Hot storage
Hot storage is a technique of storing cryptocurrency that involves keeping the private keys online and connected to the internet. This differs from cold storage, where private keys are kept offline on a device like a hardware wallet.
Hot storage is often used by crypto exchanges and other platforms that require immediate access to funds for transactions. However, this method is more susceptible to hacks and other security breaches since it is connected to the internet. Hackers who gain access to the platform’s hot wallet could steal the assets stored there.
To minimize this risk, cryptocurrency platforms usually implement additional security measures like multi-factor authentication, encryption, and other safety measures to prevent unauthorized access.