Definition
A cold wallet is a custody arrangement in which the private keys needed to spend cryptocurrency are kept away from routinely connected computing environments. The term describes key management, not a separate location where coins physically reside: the assets remain represented on the blockchain. One workflow uses an online watching-only wallet to prepare a transaction, an offline device to sign it, and the online system to broadcast the signed result. This separation reduces exposure to some remote attacks but does not eliminate unsafe backups, compromised devices, malicious transaction requests, or physical theft. Recovery materials must also be protected because they can recreate spending authority without the original wallet. Moving funds out of cold storage does not inherently require importing its secret keys into an online application. The quality of the signing process, destination verification, and backup procedures matters more than the label alone.
Source references
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