Owning cryptocurrency comes with great responsibility.
According to Wikipedia in 2018, around $1.7 billion in cryptocurrency was lost due to scams theft, and fraud. In the first quarter of 2019, the number of such losses was $1.2 billion.
Unfortunately, in most cases it is almost impossible to get the stolen funds back.
So, how should you handle such situation?
This article will teach you how to keep your cryptocurrencies safe and will help you to choose suitable hardware storage accustomed to your needs.
Firstly, we will discuss what hardware wallets are and how they work.
If you are already familiar with the essence of hardware storages you can directly skip to Trezor vs Ledger review.
Without much fuss, let’s get into it.
- 1 Hardware Wallet: Everything you need to know
- 2 Trezor vs Ledger Ultimate Review
- 2.1 Trezor vs Ledger: Physical appearance
- 2.2 Trezor vs Ledger: Durability
- 2.3 Trezor vs Ledger: Cryptocurrency support
- 2.4 Trezor vs Ledger: Security
- 2.5 Trezor vs Ledger: Pricing
- 2.6 Trezor vs Ledger: How to buy
- 3 Conclusion
Hardware Wallet: Everything you need to know
Once it comes to finances, safety and ownership are the main leading factors to look out for.
With Hardware wallet, unlike the banks, you are in charge of your own funds.
No third parties and no authorities.
Below, you will read answers to the most frequent questions people ask about Hardware Wallets.
What is Hardware Wallet?
The Hardware wallet is an electronic device built to keep your Crypto assets secured.
They allow users to privately store their coins on blockchain with no need of any Crypto exchange.
It contains an offline private key. Making it invulnerable to online attacks and immune to malware.
Hardware wallets are also known as cold storages (or cold wallets).
How does Hardware Wallet work?
In order for you to use cold wallet, you need to connect it to any type of device that has internet connection like computer, phone or tablet.
In most cases, you need to download a program to interact with the hardware wallet.
The program will help you to customize your portfolio and view and manage the transactions.
Before activating your cold storage, you will need to write down the combination of the provided 12-24 safety words. These words will be your seed phrase.
Make sure to always keep your seed phrase offline and somewhere safe.
Storing it online can easily get it compromised and have your Cryptos stolen out of your wallet.
Remember, hardware wallets don’t directly store your coins.
Your coins are already located on the blockchain. These devices just help you to sign transactions.
Why you should have a Hardware Wallet?
What’s wrong with keeping your coins on the crypto exchange you might ask.
Let’s identify an exchange to the bank.
Even though, banks offer several layers of security on your account the main server can still be hacked and get all the funds stolen.
Now let’s identify a hardware wallet to the cash.
Nobody can access your cash through online network right?
Now imagine if somebody stole your cash, and in order to use it they would need a special seed phrase.
However, since you are the only person who knows the security phrase your funds would remain untouched and you could recover your stolen cash in few simple steps.
It is definitely worth paying a little extra for the hardware wallet and sleep peacefully at night knowing your coins are kept in a safe manner.
What if you lose or break a Hardware Wallet?
Do you keep your 12-24 seed phrase offline and in private?
Then losing or breaking your hardware wallet should not be a problem.
Your device will have a PIN that needs to be entered before someone can use it.
Therefore, several failed attempts to unlock your cold storage will block it automatically.
As mentioned previously your coins are not located in your device.
You can just buy a new cold wallet and enter your recovery phrase to access your crypto assets on the blockchain.
Once you receive the new hardware wallet we highly recommend generating a new address and moving your funds there so they have nothing to do with the old stolen/broken wallet.
If you want to add an additional layer of security consider setting up a Passphrase.
Passphrase can be identified as a 25th word of your seed phrase.
It gives you an access to entirely new wallet that can not be accessed with a regular 12-24 word recovery phrase.
Therefore, if you decide to add the Passphrase security to your Trezor or Ledger device it is very important to remember your 25th-word character by character.
Otherwise, you will not be able to access the coins located in your wallet.
Can Hardware Wallets be hacked?
The vulnerability exists because hardware wallets tend to have 2 processors.
- One deals with security
- Second handles everything else such as the display and USB connectivity.
With hardware wallets, when the USB connects to your computer, it does not reveal the private keys to the machine.
If you buy it from unreliable source there is a chance that someone replaces firmware before you receive the device.
It could even stop the device from displaying warnings.
Hence, keeping your seed phrase on the paper will maximally minimize such risks.
Further down the line, we will teach you how to check whether your device’s security has been compromised or not. Both, on Trezor and Ledger.
Trezor vs Ledger Ultimate Review
Now since you already have a pretty solid understanding of what hardware wallet is let’s review the best cold storage accustomed to your needs.
Trezor vs Ledger: Physical appearance
It helps users with managing cryptocurrency transactions and viewing the seed phrase.
However, Trezor’s display screen is bigger compared to Ledger’s. Making it more convenient to use.
In addition, Trezor Model T has an amazing touchscreen feature.
Both come with 2 buttons to manage the device.
The difference is that Trezor has more space in between the buttons making it easier to click each.
Ledger’s buttons are different from Trezor’s.
They are pretty close to each other. Creating a chance to miss click.
Trezor is bigger in size than Ledger.
Some people might say that Ledger Nano S is easier to carry.
However, we consider that both devices are convenient size to take it with you wherever you go.
- Trezor wallet dimensions and weight: 60mm x 30mm x 6mm (2.4in x 1.2in x 0.2in) and 12 g (0.42 oz)
- Ledger Nano S wallet dimensions and weight: 57mm x 17mm x 9mm (2.2in x 0.7in x 0.4in) and 16.2 g (0.56 oz)
Appearance preference is pretty personal however we consider Trezor is the winner in terms of convinience.
Trezor vs Ledger: Durability
Trezor device is made from plastic. While Ledger is made from stainless-steel.
Therefore, making Ledger Nano S more classy and damage resistant.
However, to keep up with the competition, Trezor recently released Trezor One Metallic.
There are only 300 pieces of this limited edition and unfortunately currently out of stock.
Neither of the devices is waterproof.
Therefore if your device comes into contact with liquid it should be immediately turned off and extensively dried before trying to use it again.
Unless you get Trezor One Metallic we consider Ledger is the winner in terms on durability.
Trezor vs Ledger: Cryptocurrency support
Imagine getting your hardware wallet only to later find out that it doesn’t support the cryptocurrency of your choice.
Fortunately, both cold storage devices support 1000+ different cryptocurrencies and any ERC-20 tokens on the Ethereum network.
However, it’s important to note that Trezor does not provide full software coin support.
Therefore you will need to use MyEtherWallet or any similar application to store Ethereum and ERC-20 tokens on Trezor.
Meanwhile, Ledger Nano S provides full software support for all these coins including Ethereum and ERC-20 tokens.
This means that you will not need to use MyEtherWallet and store cryptos directly on your Ledger device.
Ledger is the winner in the matter of Cryptocurrency support.
Trezor vs Ledger: Security
In regards to security, Trezor and Ledger are equally on top of their game.
Their main aspect of security is that the both hardware wallets generate their private key offline through the display screen.
It eliminates the risk of exposing your private key online to hackers and software malware.
Also, Trezor and Ledger give you an option to protect your device with PIN and seed phrase(12-24 word combination we’ve mentioned in hardware wallet discussion above).
If your cold storage gets stolen they will need to enter PIN first before being able to use the device.
And if you break or lose the hardware wallet you can easily recover your portfolio using the seed phrase that was provided to you once setting up the wallet.
In case you want to push the security to its limits consider setting up a Passphrase.
Passphrase is an additional 25th word of your seed phrase.
It gives you an entry to entirely new wallet that can not be accessed with a regular 12-24 word recovery phrase.
If you set up the Passphrase make sure to remember it character by character in order not to lose the access to your coins.
Ledger’s type of security
The Ledger Nano S‘s unique strength is in their highly-advanced security chips.
Such chips are only accepted for secure solutions such as passports and banking cards.
These chips have the highest level of certification ensuring that your private key is cryptographically secure.
Ledger is the only hardware wallet that uses chips that are certified by a third party: Secure Elements.
The only thing we dislike in regards to Ledger’s security is that it’s not open source.
It means that the users can’t verify what type of code or firmware is used in their Ledger wallet.
Trezor’s type of security
Unlike Ledger, Trezor considers that simplicity is the key to users protection and more complex the device is, the easier it is to find a weakness to hack it.
Therefore, they are not pushing forward any kind of chips.
Trezor limits the ways of communication (eg. Wifi, fingerprint reader, battery or bluetooth) on the device to maximize its security.
Even if your computer has a key-logger installed on it and the security words are stolen, it would take many years to crack the order of the actual seed even with the most powerful computer.
Moreover, on Trezor Model T, the seed phrase is entered using Trezor device itself, so there is no danger of getting such information stolen from your computer.
Unlike Ledger, Trezor is fully open source.
It means that users can easily modify and build on top of the software.
Trezor considers that users are not obligated to trust anyone besides themselves, not even the company.
Sounds pretty fair.
Very important thing when dealing with Trezor:
Every brand-new Trezor device comes with a holographic seal to identify its authenticity.
It’s not worth the headache dealing with third parties only to buy Trezor for a discounted price.
Your package might arrive with a fake holographic seal.
Making it very possible getting your cryptocurrencies stolen from your wallet.
In the image below you can see the difference between real and fake holographic seal on Trezor’s package.
Some additional steps for higher security
- Never enter your seed phrase online.
- keep your seed phrase in the safest place you can think of.
- Don’t buy hardware wallet from third parties(only from Trezor’s and Ledger’s official websites).
- Check for an authentic holographic seal in case of getting Trezor.
We consider Trezor to be a winner in the security debate.
Trezor vs Ledger: Pricing
Both companies have released different models of hardware wallets.
Pricing varies from $50 to $200.
Each model’s cost depends on its release date, features and cryptocurrency support.
we will be comparing equal generation devices of Trezor and Ledger to each other.
Trezor One vs Ledger Nano S: Pricing
Trezor One’s price stands at $57/ €49.
While Ledger Nano S costs $71/ €61.
There’s a small price difference between the first generations of Trezor and Ledger.
Trezor Model T vs Ledger Nano X: Pricing
Both of them have better features and compatibility compared to the regular ones.
Trezor Model T costs $175/€149.
Ledger Nano X costs $144/€123.
To sum up
Trezor One is cheaper than Ledger Nano S as well as Ledger Nano X is cheaper than Trezor Model T.
However, what gives the Ledger upper hand in this aspect is that they offer free shipping to any region.
Ledger is the winner in cheaper pricing. However if you personally like Trezor more it's better to pay a little extra and get the wallet you're comfortable with using.
Trezor vs Ledger: How to buy
If you have read this far then you would definitely understand the importance of buying your hardware cryptocurrency wallet from reliable distributors.
Therefore, you can buy Trezor hardware wallet from their official website:
Similarly to Trezor, you can buy Ledger from their official website and receive free shipping:
Keeping your funds on the cryptocurrency exchange is not always the safest bet.
If you have more than $200 worth of portfolio getting a hardware wallet is a very financial-wise decision.
Investing in the hardware wallet is something your future self would definitely thank you for.
Remember the safety steps we have covered in our article and you can confidently Hodl your crypto as long as you would like to.
If you liked the article feel free to share it with your friends who you think should add extra security layers to their portfolio.
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