In this article, we will examine why a hardware wallet is the best compromise between security and convenience for many bitcoin owners.
Safety comes first
The most important reason why self-custody is so important with bitcoin is security. By keeping control of your private keys as a user, you minimize the risk of hacks, data leaks and fraud. Hardware wallets provide physical offline storage of private keys, meaning they are protected from most online threats. Compared to software wallets on computers or mobile devices, hardware wallets are less susceptible to malware or phishing attacks.
Everyday Usability
Although security is a top priority, it is also critical that bitcoin safekeeping is practicable. Hardware wallets also do well in this are. The small devices are similar to a USB stick and can be used with computers and smartphones to manage your bitcoin.
Setting up a hardware wallet is relatively easy. The device usually generates 12 or 24 words as a backup for your private keys. You can then sign transactions and store your bitcoin securely without having to deal with complicated technical processes.
Offline Signing for added Protection
Another advantage of hardware wallets is the ability to sign transactions offline. This means that the private keys are never connected to the computer or any other online device.
When a transaction needs to be signed, it's sent to the hardware wallet, where you can approve it with a physical push of a button. This additional protection mechanism minimizes the risk of attacks, even if you have malware on your computer.
If a wallet provider offers a feature that stores your private key at another location (online) in addition to your hardware wallet, we generally advise against using it.
Conclusion
Self-custody is crucial to have full control over bitcoin. In this context, hardware wallets offer the best compromise between security and convenience for most users. With the physical offline storage of private keys and the numerous connection options, hardware wallets allow you to store your bitcoin securely without sacrificing ease of use.
If you want to secure your bitcoin holdings, a hardware wallet is undoubtedly one of the best options available today.
Your Bonus
One provider in the area of hardware wallets that we can recommend is the Switzerland-based company Shift-Crypto, which offers a bitcoin-only hardware wallet called Bitbox02. Because we care about the security of your private bitcoin keys, we have a partnership with Shift Crypto so that you get a 10% discount on your Bitbox with the code 21BTC. We do not receive a bonus for if you use the code. However, it is important to us that our customers store bitcoin as securely as possible.
Not your keys, not your coins.
