# Hot Wallet

*Crypto & Digital Assets — Finicade finance glossary*

A hot wallet holds keys on an internet-connected device, trading security for the convenience of actually being able to transact.

A hot wallet holds keys on an internet-connected device — a phone, a browser extension — trading security for the convenience of actually being able to transact. The standard practice is a small hot balance for daily use and cold storage for the rest, the digital equivalent of a wallet and a safe. Most losses happen not by key theft but by signing a malicious contract approval.

**Also known as:** software wallet, browser wallet, MetaMask

**Related terms:** [Cold Storage](https://finicade.com/glossary/cold-storage), [Private Key](https://finicade.com/glossary/private-key), [Seed Phrase](https://finicade.com/glossary/seed-phrase), [Smart Contract](https://finicade.com/glossary/smart-contract), [Decentralized Exchange (DEX)](https://finicade.com/glossary/decentralized-exchange)

Source: https://finicade.com/glossary/hot-wallet