When we talk about the wallet, we think about the secured wallet, and there are third parties that provide the wallet service, which is called exchanges. Exchanges are centralized systems, and you know, a centralized system can hack due to their security issues, and you can lose your bitcoins stored on the exchange wallet.
I am not saying all the exchanges can be hacked, but some exchanges provide a high level of security. If you want to secure your bitcoins, go with the offline wallet that cannot be hacked, named hardware wallet.
A hardware wallet is the most secure form of storing bitcoin for the long term. Buy bitcoins or other coins from the exchange and then transfer them to the offline wallet, i.e., hardware wallet.
So in this article, we will talk about the hardware wallet and the main reasons that make it more secure than another wallet. In this article, we will tell you how to secure your bitcoin and if you want to buy bitcoins, click here.
What is a hardware wallet?
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As the name shows, hardware wallets will store your bitcoin in the hardware system, i.e., it is an offline device that can touch, and you can easily carry it into your pocket. Hardware wallets are the most secure wallets than other wallets.
It is the same as the USB, and you can store your bitcoin or other crypto coins in this USB hardware. Just plug this system into your CPU or laptop, and you will get all the information, i.e., bitcoin amount or any update regarding your bitcoin.
A hardware wallet is like physical storage, and it contains the public key and private key. Since the hardware wallet is offline, no one can steal your private key, even a professional hacker. Your private key is stored in a USB or hardware wallet.
If your computer is connected to the internet, it will not affect your privacy. There are various forms of hardware wallets that contain multiple features and may vary in price, and you must choose a wallet that will include a built-in backup feature.
Why are hardware wallets secure?
What makes the hardware wallet more secure than other wallets? Well, the name describes all the features. It is a hardware system that stores your bitcoin safely even if you are connected to the internet because your private keys (essential key to transfer your bitcoins to another wallet) are offline stored into your portable hard drive, and hackers cannot access it.
The main thing that makes the hardware wallet more secure is it is offline and its portability. Hardware wallets are offline, and it will not affect your privacy even if you are connected to the internet because your secret key is stored in a portable device, i.e., a hard drive. It is portable, which means you can carry it in your pocket and if you want to transfer it, you have to plug it into the computer or laptop.
The essential thing that makes hardware wallets more and more secure is 2FA (Two Factor Authentication). 2-factor authentication means you have to enter the PIN before accessing your bitcoin wallet. It provides higher security.
No one can crack your PIN (Personal Identification Number), and it is the same as when you enter an ATM PIN for banking services like withdrawal or deposit, etc. You can set a four-digit PIN while creating your hardware wallet and keep it secret to avoid losses.
Pros and Cons of Hardware Wallet:
- It provides a high level of security, and the private key is offline stored into your hard drive or hardware wallet so no one can hack your hardware wallet.
- If your computer got affected by malware or another attack, the hacker could not access your hardware wallet due to two-step authentication.
- The private key is never transferred to other devices and is challenging to find for the other person because it is stored in your hardware wallet, and you can plug it out any time from your laptop or computer.
- The most significant benefit is that the hardware wallets are portable, which means you can take it with you and spend it by plugging it into a computer or laptop.
- The transactions are easier than paper wallets.
- It is too expensive even then software wallets price starting from $60 and varies according to the features.
- There might be issues regarding the hardware failure that means you can lose your coins.
- Different wallets can store other cryptocurrencies, and if you want to keep specific, you have to research before purchasing a hardware wallet.
- Difficult to trust the supplier because hardware may be used by another person that will cause hacking, cracking or other issues.