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Holding bitcoin can be simple, but finding the right hardware wallet to store your coins can be tricky. Web and mobile wallets are usually preferred but have a risk factor of your coins being stolen through cyber hacks or phishing scams. Therefore, hardware wallets are the most secure option when it comes to storing your bitcoin.
In this guide, we will explain how hardware wallets work and list some of the most popular bitcoin-only hardware wallets in the market.
What Is a Hardware Wallet?
A hardware wallet is an encrypted portable device that is used to store your cryptocurrency in cold storage. However, it is not your coins that are stored directly on the device but the private keys that give you access to the coins that remain on the blockchain. Through a hardware wallet, you can conveniently manage your private keys and take self-custody of your assets.
Hardware wallets are effective in securing your crypto by giving you an extra layer of security against hacking, phishing sites, and malware. A hardware wallet, which often comes in the form of a USB device, enables you to access your crypto from anywhere. You can plug a hardware wallet into your computer and manage it through its proprietary software to interact with decentralized applications, as well as send and receive cryptocurrency.
Moreover, hardware wallets can support multiple digital assets simultaneously. For your convenience, different crypto assets can be backed up by a single recovery phrase. The recovery phrase can be used to access your cryptocurrency if your device containing your private keys is destroyed or stolen. That is why it is important to keep a copy of your recovery phrase and store it safely.
Why You Should (Probably) Use a Hardware Wallet
The main advantage of using a hardware wallet as opposed to a software wallet is that your entire bitcoin holdings remain offline. Remember, most theft and scams involving crypto assets happen because the web and mobile wallets are directly or indirectly connected to the internet by default.
When using a hardware wallet, the likelihood of being hacked reduces significantly since it’s a separate device where cryptocurrency transactions are manually and physically signed on the device itself. Only the cryptographically signed transaction hits the internet.
Hardware wallets also often possess extra security features like Two-Factor Authentication, a lock PIN, biometric security, and more. Moreover, the wallet device typically has a display that allows you to enter your PIN as well as confirm your address when transacting.
How to Use a Bitcoin Hardware Wallet
Using a Bitcoin hardware wallet is not that complicated, although they l differ from one manufacturer to another.
- The obvious first step will be to set up your hardware wallet. To do that, you will have to buy a hardware wallet from the device manufacturer. You should do the shopping for the device directly on the manufacturer’s website. Only then can you make sure that you do not buy a manipulated version of a hardware wallet. You can also order a bitcoin hardware wallet on a trusted e-commerce platform like Amazon though this opens you to some degree of counterparty risk as the wallet could potentially be manipulated.
- Once you obtain the physical device, you then proceed to install the custom software that will assist you in setting up your wallet. This you can do by connecting the USB device to your computer. Once the hardware wallet application is running on your PC, several prompts will be issued for you to follow.
- Begin the setup process and follow the prompts to their conclusion. At some point, you need to set a PIN code or receive one. Ensure you securely write down your PIN code so you won’t forget. Equally, be sure to write down your recovery phrase and store it offline in a secure location or several locations. The backup of the recovery phrase will make sure, you will always be able to restore your assets.
- The application will then go on to create the wallet address that you can use to send and receive bitcoin. To transfer your bitcoin to your hardware wallet, copy your wallet address from the app’s front end and paste it into the sending tap within your sending wallet. Initiate the transaction, whereupon you will see the transaction details appear on your hardware wallet.
- You can then check the display on your device that is connected to the PC to confirm the transaction details are correct, and that you are sending your bitcoin (BTC) to the correct recipient wallet. Only if everything is correct, push the button on the hardware wallet to finalize the transaction.
In this example, we are assuming you are using a USB-stick-like hardware wallet device that comes with a display. However, hardware wallets come in all shapes and sizes, so the setup process can vary quite substantially, and some hardware wallets don’t really require any setup at all.
Popular Bitcoin-Only Hardware Wallets
Now, let’s take a look at some of the most popular Bitcoin hardware wallets in the market.
Bitbox02
BitBox02 is a Swiss-made hardware wallet that offers a special bitcoin-only edition to its users. The hardware wallet is a product of Shift Crypto AG, a Zurich-based private company responsible for all BitBox products. BitBox02’s bitcoin-only edition hardware wallet is only compatible with BTC.
The hardware wallet has a sleek minimalistic design with in-built touch sensors around its edges. The device is approximately 54.5 x 25.4 x 9.6 mm in size, including a USB-C plug. It weighs 12 grams and is made out of Polycarbonate. BitBox02 bitcoin-only edition is compatible with Windows 7+, macOS 10.13+, Android, and Linux.
BitBox02 provides state-of-the-art security features, including a dual-chip design to add an extra layer of security for your bitcoin. Its source code is open source and has been fully audited by security experts for vulnerabilities. You can also connect to any Electrum server using BitBoxApp. Moreover, BitBox02 supports Electrum, HWI, JavaScript, Python, and more.
Features:
- USB connectivity
- Mobile support for Android devices
- Easy backup and recovery with a MicroSD card
- Amazon price – $149
- Memory storage – 16 GB
Blockstream Jade
Blockstream Jade is an easy-to-navigate hardware wallet used to secure your bitcoin and Liquid assets. The wallet is a product of Blockstream, which is a leading Bitcoin technology provider.
The Blockstream Jade hardware wallet has dimensions of 60mm x 24mm x 17mm. The hardware device has a full-color 240×135 pixel 16-bit display. You can use it to display QR codes on the device as well as to send and receive transactions by verifying addresses and transaction details on the display. The device also has a click-wheel application button and a battery capacity of 24 mAh.
As with any other hardware wallet, Blockstream Jade stores the keys to your bitcoin and Liquid assets offline. You can improve your security by utilizing Blockstream’s Green Multisig Shield technology. You can also gain access to full-node verification and Tor support. Blockstream Jade wallet supports Windows, Android, Linux, and macOS through Blockstream Green’s platform.
Features:
- USB & Bluetooth connectivity
- Mobile support for Android
- Amazon price – $49
- Memory storage – 4 MB
Card Wallet
Card Wallet provides a simple way for you to securely store your bitcoin offline using a tamper-proof card. Card Wallet is developed by Coinfinity and the Austrian Printing House, with the former providing the technology and the latter being responsible for the manufacturing.
Card Wallet uses high-quality security materials and fortified features to prevent any form of card manipulation by bad actors. The private key is sealed in a tamper-proof manner at the back of the Card Wallet before the card leaves the production machine without staff ever seeing the keys.
The card wallet’s dimensions are similar to that of a standard debit card of 85mm x 54mm. The card is made up of polycarbonate, a laser-imprinted private key, and has a bitcoin address etched into it. You can order a Card Wallet Bitcoin for only € 39.90. Please note this excludes shipping charges.
Features:
- Very easy to use
- Price – € 39.90
Coldcard
Coldcard is a bitcoin-only hardware wallet that allows you to avoid ever being connected to a PC for its entire life cycle, from seed phrase generation to transaction signing. The hardware wallet is developed by Coinkite, a leading security and hardware manufacturer based in Toronto.
Coldcard has a numeric keypad that makes it easier to enter your PIN. You can view your transaction details on its bright, 128×64 pixel OLED screen. The wallet has a seed plate with dimensions of 12.7×7.62 for easy storage and concealment. To further secure your bitcoin, Coldcard stores your private keys in dedicated security chips and not on the microSD.
Since Coldcard devices are based on BIP174, interoperability between wallets is possible. Coldcard uses dual microchips to store your 24-word seed phrase for your BIP39 wallet. Coldcard wallet has a duress PIN feature that generates a different private key during tricky situations and keeps your main private key safe.
Features:
- USB connectivity
- Easy backup through a MicroSD slot
- Price – $147.94
- Unlimited memory storage
OpenDime
OpenDime is a bitcoin-only hardware wallet that acts as a read-only USB flash drive. OpenDime is a product of Coinkite, the same company behind the Coldcard wallet. OpenDime works with any PC, laptop, or mobile device.
OpenDime secures your bitcoin by generating the private key within your device that no one has access to, not even you. OpenDime employs bitcoin message signing, standard bitcoin payment addresses, and private keys in WIF format. Each OpenDime wallet holds a single private key and doesn’t reveal the key until “unsealed”.
Features:
- USB connectivity
- Mobile connectivity to Android and iOS
- Price – $69 per pack
Hardware wallets are your go-to option for securely storing your bitcoin holdings long-term. Which type of hardware wallet is right for you and your level of technical expertise is up to you. So you should probably test a few to find the one that suits you best.
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