Bitcoin can either be stored in hot wallets or cold wallets. Hot wallets are connected to the internet so they can initiate transactions quickly, but as a result, they are exposed to more security risks.
Cold wallets (also called cold-storage) are not connected to the internet directly. Their private keys are stored offline. As a result, transactions from these wallets can't be broadcast instantly and there are more security steps before transactions can be broadcast.
Swan Bitcoin uses a combination of hot wallets and cold wallets to keep your Bitcoin safe, yet accessible. If you do not initiate any withdrawals of Bitcoin, your Bitcoin will be stored in cold wallets. As soon as you withdraw your Bitcoin for the first time, it moved to hot wallet custody thereafter.
For more information about wallets, read here.
For information about how we keep your Bitcoin safe, read here.