5 Best Hardware Wallets: [The Most Comprehensive List] – Blockgeeks
Hardware wallets are one of the most convenient and safest options out there for storing your cryptocurrency. A hardware wallet is a type of cryptocurrency wallet where you can store your private keys in a secure physical device. The cryptocurrencies stored in the wallet are kept offline, meaning that they can’t be hacked. However, when needed, the coins stored are readily available. If you are not that well-versed in coding and technical details, the hardware wallet is a great way to store the majority of your cryptos.
Before we go any further let’s take a more in-depth look into the different types of cryptocurrency wallets.
What are cryptocurrency wallets?
When we hear the word “wallet,” we often think of a pouch wherein we can store physical money. Cryptocurrencies don’t have a digital form and the way we control the flow of these coins is via our private keys and public addresses.
In a standard wallet, we can perform two functions:
- Put the money inside the wallet to store it.
- Take the money out of it to give it to someone else.
- Your public address is where people can send you your crypto.
- You can unlock your crypto and use it any way you want with your private key.
A cryptocurrency wallet is a program or a device that stores your public address and private key. It can also be used to receive and spend your crypto. The wallets can be broadly divided into the following categories:
- Hot wallets.
- Cold wallets.
These are crypto wallets that are actively connected to the internet. While it is easy to transact using these wallets, they are vulnerable to hacks. Exchange wallets, mobile wallets, and desktop wallets are examples of hot wallets.
Cold wallets are crypto wallets that are not connected to the internet and hence safe from hack attempts. Paper wallets are an example of cold wallets. The idea is that if you want to store away and hold on to your cryptocurrencies safely, then you can use a cold wallet to keep them safe.
Hardware wallets combine the safety of cold wallets, along with the ease of transactions of hot wallets.
Bitcoin hardware wallet details
Hardware wallets are physical devices, which act as a flash drive and store your private keys. The device is secure enough that you can even use them with a device you don’t trust. The best things about using hardware wallets are:
- You will keep the wallet disconnected in your pocket or bag at all times. This makes sure that the wallet is off the net and cold.
- Whenever you need to send your crypto, you simply connect the wallet to a computer or a device, enter your PIN-code and send the funds. The moment the transaction is completed, you disconnect it and keep it in a safe place.
How hardware wallets secure your private keys?
The most important thing that you must remember is that the private key never leaves the hardware wallet. The entire transaction validation process is done within the hardware wallet itself and not on the computer. Traditional offline wallet clients only use the private keys from your regular hard drive or device storage. Unfortunately, what this means is that they are easily available and vulnerable to attacks. You can always store the private keys in an encrypted hard drive, but to use that you will need to decrypt it, which will instantly make your keys vulnerable.
Hardware wallets, on the other hand, don’t expose the private keys even during transactions. Here’s a brief description of how it works:
- The hardware wallet will ask the wallet software running on your computer or smartphone to provide the payment details like the requested amount and target address.
- The moment the hardware wallet receives those details, they will await user confirmation, sign the transaction, and then eventually send back a digital signature to the software. This will complete the transaction.
Hardware Wallet Disclaimer
The graph below shows you a breakdown of the biggest perceived threats for crypto:
Credits: Trezor Blog
With a whopping 66.30%, remote attacks take the cake when it comes to the biggest perceived attacks in crypto. The primary purpose of a hardware wallet has always been to protect users and funds against malware attacks, computer viruses, and various other remote dangers.
Having said that, hardware wallets are not 100% safe. As with any other wallets, they are still susceptible to the “$5 wrench attack.” If you are unaware of this attack, then check out this fun little comic by
1) Q: What are cryptocurrency wallets?
2) Q: What are hardware wallets?
3) Q: What is a hot wallet?
4) Q: What is a cold wallet?
5) Q: What are the top 5 hardware wallets?
- Ledger Nano S
- Ledger Nano X
- Trezor One
- Trezor T