Cold Wallet

How it works. The private key is generated and stays in the isolated environment. To send funds, the transaction is prepared on a connected computer, signed on the cold device and broadcast to the network already signed. To receive, sharing the address is enough; it is derived from the public key.

Types.

• Hardware wallets: physical devices such as Ledger, Trezor, Keystone or Tangem, which sign inside the device without exposing the keys.
• Air-gapped devices: computers or phones that never connect to a network and communicate, for example, through QR codes.
• Paper wallets: keys or phrases written on paper. They are cold, but fragile: they get lost, damaged or copied.

Cold wallet vs. hot wallet.

The connection and the risks are the ones the SEC describes in its investor bulletin of December 12, 2025, which is educational material, not a rule. The usual approach combines both: what does not move stays cold, and a hot wallet holds only what is needed to operate.

Self-custody or a custodian. With your own cold wallet, you practice self-custody: no one else can move the funds, but no one can recover them for you either. MiCA does not apply to providers of hardware or software for non-custodial wallets (Recital 83 of Regulation (EU) 2023/1114). When a company holds or controls its clients' keys, it is instead providing custody and administration of crypto-assets (Art. 3(1)(17)), which only an authorized crypto-asset service provider or another eligible entity may provide (Arts. 59 and 60) and which must comply with Art. 75: an agreement with the client and a custody policy (Arts. 75(1) and 75(3)), client crypto-assets segregated from its own, including on the distributed ledger (Art. 75(7)), and liability for losses attributable to it, capped at market value (Art. 75(8)). Authorized providers are listed in ESMA's interim register. In the U.S., the GENIUS Act excludes from the restrictions in its Sec. 3 any transaction made with a software or hardware wallet that facilitates an individual's own custody (Sec. 3(h)(1)(C)), although the law is not yet in effect.

In a company. Cold storage is usually one layer, alongside multisig or MPC, signing procedures and a recovery plan. We explain it in crypto-asset custody.

Official sources: SEC, Crypto Asset Custody Basics for Retail Investors (Dec. 12, 2025); Regulation (EU) 2023/1114, MiCA (EUR-Lex); ESMA interim MiCA register; Public Law 119-27, GENIUS Act (govinfo).

Framework verified as of October 13, 2026. At Unknown Gravity we design wallets and custody architectures for companies; custody of third-party crypto-assets is provided by an authorized entity. Talk to us.