Topic: Which best for long term investment? Hardware wallet or Software wallet . - page 3. (Read 900 times)

If he thinks it's the biggest problem with hardware wallets he is wrong. Because hardware wallets are usually not air gapped, they are plugged on connected computers. For a long term investment, that's far less safe than any software cold wallet. Because it's not easy at all to check that your hardware wallet is not a fake one, and has not been tampered. Moreover they are not open source, so you'll never know if there are backdoors or latent vulnerabilities into them, that will be discovered and used by someone one day. I would add that even if a manufacturer is reputed, there is no guarantee it will always stay honest (look the Coldkey case for example), and the CEO/management of the company can also change without notice.

Updates rarely fix major vulnerabilities that would result in you losing your crypto unless you install the latest version. It's usually cosmetic changes, new features, speed improvements, etc. It's almost always a user mistake that leads to getting your wallet emptied. Whether you have the newest version or one that is a few months old, you are still using a hot wallet and your keys are online. One slip-up might put your coins jeopardy or worse.   

Safe? Do you mean safely as in a safe way? Your keys are online, it's as simple as that. They would be safer if they were never online and always in a secure device and its chip. Even better, if they were created in a fully offline and airgapped environment.

So true and I agree, it's better to buy a hardware wallet, do you think it's better to buy a hardware wallet, friend? to be honest, I use an electrum wallet on my desktop, although I'm using it okay because I've been using it for 4 years, as long as it needs to be updated, I update it right away.

      And my password, private key, and the creation of a sign message if needed, I can also do it in the safe. Then it seems that there is a new hardware wallet coming out now and that's what you want to try. Thank you

To give you context, another poster brought up a concern that the biggest problem in purchasing a hardware wallet is privacy-related, because you have to give up your home address, real name and probably other information. I merely suggested a way in how a person can buy one without giving up any real information about himself/herself. You don't have to be angry and nitpicky about it.

It is paranoid and super expensive doing all this just for one hardware wallet, I am not talking if you are dealing drugs, selling alcohol or nuclear fuel all the time, so you need to have this.
But go ahead and keep recommending people to buy fake ID (aka commit crime) because that is ''standard safety measure'' in your world
What I proposed is 100 times more simpler, cheaper and safer, plus you don't have to commit any crime along the way.

For now, it's better if you just use a software wallet instead of buying a hardware wallet, but you should be able to secure it from others.
As long as you can secure it, I think the software wallet is safe because I keep some satoshis in it.
So before you have the money to buy that hardware wallet, you can use that software wallet to store your bitcoins.
If you have money, you can buy Ledger or Trezor and many people have recommended both but maybe Trezor is more attractive because it is cheaper.

I was merely posting a work around for those who truly don't want to give up their I.D. to a centralized database controlled by a third party in buying a hardware wallet, ser. If anyone can buy one over the counter using CASH, then that would be the most ideal way to buy one.

Plus it's not really "paranoid". That method of using fake I.D. and opening a P.O. Box is actually a standard safety measure used to buy "something else" from the internet.

Why would you go through all this hoops of buying fake ID and paying extra for that and PO box when you can probably find perfectly good hardware wallet in your local area or country?
There are official resellers and it would probably be cheaper to go with low cost flight and buy wallet directly in some other country if it's not available in your own.
Paranoid people can always make their own DIY signing devices, from regular devices like RaspberryPi Zero and similar devices.

The safest place to buy hardware wallets is in some store with physical beingness, preferably somewhere far away from your home. You enter, take the device, pay with cash, give no information of who you are, done. The second safest place is any Internet store using a postal service, so that the merchant don't know your name, phone number etc.

For people who truly want a hardware wallet without giving up real identity, go to the Dark Markets that sell fake I.D. for Bitcoin. Use fake I.D. to open a P.O. Box in your local post office, use the same fake I.D. to buy your hardware wallet from manufacturer's website.

 


OK, good for you.

Probably the question we should be asking is: where is the safest place to buy hardware wallets?

Somewhere where the number of second-hands (which are always risky) are kept to a minimum or not present at all, and where you don't have to give out your personal information when you place an order, and ideally one which lets you buy them in bitcoins. So not (most) manufacturers' websites.

Even though the hardware is the most secure option but sometimes even the software wallet can be used if the funds are now too much. I mean why need cold storage if you can just know how to properly secure your wallet? I am using a desktop wallet and have never been the victim of any hack or something.
You do not download random software, you do not click on the random link, a good anti virus software is installed on your computer, and you do not give your keys to anyone then you are good to go even with the desktop wallet (In case of fewer funds only).

For long-term investments using a hardware wallet is much safer although some use software.
Using a software wallet to store your long-term assets could be at risk of a virus or something that makes you unable to access it anymore.

I think from the many answers that have been left on this topic, you can judge and conclude what is best to use.
If you still don't have the money to buy a hardware wallet, then save little by little so you can buy one.
In the meantime, use a software wallet first.

That's true, I did consider adding that to my explanation. There's been arguments about Intel, and AMD having various things in the past. For example, the ME engine, and AMD's equivalent. So, yeah this is probably a risk also.

There's ways around the privacy issues with hardware wallets, but yeah most people won't have those provisions in place, and will be giving their home address. I do believe a lot of places these days refuse to send to PO boxes too, which obviously restricts what you can do to try, and keep your privacy intact.

Right, it's a sophisticated attack which isn't likely going to affect most users purchasing a hardware wallet, like I said it's probably something that's so unlikely that a lot of users are willing to ignore.

OP, it's always more secure to own a Hardware Wallet, but for how much coins you currently own, just keep saving and buying Bitcoin until you can comfortably spend for a Hardware Wallet. Plus you can always use an old computer for cold storage, and that would be as safe/secure as a Hardware Wallet.

 

Such things are difficult to judge from black and white logic, it is true that creating an airgapped wallet is cheaper and safer when it comes to physical attacks (the probability of someone stealing a flash memory to hack you is less than stealing a hardware wallet), but you need a degree of experience to do it properly.
Also, this example applies only to Bitcoin, but if you want to store some altcoins then hardware wallets will be the first choice.

Theoretically speaking, the same risk applies when buying a new computer. There's absolutely no practical manner to verify that it produces provably pseudo-random numbers, and that it hasn't been altered.

I'd say that the serious attack vector you're adding with a hardware wallet is privacy related. You're most likely not having a hardware wallet at your local place, so you're going to buy one from the Internet. So, the merchant has to know your home address, real name and so on. Some of us have experienced data breach with Ledger, and I'm sure lots of thieves would find this information valuable.

Hardware wallets have been known to have physical vulnerabilities, and someone might be more inclined to leave them lying around unsecured. A software wallet, you technically only need to save the seed, and generally you'll be warned to secure that pretty well. I'm not talking about a software wallet connected to the internet, I'm talking from the point of view where you want to generate an address, and just receive Bitcoin to that address. Since, with a hardware wallet you have to purchase it from a vendor, hopefully the original manufacturer, there's a element of risk of third party vendor having physical access to the device, and therefore altering the hardware wallet, with a wallet that you download, verify, and then keep in a offline environment you don't have these risks.

Hence, why I went on, and said about being more confident in securing a seed than a hardware wallet. Although, I could've probably been a little more clear in that. So, if I wanted to just generate a seed, and basically have a offline wallet, I'd probably not even need the offline wallet, copy the addresses, save the seed, and focus on securing that seed. Even, if you are going to be keeping the wallet offline, as long as its secure in the first place, it's no less secure than a hardware wallet technically. However, when regular access is needed, and therefore becomes a online wallet, a hardware wallet makes sense due to the reasons you mentioned.

However, for private key generation or a offline wallet, a hardware wallet is definitely more expensive, and potentially overkill if it's going to remain a offline wallet. If you intend to use it regularly, and therefore online then yeah I'd absolutely agree that software wallets then have more attack vectors.

It seems like the OP was talking about holding Bitcoin, hence the reason I believe a offline wallet should be fine, and technically could potentially have less chance of being compromised in a physical attack, since there's various ways of securing it, whereas a lot of people tend to think hardware wallets are invulnerable even physically, and buy them from third party vendors quite often.

The key thing is; if you want a offline wallet, that you are holding Bitcoin on; offline wallet generated via verified software. If you want to regularly use it, and therefore online; hardware wallet. The added risk to a hardware wallets depends on how you got it, and how you secure it. Those are the additional risks, with the latter also being true for offline generated wallets.

Worth noting, while the vulnerability was patched, I wouldn't doubt that we'll see similar attacks, but there's also less secure hardware wallets than a Trezor. Trezor are pretty decent hardware wallets compared to some out there.

So, my line of thought was due to third party vendor issues or an attacker gaining physical access it could potentially have more risks. Although, I'll admit I didn't really explain that all too well. However, the chances of someone doing that, and having a zero day exploit? Probably, rather slim. Although, worth mentioning since you can avoid the risk of that by not using it at all. What I will say; for the vast majority of users, a hardware wallet is probably going to be the most secure, especially for new users. Again, I should've probably mentioned that, but thought there was enough users saying that .

theoretically probably wasn't the right word. Needed to be something like if a offline wallet is generated under perfect circumstances, e.g airgap etc, then it technically can be more secure than a hardware wallet if it remains offline, or the seed is backed up, and then the wallet is deleted from the computer. I don't know, a lot of people will think physical tampering of a hardware wallet before it arrives to you, is so incredibly unlikely it probably shouldn't be worried about it too much, especially if it's bought from the official store. However, not everyone has that privilege since they don't always deliver worldwide. One thing for sure, is that is a risk that you don't have with a offline wallet that you generated. However, you still have to keep your seed secure, and obviously your hardware wallet due to physical attacks potentially being an attack vector.

If you have money to buy smartphone than I don't understand how you can't have much less money for purchasing hardware wallet.
Software wallets can never be safer than good hardware wallets, except if you are using them correctly on airgapped laptop, that is very unlikely for people who don't have money.

What?!  
No, hardware wallets don't have more attack vectors, because their only purpose is to work with cryptocurrency transactions.
Software wallets are installed on multi-purpose devices like computers or smartphones that by definition have multiple time more attacks vectors than hardware wallets.
Not to mention all the risk with malware, viruses, keyloggers, internet connection, and bunch of other issues that don't exist on good hardware wallets.

Theoretically speaking, a hardware wallet has more attack vectors than a software wallet, however that entirely depends on how you intend to use it. Personally, I believe a private key generated on a secure offline computer is the gold standard. Whereas, a hardware wallet is more suited to those that need to access their Bitcoin regularly, and don't want to think too much about security issues that could arise from that.

However, I'd probably be much more confident hiding my seed than my hardware wallet, since physical access to anything generally allows more sophisticated, and out of the box thinking attacks, I usually consider physical access possible to be compromised despite no documented attacks.

A seed can be reasonably secured, and potentially be as complex as you need it to be.