Difference between hot wallet and cold wallet
Hot Wallet & Cold Wallet
First of all, anyone who is investing in virtual assets must have heard of hot wallet and cold wallet. And everyone knows that both hot and cold wallets are ‘cryptocurrency wallets’. Literally, hot wallet and cold wallet refer to accounts that can store virtual assets such as Bitcoin, Ethereum, and Filecoin.
Hot Wallet
First, a hot wallet refers to a wallet that is connected online and allows exchange of transaction information in real time. Because it has the characteristics of being connected online, it is mainly used when trading virtual assets. However, while hot wallets have the advantage of being able to quickly exchange transaction information, they are often targeted by hackers who exploit the fact that they are connected online.
Cold Wallet
Conversely, a cold wallet is a virtual asset wallet that is not connected online and can store private keys that can prove ownership of virtual assets. It mainly takes the form of hardware such as USB or card, and is known to be relatively secure because it is not connected to the Internet.
Difference between hot wallet and cold wallet
From 2017 to the present, many virtual asset exchanges around the world are being hacked by hackers with malicious purposes. Of course, the reason why cold wallets appeared was to prepare against hacker attacks. However, hot wallets and cold wallets each have their pros and cons.
As mentioned earlier, hot wallets lack security from hacking due to the nature of being connected online. However, hot wallets have the advantage of being less expensive than cold wallets because they enable real-time transactions and do not require additional management personnel or hardware. And because it is convenient to use, many individual investors are using hot wallets.
As mentioned earlier, hot wallets lack security from hacking due to the nature of being connected online. However, hot wallets have the advantage of being less expensive than cold wallets because they enable real-time transactions and do not require additional management personnel or hardware. And because it is convenient to use, many individual investors are using hot wallets.
Cold wallets are disconnected from the Internet, so their security is relatively high. However, since it is completely disconnected from the Internet, large investors, companies, and exchanges that own a lot of assets usually store their assets in a cold wallet.
However, if the recovery code is exposed in the cold wallet you own, it may be difficult to prove ownership, so care must be taken in management.
Then, how does Tokencan manage the assets of its customers?
After the Bithumb hacking incident in 2019, many exchanges started storing customer assets in cold wallets. And the Ministry of Science and ICT, a government agency of the Republic of Korea, also recommends storing more than 70% of your assets in a cold wallet. Tokencan also divides customers’ assets into hot wallets and cold wallets. More than 80% of assets are stored in cold wallets and 20% are stored in hot wallets, providing security and convenience to customers. And since there are more than two administrators who can open a cold wallet, customers’ assets can be more safely protected.
However, many virtual asset exchanges write phrases such as “security is thorough” and “cold wallet is used”, but some exchanges have a strong purpose of recruiting a lot of customers, so there are not a few places that pursue convenience rather than security. . For this reason, many exchanges around the world are still subject to hacking attacks, personal information is leaked, and customers’ assets are also damaged.
In 5 years, not one case of being attacked or harmed has been documented. The reason is that trading has been focusing on development day and night to keep an eye on the shortest fundamentals and provide the best possible service to our customers. As the transaction volume increases, the process of transferring the total amount from the cold wallet to the hot wallet occurs, so there are cases where the speed of deposit and withdrawal is stiff. However, in recent years, a lot of research and development is being done to properly use and manage hot and cold wallets to provide security and more time to customers.
So, it is true that our vertex cans never appear and never appear, but we do not see new customers after opening them only once. The biggest reason why customers love us so that customers can take the lead, such as increase and service, security, deposit products with high interest rates, and attractiveness of affiliates, has been resolved.
During the 5 risky years of increasing your credibility and being as successful as withdrawing cash, we will work tirelessly to give our customers more.
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