A hot wallet is a software wallet connected to the internet, offering convenience for frequent transactions but higher exposure to malware and phishing.
A hot wallet stores and uses private keys on an internet-connected device. It enables quick payments, QR scanning, and dApps, but increases attack surface. Good hygiene—device updates, strong passwords, and phishing awareness—is essential.
"A mobile wallet used for daily spending is a hot wallet; keep only small balances on it."
"Browser extension wallets integrate with dApps but require careful permission review to avoid signing malicious transactions."
Risks include malware, clipboard hijacking, SIM swapping (for SMS 2FA), and phishing. Mitigations include hardware-backed secure enclaves, biometrics, strong device lock, and using hardware wallets for high-value transactions.
"Verify receive addresses and enable address book/allowlist features to reduce the risk of clipboard or UI spoofing."
"For large transfers, connect your hot wallet to a hardware wallet so the private key never leaves the device."
Hot wallets excel at everyday payments, microtransactions, and interacting with apps. They can also act as watch-only or read-only wallets for monitoring balances, while keeping signing restricted to a hardware device.
"Merchants use hot wallets with payment processors to accept BCH and sweep balances to cold storage automatically."
"Developers often test on a hot wallet and then secure production funds with multisig and hardware devices."
All terms and definitions may update as the Cryptionary improves.