Hardware Wallets: Security Tips

As the crypto industry develops, so too do the techniques for its theft. The surge in cyber-attacks, fraud, and other misadventures within the crypto industry makes it essential for us to stay alert and proactive in defending our digital assets.

Among the critical measures you can undertake to protect your assets is the use of a hardware wallet. Still, it's often overlooked that additional caution must be exercised during their purchase and usage.

One primary recommendation is to always buy hardware wallets directly from the manufacturer's shop.

Scammers peddle fraudulent hardware wallets on external websites, often pricing them lower than the genuine product. These deceptive wallets could be laden with malware capable of stealing your private keys, all while the packaging appears untouched and pristine.

Another key point to remember is to avoid using hardware wallets that you've won in a raffle or received as a gift. Despite the possible benevolent intentions of the giver, there's no certainty about whether the device has been compromised. Always strive to purchase hardware wallets from trusted sources.

When you have a hardware wallet, it's absolutely critical to handle it correctly. Avoid connecting it to multiple devices, particularly if you're keeping cryptocurrency stored for an extended period of time. Each time you link your hardware wallet to a new device, you heighten the potential risk of your keys being exposed to hackers.

Be vigilant when copying your wallet's address while employing a hardware wallet. Take note of not just the first and last numbers of your wallet, but also the ones in the middle. Spare some additional time to meticulously confirm the entire address before sending any form of cryptocurrency, regardless of which wallet you're utilizing.

One instance of malware that could potentially drain your savings is Trojan.Coinbitclip. This detrimental software swaps the destination address of a cryptocurrency transaction with one that is under the control of a hacker. This virus can pose a serious threat because it's not always apparent when an address has been altered. Make sure you've got the most recent antivirus software on your devices and always check the recipient's address a second time before transferring any funds.

Moreover, there was an occasion where fraudsters sent Ledger users what they claimed to be “new” hardware wallets in the mail, allegedly designed to safeguard them from the repercussions of a data leak.

The packaging of a counterfeit Ledger Nano X wallet. Source: Reddit

Security expert Mike Grover, after investigating photos of the internals of this so-called “wallet,” concluded that it was essentially a flash drive fastened to a Ledger, designed to deliver malicious software. It came with instructions for its configuration. Users were advised to link the “Ledger” to their computer and initiate the provided software. Then, the software requested the entry of a recovery phrase, purporting to import the user's wallet onto this new device. However, as soon as the recovery phrase was entered, it was handed over to the cybercriminals.

Safeguarding your digital assets is of paramount importance in the modern crypto terrain. Utilizing a hardware wallet is among the most potent ways to shield your resources, but it's essential to adhere to extra precautions when purchasing and using them. Always source your hardware wallets straight from the manufacturer, abstain from utilizing hardware wallets gifted to you, and try to avoid connecting your wallet to more than a single device. Secure your recovery phrase, diligently keep tabs on wallet addresses, and periodically update your devices with the latest antivirus software. By observing these guidelines, you can bolster the safety and security of your tokens.