What things mean
This guide can be used without reading this page, skip if desired.
Following this guide may be easier if you have basic knowledge of some things.
The following are simplified explanations of some important concepts related to cold wallets.
🌪 Air-gapped
An air-gapped device is a device that is isolated from any conventional network (internet, LAN, etc) via software and/or physical means.
Note that, while an air-gapped device is incapable of networking, it is still capable of 2-way data transfer via USB, SD Card, etc.
Hardware wallets such as the Trezor One do not have any software capabilities nor any physical circuitry that allow for network interfacing, thus it could be considered an air-gapped device. All data transfers (including firmware changes) occur via USB.
Similarly, a computer lacking the physical hardware to network (WiFi/Bluetooth chip and/or Ethernet port) would also be considered air-gapped.
"Cold" is usually used as a synonym for air-gapped.
❄️🔥 Cold/Hot wallet
A cold wallet is a wallet that employs the air-gapped techniques described above and is not connected to any network.
A hot wallet is a wallet that is connected to a network in some form or another.
🔑 Spend/View key
Monero wallets are made up of 4 keys:
- Private spend key
- Private view key
- Public spend key
- Public view key
What each of these are used for is not too important for the purposes of this guide.
The important thing to take away is that the private spend key is the only key that can spend funds.
When you create a "view-only" wallet in Monero, it is a wallet that has access to all keys except the private spend key, thus it cannot spend funds (but it can see incoming funds just fine).
✒️ Signing a transaction
When you send Monero, you are authorizing a transaction with your private spend key.
Like a check:
- You see who it is going to
- You see how much money is being sent
All that is left is for you (your wallet) to authorize the transaction by "signing" it.
Just like a check with a name and amount, a transaction can be created relatively easily - but without your signature it is not a "real" transaction.
💽 Key Images & Outputs
Again, what these things are is not too important for the purposes of this guide.
The important thing to take away is that the these two things (key images & outputs) are additional pieces of data that must be carried over from cold <-> view wallets in order for:
- The
coldwallet to see an updated balance - The
viewwallet to see outgoing funds