close
close
LearnIntro to Web3
How to use a cold wallet?

How to use a cold wallet?

March 17, 2022
3
 min read

A cold wallet is more secure than a hot wallet because it stores your seed phrase in a hardware device that's offline.

By Peter

A cold wallet is more secure than a hot wallet because it stores your seed phrase in a hardware device that’s default offline.

We recommend that you get a cold wallet if you’re serious about crypto. It costs about $100 but is worth it to protect your assets.

In this guide, we'll cover:

  1. What is a cold wallet?
  2. How to use a cold wallet?
  3. How to connect with a hot wallet?
  4. Cold wallet best practices

What is a cold wallet?

The Best Bitcoin Wallets of 2022

We covered why you must protect your seed phrase at all costs in our guide on how to use a hot wallet. Whoever gets your seed phrase can drain all the assets.

In a hot wallet like Metamask, your seed phrase is stored on your internet-connected computer. Unfortunately, that means that it’s liable to get hacked or phished. 

In a cold wallet like Ledger and Trezor, your seed phrase is stored in a separate hardware device that’s default offline and much harder to hack.

How to use a cold wallet?

Here’s how you can set up and use a cold wallet. We’ll use Ledger as an example:

  1. Turn on your cold wallet and follow the on-screen instructions. You’ll need to create a PIN code to access the wallet.
  2. Write down the 24-word seed phrase and store it somewhere safe. Consider keeping multiple copies on paper.
  3. You might need to install apps on your cold wallet to access different cryptocurrencies, NFTs, or other digital assets.

Check out the official Ledger Nano X setup guide for more information.

How to connect with hot wallet?

Connecting your cold wallet to a hot wallet reduces the friction of using the former. For example, you can connect Ledger to Metamask:

  1. In Metamask, select “Connect Hardware Wallet” from the profile screen
  2. Plug your cold wallet into your computer and select Ledger
  3. Follow the on-screen instructions

Once you connect your cold wallet to Metamask, you’ll need to confirm every transaction by pressing a button on your cold wallet. Although this process requires more work, it’s worth doing to secure your funds.

Check out the Metamask + cold wallet setup guide for more information.

Cold wallet best practices

Here are some more best practices for using cold wallets:

  1. Your seed phrase is more important than the actual device. If your cold wallet breaks, you can always recover your assets by importing your seed phrase on another wallet.
  2. Don’t load your hot wallet seed phrase on your cold wallet. The whole point of the cold wallet is to store a seed phrase offline. Loading a hot wallet seed phrase on your cold wallet defeats that purpose.
  3. Avoid cold wallet phishing attempts. Only buy a cold wallet from the official Ledger and Trezor sites. Don’t respond to fake support emails or DMs asking for your seed phrase.

Now that we covered hot and cold wallets, let’s dive into how you can avoid wallet scams.

Up next: How to avoid wallet scams?

Learn more

Subscribe to our newsletter
Oops! Something went wrong.
On this page

What is a cold wallet?

How to use a cold wallet?

How to connect with hot wallet?

Cold wallet best practices

Learn more

Related articles

Browse all

Prev Article

🤷

There are no previous articles in this Pathway

Check out other Learning Paths!

Next Article

🤷

There are no more articles in this Pathway

Check out other Learning Paths!