Cold wallets, on the other hand, are what you need to use if you want to store more of your crypto for longer periods. ‘Cold storage’ refers to the wallet not being connected to the internet in any way. This is by far the most secure way to store your coins and most crypto exchanges will now warn their customers of this. If your coins are stored offline, however, they will likely be hard to access. Thus cold storage is best for those seeking to hold their crypto for months or years at a time. Most of the biggest crypto exchanges will keep the vast majority of their wealth stored away in cold wallets such as paper wallets or hardware wallets. Setting up cold wallets can be a little intimidating or confusing for beginners, so many choose to keep their coins on exchanges or in ‘hot wallets’, however, if you are careful and patient it can be done quite easily.
One of the safest ways to store your crypto-coins is in a hardware wallet. These are physical devices, usually made to store one or several different cryptocurrencies. Hardware wallets are often designed to look like small USB devices, and your private key is actually stored within the device using cryptography. Hardware wallets can be easily lost or damaged as they are often small, yet they can be backed up like most other wallets, and so if this does happen you may be able to restore your wallet. Some popular hardware wallets on the market are Ledger Nano S. and Trezor, to name a couple.
By far the safest way to store your crypto is in a paper wallet. If you keep your money on a paper wallet then you have to be extra careful not to misplace or damage your private key. When you make a paper wallet, you print out your public and private keys for storage on a piece of paper. They keys are usually printed as QR codes, which the user can scan whenever making transactions. Paper wallets are set up using an open source program to randomly generate a unique public and private key. They keys are generated offline to rule out any chance of attack.