What are Hardware Wallets

Since software crypto wallets could be more susceptible to being violated, hardware crypto wallets are becoming increasingly popular in the crypto community.

By Radhika Parashar | Updated: 28 June 2022 16:54 IST

Photo Credit: Unsplash/ regularguy.eth

Hardware crypto wallets, secured by PIN codes, can erase all data after failed access attempts

Highlights

Hardware crypto wallets are becoming popular among industry members
People can recover lost information if hardware wallets are lost, damaged
Hardware crypto wallet users need to be careful about keeping it safe

Brian Armstrong, the CEO of Coinbase crypto exchange, recently said that very soon, smartphone brands will have to integrate hardware solutions for digital asset holders, as the sector continues to see adoption and expansion. Since software crypto wallets could be more susceptible to being violated, hardware crypto wallets are becoming increasingly popular in the crypto community. These gadgets, that store private information about crypto wallets, often resemble a pen-drive or a small-screened VPN key. The price of these hardware crypto wallets can range from Rs. 1,000 to Rs. 50,000.

Industry players from the crypto sector are known to believe that crypto hardware wallets provide the highest level of security against scams and hacks.

Since they are self-custodial, its users are not reliant on any crypto exchange or wallet provider to save their private keys in their systems, making them vulnerable target for hackers.

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Private keys open the lock to your wallet address where your assets actually live.

Hardware crypto wallets do not store your cryptocurrencies. Users can simply store their private key information on their hardware crypto wallets, and keep the custody of their private keys with themselves. The crypto assets, continue to exist on the blockchain.

The wallet gadget itself is secured by a PIN – and the device can be customised to erase any uploaded detail after several failed access attempts, thus preventing physical theft.

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If a hardware wallet damages or breaks, the users can enter into their recovery phases on another new device to recover full access to their crypto holdings.

Ledger, the France-based hardware crypto wallet company, recently said that it is trying to inform as many people as possible, about the uses of private and self-custodial crypto wallets.

In fact, last week, Solana Labs revealed that their Web3-focussed smartphone named ‘Saga' will feature an in-built crypto wallet as part of the device itself. This will enable users to turn their smartphones into hardware crypto wallets.

Hardware crypto wallets, while safer than server-based offerings, are not a hundred percent secure in-terms of safeguarding crypto assets.

While there is always a chance of losing the hardware wallet, there are also many scammers that attempt to trick users into giving them the private keys to their wallets.

Ledger Nano S, Trezor Model One, SafePal S1, and D'Cent biometric wallet are have been named under the best offerings in the hardware crypto wallet category.

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Further reading: Cryptocurrency, Crypto Wallets, Hardware Crypto Wallets

Radhika Parashar

Email Radhika

Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More