Security should always be at the forefront of any crypto holder’s mind. From those who merely hold a few satoshis, right up to those whales sitting on hundreds of thousands or even millions of dollars worth of coins, keeping them safe should be their number one concern.
Most of us probably fall somewhere between those two poles and we should always be asking ourselves how safe our sats really are. The thought of having them stolen, after all the work we’ve done to build up our holdings, is enough to bring on a cold sweat.
As luck would have it, there is a way for you to keep yourself from having to change your shirt every few minutes. The most effective way to keep your crypto safe is to store it on a hardware wallet. Yes, you could leave your coins on an exchange. You would however have to trust that its security protocols are capable of withstanding attacks from hackers intent on following in the footsteps of those who robbed Mt. Gox or Bitfinex.
Or you could use a software wallet that gives you access to your private keys via your phone. Both offer reasonable levels of protection from hackers and malware. Remember though that both these options suffer from one crucial vulnerability: they are connected to the internet. Whatever security is in place, hackers still have somewhere to start from.
Benefits of Hardware Wallets
The beauty of hardware wallets lies in their simplicity. They are, essentially, ‘dumb’ devices which hold your private keys but never connect to the internet. Hackers have no way of accessing them and the information needed to access your crypto is kept offline in ‘cold’ storage.
Hardware wallets not only store your private keys (which prove that you own your crypto) but they also sign transactions on your behalf before adding them to the network. The whole process of storing and using crypto is made safe and straightforward.
Hardware wallets often look like flash drives and are connected to your computer in much the same way. Here’s the thing though: even if they are connected to a computer infected with malware or under the control of a hacker, they still can’t be accessed without the recovery or ‘seed’ phrase, which is known only to you. Keep this safe and the hackers are left high and dry.
Hardware wallets are by some distance the safest way of storing your crypto and if you don’t yet use one then it’s perhaps high time you started.
When we reviewed the top five hardware wallets here on Coin Bureau some time back, the overall winner was the Ledger Nano X. Its features, design and cost made it the best pick for those looking to invest in a hardware wallet and, a year on from its release, it’s still top of the tree.
So, we’ve decided to revisit this little beauty and take a bit of a deeper dive into it. We’ll cover all its features, how it works, what it will cost you and how you can get your hands on one. We’ll also start by taking a quick look at the company behind it, as well as a look at the software that enables you to use the wallet itself and do a whole lot more besides.
The Lowdown on Ledger
Ledger itself began life in France back in 2014, making it something of a stalwart of the crypto space. Inspired by the idea of ‘creating secure solutions for blockchain applications,’ its founders came together from a variety of backgrounds including engineering, internet security and cryptocurrency. Today the company employs more than 130 people and has offices in Paris, Vierzon in central France, New York and Hong Kong.
There are currently two Ledger devices on the market: the Nano X and its smaller sibling, the Nano S. The Nano S half the price of the Nano X but a bit lighter on features. It’s still an excellent option for those looking to buy their first hardware wallet.
Ledger’s big rival in the hardware wallet sphere is Czech company Trezor, producer of the Trezor One and Trezor Model T devices. You can read more about these in our hardware wallet review.
It’s worth pointing out that, of the two companies, only Ledger can claim to have an immaculate security record, as Kraken found out earlier this year that Trezor wallets did have a vulnerability which allowed them to be hacked in some instances. This, coupled with the sleeker designs and more competitive pricing of the Nano models, makes Ledger the marquee name in the hardware wallet field.
The Ledger Live app
As simplicity is one of the great strengths of hardware wallets, they need compatible software to do the heavy lifting when it comes to using them. Ledger devices rely on Ledger Live in this respect and it’s worth taking a few minutes to look more closely at this proprietary software.
As well as managing the coins and tokens stored on your device, Ledger Live also lets you buy crypto securely through its integration with Coinify. If you make sure that your hardware device is connected whilst buying your coins, then they will automatically be stored on the device.
You can currently buy Bitcoin, Bitcoin Cash, Ethereum and Dash through Ledger Live, while Stellar and USDT are due to become available in the near future. The buying feature is available to users in most countries (there’s a full list here) and you will need to complete full KYC with Coinify.
Ledger Live is available as an app through both the App Store and Google Play and there’s also a desktop version available for those who prefer not to manage their portfolios on the go. In terms of system requirements, you will need Android 7 and up or iOS 9 and above. If you’re a desktop user then Windows 8+, macOS 10.10+ and Linux will have you covered.
The app supports 26 coins and over 1250 ERC-20 tokens (full list here). You can send and receive crypto through it and it also supports staking. This latter feature is a handy way for you to earn interest on your crypto by allowing your coins to be put to work validating transactions on the network and creating new blocks.
This incurs staking rewards, which are added to your holdings over time. Not all coins can be staked, but Ledger Live supports most of the principal ones, including Tezos (XTZ), Tron (TRX), Neo (NEO), Cosmos (ATOM), EOS (EOS) and Algorand (ALGO).
Staking is increasing in popularity as people get wise to the benefits of it, so any crypto app worth its salt needs to be offering this option nowadays. If you want to learn more about the process and how it works, then there’s more detailed information on Ledger’s own website.
If you’re of a techy persuasion and want to delve deeper into what the team there are up to, then you can check out their Github which is updated frequently. They’re also active across various social media channels including Twitter, Facebook and YouTube.
The Nano X
You should by now have a good understanding of the company and the software behind the wallet itself. Ledger is an established brand, with millions of users worldwide and a so-far spotless safety record. The Ledger Live software is easy to use and well laid-out, so managing your wallet with it could not be simpler. So, armed with all that reassuring knowledge, let’s take a look at the Nano X itself and how you can get started with it.
In order to make it relatively inconspicuous, the Nano X is small and lightweight, weighing in at a mere 34 grams. In the box you’ll find, along with the device itself, a USB Type C cable, instruction booklet, keychain strap and three separate sheets on which to note down your recovery phrase.
The buttons are nicely integrated which makes it that bit sleeker and more shapely than the Nano S model. These two buttons allow you to navigate on the device and pressing them both together activates the ‘Enter’ key.
The Nano X’s main advantage over its predecessor is its bluetooth connectivity, which allows you to control it from your phone. The Nano S could only be accessed via a computer, so this is a big step up in the convenience stakes. It also has a larger built-in screen and, while the Nano S could only store five wallet apps, the Nano X has room for 100. This allows it to store a much more diverse range of coins, including some of those more obscure ERC-20 tokens.
Once unboxed, the first stage is to connect your wallet to either your computer or smartphone, using the USB cable provided, or the bluetooth connectivity. Once done, you will be prompted to set up the pin code to ensure only you can access the device. This is an important added safety feature for if your Nano X falls into the wrong hands.
Once this is done, you will be given the words that make up your seed phrase. It is vital that you write this down and store it somewhere safe and secure. It’s a good idea to make multiple copies of this seed phrase and store them in different locations, as if you lose it then you won’t be able to access your wallet.
Many of those with large crypto holdings go as far as to store a copy of their seed phrase in a bank vault for extra safekeeping. This may be a step too far for most of us, but it does show just how important those recovery words are.
Some other hardware wallets allow you to skip this step and complete it later, but this is a mistake in our view. Time spent setting your device up properly is not wasted and this vital security step shouldn’t be put off till later. Get it done and get that crypto secure.
Once you have your security protocols in place, you can pair the Nano X up with your computer or phone. If you already have Ledger Live set up, then you can begin moving your coins across onto the device.
However, if you haven’t, download and install the app, then install the wallet apps you’ll need for the various parts of your portfolio. This done, the device screen will take you through the process of transferring your coins onto it. You should now be set up and good to go.
For the geeks out there, the Nano X runs on Ledger’s BOLOS operating system and contains two separate chips. The STM32WB55 runs the BOLOS system, while private keys are encrypted and transactions signed by the ST33J2M0.
The encryption on the device is also of a level that hackers are unable to access any data through its bluetooth connection. Whilst the advanced features of the Nano X theoretically offer more points of failure from a security perspective, any potential entry points for hackers and malware have been sealed up and the device remains totally secure.
There’s also a neat extra feature known as a hidden wallet, which allows you to set up different wallet interfaces on the device. These are accessed by a different pin code, so if you’re the victim of a $5 wrench attack and someone is forcing you to give them access to your device, then you can misdirect them to a wallet with only a small amount of coins contained within.
They will remain unaware that the majority of your coins are stored elsewhere on the device and they won’t be able to access them even if they make off with it.
Buying a Ledger Nano X
Before we get into prices, a word of caution. When buying a Ledger device (or any other hardware wallet for that matter) always buy it directly from the manufacturer. There have been instances in the past of thieves buying a device and noting down the seed phrase before selling it on.
They then waited for its new owner to load coins onto it, before using the phrase to clear it out. For this reason, avoid buying a wallet from Ebay, Amazon or any other retailer. Go direct to the manufacturer’s website and buy it there. It won’t be any more expensive and if you see cheaper alternatives elsewhere this should set alarm bells ringing.
You will also see a holographic strip on the bottom of the device when you remove it from its box for the first time. If this is missing, damaged, or showing signs of interference, then do not use the device.
The Nano X is available from Ledger’s website for $144 (£109/€122). This includes VAT. Shipping is free and there are discounts available if you buy more than one.
Whilst being double the cost of the Nano S, the Nano X more than justifies the higher price tag with its extra features and enhanced storage. It also compares favourably to its rival Trezor Model T, which costs $211 (£160/€179) inclusive of VAT and doesn’t include shipping. You do the maths.
As you can tell, we’re big fans of the Ledger Nano X here at the Coin Bureau. Its features, coins and tokens supported, ease of use and price tag put it way out in front of its competitors and, as it celebrates its first anniversary, there doesn’t seem to be anything out there to challenge its dominance just yet.
The Ledger Live app complements the hardware device beautifully and makes managing, storing and adding to your crypto hoardings a doddle. The team at Ledger have done a great job in building out the ecosystem to make their platform and hardware the number one name in cryptocurrency security. It will be intriguing to see what they have to offer us in the future.
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