The excruciating (but mercifully temporary) inability to log into my cryptocurrency exchange illuminated my need for a hardware wallet to safely store my beloved bitcoin and alt coins. Phone-based wallets exist, but considering the sketchy places I’ve trolled on my phone, it seems a security risk. The safest place to store cryptocurrency is OFFLINE, and that means an unplugged hardware wallet.
A hardware wallet is basically a flash drive. But unlike cheap USB sticks handed out freely at tradeshows and conferences, hardware wallets are more durable and most have additional security features. The most celebrated hardware wallets by nerds in the know are Trezor, Keepkey, and Ledger Nano S.
These three wallets don’t have an operating system, which means they can’t harbor malware. Apparently, they are safe to use even on a computer that DOES have malware. That’s especially important because you may not even know you have malware.
These three wallets have a Liquid Crystal Display screen which also improves security and makes them easier to use. Apparently wallets without LCD screens rely on inputting information into your computer which is sent to the wallet. If your computer is compromised with malware, the information could be stolen and never make it into your wallet.
Physical buttons on the wallet also let you securely navigate the interface – that means, to make selections and enter passwords. Apparently this is a big security bonus because someone who may be controlling your computer remotely is not able to control physical buttons, and therefore cannot control your hardware wallet (i.e. steal from it). From what I read, it appears the Ledger Nano S and Trezor have physical buttons but the Keepkey does not.
Something to note is NOT ALL WALLETS ACCEPT ALL CRYPTOCURRENCIES. And if you’ve read my earliest posts, you’ll know I have a somewhat diverse portfolio. KeepKey won’t support my Bitcoin Cash, ZCash, Ripple or Monero. Trezor won’t support my Ripple or Monero. Ledger Nano S is the only wallet supporting Ripple but won’t support Monero (what’s up with no wallets supporting Monero??).
KeepKey not supporting 4 of my cryptocurrencies and lacking physical buttons eliminated it as a possibility. That leaves Trezor and Ledger Nano S.
Ledger Nano S appears to support all my cryptocurrencies except Monero. Bloggers enthuse about Ledger Nano S’s sleek design but I don’t plan to display it. In fact, I plan to hide it.
I did read something about Nano S only holding 3 currencies at a time, which is confusing. The more I read, the more confused I get. Apparently you can load a currency onto Nano S, then erase it and load another, then erase it, until all of your currencies are loaded but only a few can remain on the stick. I also read that the value doesn’t actually RESIDE on the wallet device, which is also hard to comprehend. The idea of ERASING my digital currency freaks me out. I guess I’ll have to buy a Nano S and try it to see for myself. Maybe I really do need to buy a Trezor wallet too so I don’t have to erase anything from the Nano S.
Bloggers encourage purchasing hardware wallets from Amazon.com and rarely discuss buying from the manufacturer’s Website. I suspect Amazon covertly sponsors many blogs. The trouble with Amazon is the wide price variance for identical products. And many of the vendors have bad ratings, or no ratings, or sell other non-crypto and even non-tech items, which seems unseemly. If I’m buying a device to protect assets worth thousands (maybe hundreds of thousands?) of dollars, I need to believe I’m buying something legitimate.
On Amazon, the Trezor wallet price varies from $99 to $145 – sometimes from the same vendor! A black version is $99, a white version is $94.99 and a grey version is $145. I can’t imagine anyone would care enough about the color of something so few people would see. Upon closer inspection it seems like the grey one with the higher price comes with the USB cable, box, and instruction manual, which could account for the $44 difference.
Some vendors accurately identify the Trezor Wallet’s manufacturer as Satoshi Labs. But one vendor says it’s manufactured by Mom Made Foods. WTF?? I need more confidence in my purveyor of crypto security than that. According to many bloggers, you MUST check if your hardware wallet arrives FACTORY SEALED to ensure someone didn’t compromise it. If it doesn’t come factory sealed, you should send it back and get a refund. Also, don’t buy a used wallet.
Amazon has fewer vendors of the Ledger Nano S, but still a wide and confusing mix of prices and product offerings. Some bundle the wallet with a bunch of (seemingly unnecessary) accessories like a carrying case, lanyard, USB cable, Micro USB adapter, and even a ball point pen for almost $150. Some offer just the Ledger Nano S (no cable, no manual) for as low as $72. Personally, I want a manual, and I’m willing to pay extra for it, but I don’t want to buy a bunch of stuff I don’t need. Unfortunately, I don’t know what is necessary and what is superfluous. I’m also concerned that some of the accessories may be after-market and not as durable as the wallet. I don’t want a cable to fail when I’m transferring my digital currency.
It’s not that I don’t trust vendors on Amazon, I don’t trust people in general and prefer to buy directly from the manufacturer. I’m confident the wallet manufacturers will sell what I need: If I need a cable, they will provide an approved cable. If I need a manual, they will provide a manual.
Although I prefer buying directly from the manufacturer, both Trezor and Ledger are overseas and priced in Euros. They both accept payment in Bitcoin which, ironically, I won’t spend because its value keeps appreciating. If Bitcoin’s value was more static, I would enjoy avoiding my credit card’s infuriating foreign currency transaction fees.
In addition to Bitcoin, Trezor’s Website accepts credit cards, while Ledger’s Website accepts credit cards and PayPal. Both Websites warn their prices do not include taxes and duties. I loathe imagining the hassle of coordinating my schedule with the delivery guy to write a check for the import tariff. I also wasn’t sure where I put my seldom-used checkbook. Buying from Amazon would be so much more convenient. But that nagging voice in my head (which I’ve regretted ignoring in the past) won me over. My distrust of online merchants supersedes my lust for convenience.
I decided to buy only one to see how nightmarish the overseas delivery would be. I chose Ledger because it gave 2 non-Bitcoin payment options, and the Ledger Nano S is compatible with 7 of my 8 cryptocurrencies. I wanted to see if I could in fact store them all together on the one stick or if there really was a 3 currency limit. If I could store them all, I wouldn’t need to buy another wallet. If it truly did limit to only 3 currencies, I would store my Ripple, Bitcoin, and Bitcoin Cash onto the Ledger S, and I would buy the Trezor wallet to store my Ethereum, Dash, Litecoin, and ZCash.
I first tried using my credit card on the Ledger site, but the online overseas transaction triggered a security block. So I tried the PayPal option (using the same blocked credit card) and it succeeded. This seemed illogical but I was glad it worked. A confirmation email claimed I would receive my Ledger Nano S in 3 days. Of course these 3 days fell within the Thanksgiving holiday, complicating calculations of its expected arrival (i.e. when to work at home). The following Monday I was shocked to see it arrived without any attempt to collect taxes, tariffs or duties. I felt stupid for expecting aggravations.
That night I bought the Trezor wallet from the Trezor Website. The Trezor Website doesn’t accept PayPal, so I first called my credit card company for permission to use my card for an online overseas transaction. The transaction worked, and a confirmation email said to expect my Trezor wallet to arrive in 3 to 5 business days by DHL. I’ve never had a good experience receiving shipments from DHL but I hoped for the best, given the success of my Ledger Nano S purchase.
Four days later, a DHL email announced my package’s scheduled arrival by end of day. I was already at work and considered going home to await the delivery, expecting to write a customs/duty check. When I got home I was shocked to see the package arrived without a request for customs or duty. So it seems if you’re in the continental US purchasing from the Ledger or Trezor Website, you can ignore the stern warning about taxes/tariffs/duties.
Now I’ve got to unpack these wallets. I hope setting them up is as effortless as buying and receiving them.