Any custodial fintech splits its crypto holdings between HOT wallets (private keys online, can broadcast immediately, low operational friction, high security risk) and COLD wallets (keys air-gapped, requires multi-signer offline ceremony to broadcast, high operational friction, near-zero theft risk). Best practice: keep 5-15% of customer holdings hot (enough to satisfy daily withdrawals), the rest cold. As deposits accumulate or withdrawals drain hot, you REBALANCE between the two. Each rebalance is a chain transaction that hits a network fee and gets booked as an asset reclassification, not a P&L event. This lesson posts a cold-to-hot rebalance.