Warm Storage is a cryptocurrency account that is semi-exposed to the outside world, only it's public key is known and viewed by users. It is an account that is generally used to store deposits. In the context of Rehive this is the crypto account’s public address (or hdkey for the Bitcoin extension) that the company admin provides from a wallet they control. This is then used to display a deposit address to the end user. In the case of the Bitcoin extension each user will have a unique deposit address and with Stellar the deposit address is combined with a unique memo string to identify which user made the transaction.
It is called “warm” because it sees a quite a bit of public activity in the form of deposits but never has its private key stored anywhere except in an appropriate offline wallet.
- Most of the public keys are exposed to end users and the greater web making it easily visible and a target if its value becomes too large.
- Company admins will be moving funds out of it on a regular basis, making it more prone to human error and mismanagement.