Cold vs Hot Wallet

• A cold wallet is a wallet, which is not connected to the Internet. Hardware wallets are the typical cold wallets. If you have some time and skills, you could also create a cold wallet yourself - but that’s not part of this article. Some markt leading companies are Ledger and Trezor. Both solutions start at $60 - 70$.

• A hot wallet is (more or less) continuously connected to the Internet. Basically, these are software packages, such as browser extensions or apps.

Security aspects

While software wallets apply several mechanisms to protect your secrets (your mnemonics should never ever be saved on your computer!), hardware wallets tend to imply a lower risk of being hacked.

This is of course a very bold statement, and I’m not saying that software wallets can’t be set up to be just as secure as hardware wallets. It’s just that hardware wallets - from the point of view of usage - are less prone to security-related (user/usage) errors than software wallets. If a clean computer is available to you and no secrets are stored on the hard drive, a software wallet can be operated just as securely as a hardware wallet. However, above a certain investment amount, we recommend hardware wallets - especially for long-term investments.

If the investment amount is not that great, software wallets such as Yoroi work well enough and provide usage benefits, because you can almost always access it and act.

So in the end, it is about the old story: Take the aspects of costs, usability and wanted level of security and balance them out.

Hardware Wallets

• Hardware Wallets are a must-have for big holders in crypto.
• There are certain thoughts invoked for deciding for a hardware wallets in stacking. If you just want to stake 1-3 cryptos, go for the Ledger Nano S. If you have deeper pockets, buy the Ledger Nano X, which is double the price, but comes with more than 100 apps at the same time and adds Bluetooth support. Still, the Ledger Nano S is working very stable and can provide an entry into hardware wallets.
• Other widely used hardware wallets are supplied by Trezor, such as Trezor One (the Ledger Nano S from Trezor) or the more-advanced Trezor Model T (starting at around $150).

Consider what is important for you: Buying the flag-ships of hardware wallets with high compatibility in various crypto staking projects, or lower prices in established products and a limited amount of cryptos.

If you really want to dig deeper into hardware wallets, we suggest this site as a startup

Whatever you do: Take some time to create and store your keys sa(v)fe!

Software Wallets

• For Cardano, typical hot wallets are Yoroi (Light) and Daedalus (Full).

• For Etherum and some other coins MetaMask, Trust Wallet and MyEtherWallet are some widely used examples.

• Also CoinBase released their own wallet and other exchange have some solutions in place as wekk.

Who made this?

This article have been written by cardano-stake.com, an independent Cardano Stake pool run by IT Security nerds. Stake with us on adapools.org and care about a green, decentralized blockchain. pool-id: 82ca61eba3000e955e5068b5c19b329384195a58cf57397337b8ca6e.

Licence

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