Secure Your Cryptocurrency Funds with Hardware Wallets
Cryptocurrency traders know that there is a strong need to ensure that their cryptocurrency investments are secure and protected. Hence, there is a strong need for a secure wallet. Cryptocurrency wallets are a key element of the trading and investment process as they act as the real-world equivalent of bank vault where all the money is stored! Choosing a cryptocurrency wallet can be a rather complicated process, particularly in 2018 where a lot of names are emerging rapidly. Let us take a closer look at some of the best cryptocurrency wallets of recent times and see the pros and cons of each.
Before deep-diving into hardware wallets, one needs to understand the two basic concepts on which all cryptocurrency wallets function:
- Public Address: Every cryptocurrency wallet has a public address. The public address can be easily understood as tµhe real-world equivalent of a bank account number. This is a public number that you can provide to people you want to receive payments from. While giving your public address to people is usually quite safe, you must know that anyone who has your public address will be able to see the amount of funds that you have in your wallet.
- Private Key: A private key can be considered as the real-world equivalent of your signature that is used to authenticate transactions from your bank account. In case of a cryptocurrency wallet, private keys are supposed to be kept secret and users must not share it with anyone. It is based on how these keys are held that the type of the wallet is determined. Some wallets allow the users to hold this key while there are others which store them on their servers or third party platforms.
The private key needs to be highly secure. Some wallets store the private key on their server while others use a third-party server to store the key. Most wallet service providers make use of multiple such servers to secure the key. Some wallets allow the users to store the keys on their phone or on their computer – and then there are hardware wallets which store the key in a device that can be disconnected from the computer and stored separately and safely. Let us now take a closer look at understanding what a hardware wallet is:
What is a Hardware Wallet
As observed above, hardware wallets allow the users to store their private key in a separate physical device and do not require to be connected to the internet at all times. The fact that they are not connected to the internet and are a separate device makes it secure because hackers can’t have easy access to it as opposed to other forms of cryptocurrency wallets such as web-based and computer-based wallets.
A hardware wallet is the perfect option for someone who is looking forward for long-term investment on cryptocurrencies as investors can store their cryptos on the wallet and keep it securely disconnected from the internet and protected in a physical locker rather than mobile wallets.
Why should you use a hardware wallet?
A hardware wallet is a very secure solution for storing cryptocurrencies. Taking into account how 2018 has already witnessed over half a billion dollars being wiped out off wallets and exchanges, security has become a key question of concern, now more than ever before. Let us take a closer look at why you should use a hardware wallet and the benefits that it has to offer over regular cryptocurrency wallets:
- The biggest benefit is when it comes to the private key. This key remains in the device and is exposed to neither your computer nor to the internet – and therefore the risk of anyone getting their hands on to the key is minimal.
- Transactions made using Hardware Wallets need a confirmation which can be provided by pressing the key on the wallet – making it extremely secure and ensuring that no one can make a transaction unless they are actually in possession of the device.
- Most of these wallets provide support for multiple cryptocurrencies and almost all major cryptocurrencies are supported by them.
Best Hardware Wallets of 2018
There are several options in the markets when it comes to buying hardware wallets for storing cryptocurrencies. However, the top three names are those of Ledger, Trezor and Keepkey. Some of these brands even have multiple products. However, these are the top three cryptocurrency wallets in the markets that offer the best level of security and support the most cryptocurrencies:
Ledger Nano S
Ledger Nano S is perhaps the most popular hardware wallet on the planet, with over a million devices having been sold across over 165 countries. Ledger supports a large number of cryptocurrencies and is priced in at about $95. One of the biggest benefits of using Ledger Nano S is the fact that apart from being secure, the wallet is also quite easy to set up and use. It comes with a user interface which is simple, even for a first-timer! Low storage space and lack of passphrase support are a problem for Ledger users though.
A portable and convenient hardware wallet for cryptocurrencies, Trezor is shaped like a key. The device comes with several protective measures which ensures that the funds remain safe including two buttons on the device body as well as the support for a passphrase. The device comes with its own software-based user interface which helps the users manage their funds in an effective manner. The device can be a little daunting to set up for first timers and the lack of direct ERC 20 support has been a concern for some users. The device is priced in at $82.
Certainly the most good-looking of the lot, the Keepkey hardware wallet for cryptocurrency storage offers the users with a premium design! It comes with a large screen and is quite easy to use too. A benefit of using KeepKey is that it allows the users to easily trade cryptocurrencies using its own software interface – a service supported by ShapeShift. It also has a good customer support team which is quite helpful. However, the wallet supports fewer coins and can be a little pricier as it comes in at $129.
Good Read Top 5 Bitcoin Hardware Wallets
Ledger Nano S vs Trezor vs Keepkey: How to Choose?
When it comes to Ledger Nano S vs Trezor vs Keepkey, it is often a tough decision to make a final choice as each of them have their own advantages as well as disadvantages. However, while most features are common between the three devices, one’s final decision ultimately boils down to these facts:
- Security features
- The currencies supported by the wallet
- Ease of Use
Hence, while there is no clear answer to which wallet should you buy – but you can make a well-informed choice if you consider the aforementioned factors.
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