In the crypto world, I've noticed a phenomenon—many people spend a lot of effort figuring out how to make money, but they neglect asset security. To put it simply, no matter how much money you earn, if you don't know how to protect it, it's all for nothing.

Many newcomers to the space have a vague understanding of hot and cold wallets. Today, let's clarify this.

**What is a hot wallet?**

Official wallets of major exchanges and third-party wallets like MetaMask all fall under hot wallets. Any wallet that can be used online and for trading at any time is basically a hot wallet. The obvious advantage is convenience—buy whenever you want, sell whenever you want, suitable for frequent traders. But there are risks too, because being constantly connected to the internet makes it vulnerable to hackers. Plus, in recent years, there have been numerous cases of small exchanges running away with users' funds. While larger platforms are relatively safer, the risks still exist.

**What is a cold wallet?**

Simply put, a cold wallet is a completely offline hardware device, such as Ledger or Trezor. Private keys never touch the internet, making theft almost impossible. It's especially suitable for long-term holders who keep large amounts of assets untouched for years, as cold wallets provide the most peace of mind. However, they are less convenient for frequent operations—each time you need to connect the device, unlike hot wallets which are more seamless.

**Most common pitfalls**

This is a deadly misconception—some people, after using a cold wallet, store their private keys on their phones or even take screenshots. If the cold wallet gets stolen, there's nowhere to recover the assets, and no one can help you restore them. Hot wallets are like banks—you can contact customer service if funds are lost; cold wallets are like your private vault—you're fully responsible.

So remember this: security is 1, and wealth is the zeros that follow. Without that initial 1, adding more zeros is pointless.