Hardware Wallet Definition
What are Hardware Wallets?
A hardware wallet is a physical device for cryptocurrencies that stores private keys which enables you to securely store your crypto assets.
There are two primary ways to store your crypto assets. The first is through a software wallet.
This is the most traditional and common means to store cryptocurrencies. Software wallets are
notoriously secure, due to the nature of cryptocurrencies. But many have found that they’d like
their assets to be even more secure. Hardware wallets can provide this extra level of security.
Software wallets are advantageous over software for a couple of different reasons. First, a
hardware wallet cannot be hacked like a software wallet can. Software wallets are vulnerable to
computer viruses which can damage or steal the private key. Hardware wallets, when kept
secure, are safe from viruses.
While hardware wallets are extremely safe, especially compared with software, there are some
security risks to know about. There is no form of protection against hackers greater than
knowledge. Be sure to learn about the various loopholes in the system in order to keep your
cryptocurrencies secure.
Systems for Safety
For example, it’s still important to know exactly who you are sending your crypto to. Hardware
wallets do not prevent scams. Also hardware wallets can be compromised at the level of
implementation. A bug in the computer software can provide a hacker access into the hardware
wallet.
There are many different kinds of cryptocurrency hardware wallets. Some are bigger and bulky,
while others look like USB sticks. Some even look and work like credit cards.
Ledger makes a number of great hardware wallets. For example, the Ledger Nano is a USB
smart card hardware wallet that plugs into the USB port in a computer. It has an easy user
experience and is compatible with various third party applications. The Ledger Nano is useful
because the encryption is within the wallet itself, meaning you can even open the wallet on a
computer you don’t trust.