Cold storage is the practice of keeping cryptocurrency assets offline to protect them from hacking, theft, or unauthorized access. It typically involves hardware wallets, paper wallets, or air-gapped devices that are not connected to the internet. By storing private keys offline, users reduce the risk of digital attacks compared to online wallets or exchanges. Cold storage is commonly used for long-term holdings or large amounts of cryptocurrency. While it offers enhanced security, it requires careful management to avoid loss of access.
Following a catastrophic hardware wallet exploit affecting Coldcard devices, a volunteer security coalition known as the Bitcoin Red Team executed a massive AI-assisted security audit across 390 open-source Bitcoin repositories.