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- Why it isn't safe to leave my bitcoins on an exchange?
- Where should I store bitcoins for maximum safety?
- How safe is a Ledger Nano S?
- How does Ledger Nano S work?
- Is a hardware wallet like the Ledger Nano S worth buying?
Most crypto enthusiasts will be able to swiftly answer these questions but if you are new to the cryptosphere you might not be aware of the potential risks of holding your coins on centralized exchanges and how to safely store your crypto.
Potential profits from Bitcoin and cryptocurrency investments are probably the best out of all asset classes globally, as there is nothing like it. It surpasses gold as a store of value, despite the dips, and far surpasses gold, stocks or real estate as an opportunity for gains. But the risks in this new fledgling digital financial industry are also bigger than elsewhere. As a result savvy traders and investors are wise to take the necessary precautions when buying some crypto, by storing them safely for long term protection. And the best way of all to store your crypto is with the Ledger Nano S cold storage hardware wallet.
A Mt. Gox could happen at any time
We may buy our crypto at one of the many exchanges, but to leave it there indefinitely is adding to the risk factor. Several exchanges have been hacked over the years, the biggest of which is probably the now infamous Mount Gox hack in 2014. This was a huge exchange based in Japan, handling over 70% of all Bitcoin transactions globally. A total of 6% of all Bitcoin in existence was stolen right off the exchange, or at best frozen for years afterwards as they attempted to solve the crime of the cryptoverse. Around a third was eventually recovered but millions of dollars worth of their own personal crypto was lost to traders and investors there.
Offline storage to the rescue
It was after this massive theft that the Mt Gox management decided that the best prevention to future hacks was to take the funds off the exchange and to store them offline. And that’s what you should do too. All investors in crypto with any substantial amount of coin will do this. It’s just common sense, and common sense leads to common dollars. Keep only your trading capital on the exchange but put the bulk on a Ledger Nano S wallet for long term offline storage.
Ledger Nano Solution
The Ledger Nano S is best purchased directly from the company website itself. You don’t want some third party having potential access to your password. And they ship it to you in a matter of days for free. It looks much like a flash drive, perhaps little bigger, and the slick look and finish might remind you of an Apple product.
Built with security in mind
The great thing about it is that it’s engineered to be tamper-proof. The cryptographic mechanism checks the integrity of the device’s internal software every time you switch it on. The “Secure Element” chip will prevent any interception or attempt at physical replacement. This device is designed for security, so you can trust it with millions of dollars because all it is storing is your password key.
Paper backup
To be doubly sure you remain safe, you are also recommended to write down your 24 word key or seed phrase on a piece of paper, or better still burn it into a piece of metal plate, and store that backup away some where safe, like a hole in the ground in your garden. That seed phrase is the backup of what is stored on your device. Then there will be no problem if you lose the Ledger device itself, or if it’s stolen because it’s unhackable and you can still access your funds via your backup seed phrase buried in the garden or whatever.
Cheapest and best
Not only is the Ledger easy to use, it is also cheaper and more secure than its competitors. Since the newer bluetooth enabled Ledger Nano X has come out, the Ledger Nano S has come down in price from around $100 to a mere $59, whereas the next cheapest such gadget is the Trezor or the KeepKey at $79. Because of it’s better value for money and security it has far outsold its competitors, with over 1.3 million units sold so far, as of the last month or two.
User-friendly
You can even get them in a variety of different colors and they are very user-friendly. You plug it into your computer with the cable and the welcome screen comes on. You then only need the two buttons on the side to navigate through it. The beauty of it is that even when plugged in to your online computer device, your actual private key stored on the Ledger never leaves it, so it is never accessible online to any hackers at any time. And that is a sure way to stay protected from cybercriminals.
Hold your own keys
Remember that even if you have bought some cryptocurrency, if you don’t hold the private keys to it, then you don’t actually have possession of it.
“Not your keys – not your crypto”
is the iconic phrase that sums it up as far as security goes.
So leaving all your crypto on any exchange is just not wise in the long run. Besides that, the Ledger Nano S device is so easy to carry around. And if you lose it then have your backup phrase written on paper to reactivate another one. And that’s all there is to it.
Get yourself one – you won’t regret it.
Am thinking of bringing support for STEEM and DTC for the Nano S 🤔
Awesome! I was wondering for a while about why both ledger and trezor don't support STEEM?
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