Why cold is still preferred over hot?
In many areas of our lives, cold is still preferred over hot. For some people, cold water is much enjoyed over hot water. Cold pizza over hot pizza. Even colder weather is preferred over hot weather. In a study by a PhD candidate at UC Berkeley, research shows that hot weather makes us unhappy as compared to cold weather based on sentiment analysis. Research has also shown that cold showers actually better prepare you for the day because of their similarities to the benefits of cold therapy, which is used amongst all athletes in professional sports.
Cold can also be said to be the preferred way of storing cryptocurrencies and bitcoin.
There are a variety of wallet types that span the hot and cold specturm available for users of cryptocurrencies, but there are key differences between each. We will go over these differences and give a conclusion as to why the Ballet wallet is the best overall for crypto users in 2021. We’ll also use this piece to reiterate the importance of what it means to truly store your crypto offline in cold storage.
To briefly recap, a cold storage wallet means that the wallet is offline, and not actively connected to the internet. Non-electronic means that the wallet uses no electronic components. Something could be offline, but still electronic, like a computer being shut off. Being non-electronic and not actively connected to the internet is the true essence of cold storage.
Firstly, let’s do a brief recap on the types of crypto wallets that are currently available amongst crypto users.
Major types of crypto wallets and its associated risks
Some of the major risks and issues that users have experienced and described, specific to each wallet type, are the following;
Hardware Wallets (Some are considered “cold”, in the sense that they are not actively connected to the internet, but are prone to electronic component obsolescence)
- Difficulty of integration for new adopters of cryptocurrencies.
- Lack of internal storage space for adding and approving the storage of multiple cryptocurrencies.
- Your device being damaged and thus becoming inoperable.
- The risk of having your device stolen and losing every last bit of your funds.
- Your device being hacked through unknown malware installed on your computer, and having your wallet holdings stolen maliciously by hackers.
- Constant firmware updates and third party cloud server issues.
- You forget your password to access your Hardware Wallet, such as with Ledger wallets, and thus; Activating the protocol within the wallet that wipes your entire wallet’s cryptocurrency holdings by putting in the incorrect password 3 times.
Software/Mobile Wallets (These are hot wallets)
- Your wallet software becomes unsupported, leaving you with a wallet that has cryptocurrencies stranded in limbo without a way to access the user interface in order to withdraw them.
- Regulations in your country may require that your smartphone manufacturer is not allowed to host these Mobile Wallets for download any longer on their App Store, cutting you off from having what used to be an easy to use wallet-on-the-go.
- Lack of integration for cryptocurrencies on certain Software and Mobile Wallets may limit your ability to store the cryptocurrencies you would want, such as ERC-20 or BEP-20 cryptocurrencies.
- Incompatible software updates
Paper Wallets (The oldest form of a cold wallet but not commonly used in practice these days)
- You lose your paper wallet.
- The paper wallet becomes damaged and inaccessible.
- The paper wallet only can be used for one cryptocurrency, leaving it very inflexible and maladaptive.
- Ability to access and utilize crypto is extremely difficult
Simply put, there are far too many risks and barriers to entry associated with older wallet storage forms. For the average cryptocurrency user, these risks are just needless and easily avoidable by just using the Ballet wallet. The Ballet wallet has essentially provided a true form of cold storage with a compatible crypto asset management app that can interact with the physical Ballet wallet.
Below is a side by side comparison between the Ballet wallet and its popular “hot wallet” competitors.
Although there is no gold standard of crypto wallet security, each type does come with its own advantages and disadvantages. Wallet diversification should be top of mind when managing your own crypto assets. Having hot and cold wallets should not be mutually exclusive but the Ballet wallet should be considered your primary choice for true long term cold storage of your crypto.
As in the words of Katy Perry:
’Cause you’re hot then you’re cold
You’re yes then you’re no
You’re in then you’re out
You’re up then you’re down
You’re wrong when it’s right’
Don’t complicate both spectrums of having your crypto all in hot or cold, or some in between convoluted state. Manage both accordingly to your crypto needs and investment goals.
Ballet is a U.S. company that provides simple and secure cryptocurrency storage solutions for the global mainstream market. Ballet is the team behind the world’s first multi-currency, non-electronic, physical crypto wallet. The company was founded in 2019 by Bobby Lee and an international team of cryptocurrency industry veterans. Ballet is headquartered in Las Vegas, Nevada in the United States, and has an office in Shanghai, China.
For more on our products please check us out at: https://www.ballet.com/
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