26 Nov, 2018 at 02:23am
Choosing the very best cryptocurrency hardware wallet for you or your business is no easy task. You have to take things like durability, security, ease of configuration and use, accepted currencies and others into account, before making your final decision. In fact, having the best crypto wallet is an abstract notion because each and every wallet comes with its advantages and disadvantages. Some people look for the best security a wallet can provide them. Some want the best privacy they can get. Some are looking for wallets that can accommodate a specific virtual coin or multiple coins.
A crypto wallet, for those of you who are new to the genre, is a virtual or physical device that can store bitcoins and other crypto coins in complete privacy and security. It really is as simple as that. Wallets have been around ever since bitcoin came on the virtual market back in 2009. They were simply virtual wallets at first, after which they expanded to mobile, web, paper and even hardware wallets. Which type is the best? Most people tend to say hardware, but then again, all of them have their merits. You can take a better decision about what wallet to buy after carefully reading about all of them. Not all wallets are secure though, even if they claim they are - a wallet endorsed by McAfee, claiming to be secure, was hacked in 2018.
Mobile wallets store your virtual currency using your mobile phone and specific technologies that will ensure your digital coins are safe from harm. These types of wallets are convenient, easy to use and mostly free to download, as they come in the form of mobile apps. You can easily send or receive bitcoins and other digital assets because of the mobility aspect of the wallet. Most mobile applications that are mobile wallets are compatible with both Android and iOS operating systems, so you won't have a problem on that front when choosing your wallet. The way these wallets are protected from hackers is by a secured two-factor authentication code. Mobile wallets use a copy of the blockchain on your phone, not having to download the entire thing on your device, with the help of a thing called Simplified Payment Verification, or SPV.
A web wallet is mostly a mobile wallet on a desktop or laptop. You still have to deal with an app, but the app is on a computer rather than on a smartphone. The software stores private and public keys and also interacts with various blockchains in order to enable various users to receive and send digital assets and also be able to hold a look on their balance. Bitcoins are mostly stored on web wallets, as are other cryptocurrencies like ethereum, litecoin, bitcoin cash and so on. As with the mobile wallets, web wallets are secure and easy to use, but they still lack a sense of complete security because of the fact they're functioning online. Everything that runs online is at risk of being mingled with by hackers, regardless of how good the security systems behind the apps are. Some browsers, such as Opera, are developing their own wallets.
These wallets are used by big investors and traders. Hardware wallets come in the form of small flash drives or touchscreen devices that enable their users to store digital money in an offline environment. This makes breaking into the devices and stealing bitcoins, for example, merely impossible for hackers. Hardware wallets have an intricate system of protection that uses recovery phrases and physical actions in order to keep digital money safe. This is why most serious traders only work with hardware wallets. Paper wallets work on the same principle, but actually trading bitcoins from these wallets is much harder.
One of the best hardware wallets is the Ledger Nano S. This wallet is created by a company that specialises in hardware products related to cryptocurrencies, ever since 2014. Until now, the company has raised over 85 million dollars from top investors in the crypto field. In January of 2018, the company raised over $75 million in funds to develop their products.
The Ledger Nano S hardware wallet is priced at around $100 per unit. The price has shipping included in almost every corner of the world. As far as the price goes, the Ledger Nano S is the cheapest hardware wallet that has a touchscreen. Whatever you do, do not buy the wallet from places like eBay or other sites, but just from the official website.
The Ledger Nano S comes with a display, which makes it usable even on an infected PC or laptop, for example. In the box, you'll find the device, a micro-USB cable, a neck tag, a keychain and a piece of paper for writing down your recovery phrase. This model comes with two physical buttons which will add an extra layer of security for your digital coins. In order to confirm a payment, for example, you'll have to physically push the two buttons simultaneously. Because of this, no hacker will ever be able to enter your device and steal your bitcoins away.
During the initial configuration, the device will ask for a PIN code. The recovery phrase will help you retrieve your virtual money if you forget the PIN code, but also if the device gets lost or stolen. If someone were to find your hardware wallet, and intend to send the bitcoins on it to their wallets, they will never be able to do this because they'll have to find the PIN code first, which is merely impossible. If the owner of the device enters a wrong PIN code three times in a row, the device erases itself. Make sure the box in which the device comes is intact before opening it. The box has an anti-burglary system that should come to your house intact. If you feel like the box has been tampered with, you need to alert Ledger immediately and ask for a replacement.
The most important aspect of the Nano S, as it happens with all hardware wallets, is to keep your virtual assets and access codes outside the vast world wide web. Bitcoins or any other currencies that are kept on a web or mobile wallet are possible targets for hackers, especially if you're running Windows as an operating system. By using a hardware wallet, which deposits your coins offline, your coins are therefore kept outside the internet and away from the hands of virtual thieves. And because the Nano S allows for a complete backup of your coins by initiating a 24-word recovery phrase, even if your wallets get damaged, lost or stolen, you can immediately recover your money with ease.
The Trezor Model T was launched in May of 2018, so it's a pretty new model on the market. The new version is a much better and functional version of the older Trezor One. The Model T features a coloured touchscreen display, a better processor which will help you trade faster and also the possibility of working with far more cryptocurrencies than most hardware wallets allow for. The device itself looks great, but people are always wondering if the price is well worth it. In the end, it's your decision if you want to buy it or not, as all we can do is to present you with a list of specifications, advantages and disadvantages of the model.
The Trezor One, the original model of the Satoshi Labs company came into existence in 2014. This was the very first hardware wallet for bitcoins on the market. The Model T is just a few months old, but don't let that fool you. This wallet allows for complete protection for your coins and the transactions you'll want to do with them. This is possible because everything happens on an external device first, not on a web app. The private codes are never sent to a computer, and while you can use the Trezor T on a broken computer, it will never get infected because of it.
Here are some of the advantages of using the Trezor T hardware wallet:
Disadvantages of using the Trezor T hardware wallet:
The Trezor T model can support bitcoin, ethereum, bitcoin cash, litecoin and 18 other cryptocurrencies. Also, you can trade with ERC-20 tokens. You can find an up-to-date list of supported coins on the Trezor website at all time. Although the model can withhold the same coins as the original model One, you will be able to use it with other coins soon. For example, the Model T will be the first of its kind to support Monero and Ripple.
Inside the sealed box, you will find the device, a USB to USB-C cable, to recovery phrase sheets, a configuration guide, 4 Trezor stickers and a magnetic dock. The team behind Trezor Model T says that it's crucial that the box arrives sealed at your door, this being the only way they can guarantee the security of their product. Configuring the device is intuitive, so you'll not have any difficulties in having it up and running if you follow the step-by-step instructions in the manual. The recovery phase is extremely important, so make sure you note it down on both of the sheets you'll find inside the kit.
Priced at 129 US dollars a pop, the price of a KeepKey is slightly bigger than that of a Ledger Nano or Trezor One, but much lower than the premium models of the latter two devices. KeepKey is produced by Shapeshift, promising bank-like security for their clients and a very easy to use device.
It's amazing how much the design is worth even if the product we're buying is a hardware bitcoin wallet that, for all intents and purposes, should never be displayed on a bar counter like a mobile phone, for example. A lot of people say that the KeepKey is far more beautiful than all other hardware wallets, which is true if you're comparing it to the Ledger or Trezor. Still, taste is a matter of personal preference, so you might like it or you might not.
As soon as you enter the KeepKey website, you'll find two possible ways of buying this hardware wallet. You can get a simple KeepKey wallet for the price mentioned above. Also, if you're an enterprise working exclusively in the cryptocurrencies market, you can get a bundle of 50 devices for a special price. That way, you can have as many wallets as you want for yourself or your employees to work out on their trades. Although the hardware wallet is made out of plastic, the design is spectacular, almost luxurious.
Advantages of the KeepKey hardware wallet:
In order to configure the device, you'll first need to download the KeepKey Client from the Google Chrome web store. Once you're done with that, open the app and click on Initialise KeepKey. Name your wallet by adding a nickname for it in the next phrase. Don't worry, you can change the nickname at any time you want if you change your mind. The next step is choosing a PIN code for the device, which can be 1-9 numbers long. KeepKey creators advice in choosing a 6-digit PIN code for optimal protection. You'll see a random number on your screen. Find the number you want to use as your first PIN code digit and click on the adjacent square of the set digit. Do this for the rest of your PIN code until you've chosen all the numbers, after which click on Choose PIN to end the setup. You'll have to re-enter the PIN code at the end to confirm it.
Following the PIN code setup, you'll have to carefully note down the recovery phrase. You'll find the special sheet of paper for it in the box. Note every single word that pops up on the screen in the order they come up on the device. This 12-word phrase is a mnemonic representation of your private codes and can save your virtual money if you lose your KeepKey, if it gets destroyed or stolen. Once you're done writing down the recovery phrase, click on the confirmation button and put the sheet of paper in a safe place. That's it, you can now begin to use your KeepKey as your new hardware wallet.
Ledger Blue is the older, more interesting brother of the simpler Nano S model. This hardware wallet for cryptocurrencies was launched in December of 2016. The Ledger Blue comes with a full coloured 3.5 inches touchscreen display, being the most advanced hardware wallet in the game in terms of security, or at least that's what the people at Ledger say about it, along with most of the clients that have bought the device, so it's not just marketing and PR we're talking here.
The price of the Ledger Blue is almost double the one of his smaller brother, so the question is, does this hardware wallet live up to the expectations it creates with the publicity around it? Here are some of the advantages and disadvantages of the device, so you can better understand it and be able to take an informed decision if you want to buy it or not.
Advantages of the Ledger Blue model:
Disadvantages of the Ledger Blue:
The Blue model from Ledger is a hardware wallet that allows for secured deposit and use of your digital money in an impenetrable offline medium. This model is the last one launched by Ledger, coming into existence in the last quarter of 2016. Since its launch, the model has sold more than 10,000 units. As a comparison, the model Nano S from the same company has sold more than 1.5 million units, but the price and the targeted markets of the latter model are completely different from the Blue, which is the high-end product of the company.
The people at Ledger say that "the model Blue is the most advanced hardware wallet on the market in terms of features and configuration. It can execute multiple applications at the same time and comes with encryption capabilities at an enterprise level, everything in a device that's smaller than the palm of your hand. The product is made in France, while the heart of the device is a Secure Element. The device comes with a touchscreen display and USB connectivity."
The Ledger Blue works by generating and isolating private codes for the coins it supports. The private codes are extremely sensitive information for any bitcoins trader, so losing them will end up in you losing the digital money you've gathered over time. Hardware wallets like the Ledger Blue are specially made to ensure you'll never be put in such a harsh situation, preventing such events that can endanger the security of your bitcoins.
Digital Bitbox is the minimalist hardware wallet. This is how the people at Shift Devices AG, the Swiss creators of the device, describe it. The device is priced at a similar point as the Nano, which is 79 dollars US. The model is produced in Basel, being more than a year old now. Whenever you get a Digital Bitbox device in the mail, make sure you receive an unaltered, sealed box before doing anything with it. If the box comes unsealed at your doorstep, the configuration process of your hardware wallet may cost you the integrity of your virtual assets. In the box, you'll find exactly what you would expect from a minimalist product, so the device itself and a microSD memory card.
You will not find any instructions in the box, just a link towards a site where you'll get to read about the steps you need to follow in order to configure your Digital Bitbox. The first thing you have to do is to download the app. Once that's done, install the app on your computer. Afterwards, connect the hardware wallet to the computer by inserting the device into one of your available USB ports. Do this only after you insert the microSD card into the device. Open the app and enter the information you're requested for the configuration process. The app will install the wallet and will generate a backup on the memory card from inside the device. You can send virtual coins to your wallet using the address from the Receive tab of the application.
Advantages of the Digital Bitbox hardware wallet:
Disadvantages of the minimalist wallet:
Remember the password you're about to add at this stage. Without it, you will never be able to access the virtual money stored on your wallet. Write the password down on a piece of paper and store it in a secure place only you know about. Without the password, you'll never be able to access the Digital Bitbox itself, nor the backup it creates on the memory card. After you've successfully followed all of these steps, remove the memory card from the device and store it in a secured place, as the backup can easily help you recover your bitcoins, should your device get lost or stolen.
For the price the producers are asking for it, you can't say anything else about the Bitbox other than it is a decent hardware wallet which comes with some impressive features and is doing great regarding security. The fact that the entire wallet can be saved with a backup and stored separately is a unique feature the wallet offers, different from all of the other competitors on the market. Probably the biggest letdown of the Digital Bitbox is the fact that it supports just two digital coins, bitcoin and ethereum. On the ethereum side, it can hold ERC20 tokens that are compatible with the Ethereum blockchain.
It is also worth mentioning that the touch button can sometimes be hard to press. Also, the fact that a USB cable is missing from the box can be a problem if you're using a desktop PC, not a laptop, and have to introduce the device in the back of the central unit every single time you want to open it up.
Opendime is a USB flash drive on which you can put bitcoins if you're the first user of the device, after which you can literally pass the bitcoins to the next user manually, which can also pass the virtual coins to the next third user, and so on. The private code attached to the device is internally generated during configuration. The code stays a secret for everybody, even for the Opendime platform, which has no access to it. The device can be moved from one person to the next, and also verified countless times. An Opendime stick can be restored only by the first user, who has to actually break into the device to get to the privately generated access key and then transfer the content of the Opendime into a different web wallet.
Opendime is priced at $37.5 for 3 devices. Being a bit too hard to use because of the technicalities of the process, but also a bit expensive for carrying small amounts of virtual money around, the Opendime is perfect if you're a top investor who wants to pass their bitcoins from hand to hand.
Transactions with the Opendime device are a tad different from the normal ones on the blockchain. When two people meet and exchange goods or services for an Opendime USB flash with bitcoins on it, you can literally say a transaction had just taken place. Still, the transaction will never be recorded on the blockchain. This is the main difference between the Opendime and any other normal bitcoin wallet, be it hardware, mobile, web or paper, which automatically uploads the transaction on the blockchain because it takes place between itself and another address on the network.
These transactions are stored and can be accessed by anyone at any time. With Opendime, nobody will ever know where the device is at a certain point, nor who is in possession of it and the coins that are stored on it. With that, Opendime is the first and only anonymous hardware wallet on the market. You can achieve something similar with a paper wallet, for example, printing the bitcoin address and the access key and giving the paper to another user, without the transaction being registered on the blockchain.
Advantages of the Opendime wallet:
The users of an Opendime can choose to send the stick from one person to the next just a few times before the device is emptied and destroyed. They can also treat the device as being physical interpretations of the bitcoins themselves, which they can also send from one person to the next as currency in exchange for goods or services. Both these scenarios are implemented by the Opendime users on a daily basis, bot for small businesses and exchanges, but also for keeping the bitcoins safe for years and years on end.
Opendime is a company forged by Coinkite operating from Toronto, Canada. The creators of the device say that their stick will last for a lifetime, but because Opendime hasn't been around for more than a decade, you can't be certain of this. The Opendime flash drives are impossible to counterfeit, coming with a security chip that's unique to the product.
If you have invested a sum that you don’t want to lose, that’s over the price of the device itself, it’s extremely important to look into a wallet you can trust. Sure, web or mobile wallets are secure enough, but that’s sometimes not good enough. If you're serious about trading with cryptocurrencies and making it big into this beautiful world of digital investing, you're most likely going to want a hardware wallet you can use to safely store your digital assets.
Your wallet is as important as the currency it holds within itself, so don't cheap out and make sure you buy a hardware wallet you can use for years to come and that will keep your digital fortune away from malicious hands.
Image Credits - Citowise, CryptoPotato, Buy BItcoin Worldwide, Ledger, Quick Penguin, Opendime, Bitcoin Wiki