Term
Hot wallet
A hot wallet is any cryptocurrency wallet whose private keys are held on a device connected to the internet — mobile apps, browser extensions, and exchange wallets are all hot wallets, convenient for frequent use but higher-risk than cold storage.
A hot wallet is any wallet whose private keys live on a device with network access. Mobile wallets (MetaMask mobile, Trust Wallet, Phantom, Muun), browser-extension wallets (MetaMask, Rabby, Phantom), desktop wallets (Electrum, Sparrow) and exchange custodial wallets all count as hot. The convenience is real: you can send funds in seconds, connect to dApps, and receive payments without touching a hardware device.
The trade-off is threat surface. Any hot wallet is one malware infection, phishing site, or malicious browser extension away from having its private keys exfiltrated — and once the keys leave, the funds are gone. This is why the standard operational discipline is to keep only "spending money" in a hot wallet, and the bulk of holdings in cold storage.
A useful mental model: a hot wallet is a checking account, a cold storage setup is a savings vault. Transfer to the hot wallet just what you need for the next few transactions; leave everything else offline. Most losses in crypto history have been from compromised hot wallets, not broken cryptography.
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