Cold wallet
Cold wallets are one of the most reliable and secure methods of storing cryptocurrency currently available on the market. They are cryptocurrency wallets that do not connect to the internet, thereby making them safe from any cyber-attacks or hacking attempts. On the other hand, hot wallets are wallets that connect to the internet, with the sole aim of making crypto transactions easier. While exchanges and most mobile wallets fall within the hot wallet category, examples of a cold wallet include hardware wallets (Ledger, Coldcard, and Trezor), paper wallets, and our solution, AirGap Wallet.
How a cold wallet works
To do cryptocurrency transactions, every wallet needs two components, a public key and a private key. The public key is similar to the wallet address and is used to receive funds and check balances, while the private key is utilized by the wallet owner to authorize spending of their funds.
When a user wants to send funds, the private key is needed to digitally sign the transaction. In a hot wallet, both the public key and the private key are located in the same app. So the signing happens on an online device and there is a risk that the key can be leaked to the internet or stolen by hackers.
However, in the case of a cold wallet, the signing process takes place offline. Though the transaction begins online, it is subsequently sent offline to the cold wallet, where it can be digitally signed in a secure environment. After the transaction has been signed on the offline device, it is sent to the public blockchain network.
The most important reason for using a cold wallet is that the private key never gets anywhere close to the internet.
When to use a cold wallet
Cold wallets are particularly well suited for people who wish to store a large amount of cryptocurrency assets in a secure environment. When using a cold wallet, you don’t have to worry anymore if you have a virus on your computer or if someone gets physical access to your online device. The private key is always securely stored on a dedicated offline device. This makes it the most secure way of holding crypto and is recommended for everyone.
Historically, one major downside of cold wallets is that they are more cumbersome to use. Often a computer was required to do transactions, so it wasn’t a good solution when you were on the road. With AirGap, this changed. AirGap can be used both on desktop and mobile, so it’s very flexible and easy to use. With this in mind, there really isn’t a good reason why you shouldn’t always use a cold wallet.
Comparing some common cold wallet options
As mentioned earlier, some examples of a cold wallet include hardware wallets (such as those from Ledger, Coldcard, and Trezor), paper wallets, and our solution, AirGap Wallet. In this section, we will examine the differences between these options and explain why we believe the AirGap wallet is the preferable solution.
Conclusion
The items on the preceding list are by no means all-inclusive. When comparing AirGap Wallet to other cold wallet solutions, we can see that it offers some additional notable features such as no vendor lock-in and no KYC requirements, while maintaining the same level of security as other solutions. It is open-source, free, has good documentation, is constantly updated, and it is developed and maintained from a country that has a generally positive stance toward crypto. All these and more are reasons why we think AirGap Wallet is a more preferable solution.
Download AirGap
AirGap Wallet
📱 iOS — App Store
📱 Android — Google Play (GitHub APK)
💻 macOS
💻 Windows
💻 Linux
AirGap Vault
📱 iOS — App Store
📱 Android — Google Play (GitHub APK)
