Cold Storage

What does cold storage mean when discussing cryptocurrency?

A cryptocurrency wallet not connected to the Internet

When a cryptocurrency owner refers to "cold storage," they're talking about an offline device they use to store their cryptocurrency wallet and private key. A crypto owner's cold storage may be a USB drive, external hard drive, CD, or in some rare cases, even a piece of paper with a printed QR code.

What is a cryptocurrency wallet?

A wallet is a program cryptocurrency owners use to access and manage their coins. Each wallet is linked to a private key, which acts as the wallet's "address" for cryptocurrency transactions. When cryptocurrency owners conduct a transaction, coins are either routed to or taken from their wallets.

What's the benefit of crypto cold storage?

Because Bitcoin and other cryptocurrencies are not insured by a centralized institution, if a person's cryptocurrency is stolen, it is likely gone for good. A person's private key allows access to their cryptocurrency, so storing the key in an online wallet (or hot wallet) makes it vulnerable to theft. This is why many cryptocurrency users prefer to store their wallets and private keys on a cold storage device, which never places the user's private key upon a network.

Example

"I invested in cold storage because I realllly don't want to lose my Dogecoin. To the moon!"
Even cold storage wallets aren't completely safe ...

Even cold storage wallets aren't completely safe ...

Related Slang

Usage

Last Updated: May 12, 2021

Cold storage definition

This page explains what the slang term "Cold storage" means. The definition, example, and related terms listed above have been written and compiled by the Slangit team.

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