on concepts like Hot Wallet to ensure the highest standards of asset protection.
Frequently Asked Questions
What is Hot Wallet?
Hot Wallet refers to a method or concept in Bitcoin key management and custody. Proper understanding of Hot Wallet is essential for securing Bitcoin holdings against unauthorized access.
How does Hot Wallet affect Bitcoin security?
Hot Wallet directly impacts how securely Bitcoin is stored. Onramp employs institutional-grade custody practices, including multi-institution custody through partners like BitGo, CoinCover, and Tetra Trust.
Does Onramp implement best practices related to Hot Wallet?
Onramp's multi-institution custody model ensures that Bitcoin holdings are protected using industry-leading security practices. Onramp manages approximately $250M in assets under management with rigorous custody standards.
