What is the difference between a hot wallet and cold storage?

The difference is internet exposure. A hot wallet runs on a device that is online, which makes it convenient for everyday use but reachable by malware and phishing. Cold storage keeps your private key offline, on a hardware wallet or an offline machine, so a remote attacker cannot touch it. Hot wallets suit small, frequently moved amounts; cold storage suits larger balances you intend to hold. Many careful holders use both, keeping spending money hot and sweeping the bulk into cold storage. Matching the storage type to the amount and how often you use it is a core security skill.