Hardware Wallet Bitbox02 - Secure Bitcoin Storage
After buying Bitcoin, dealing with storage is the most important issue.
Which wallet is most suitable depends very much on how and for what it is used and what amounts are involved. Today, a hardware wallet is the best way for the vast majority of users to store Bitcoin securely.
Bitcoin is owned through the knowledge of a private key. This gives you access to the Bitcoin of a corresponding address. So you need a way to keep these keys safe, unless you want to leave your Bitcoin on an exchange. With this option, however, you run the risk that you don’t actually own the Bitcoin and you are therefore exposed to various risks. Thus, this type of storage is not recommended.
If you want to have control over your keys yourself, and that definitely makes sense, you use an app called “Wallet”. This generates the private keys and manages them. If you have this wallet on a device with Internet access, you are exposed to computer viruses or security breaches. For the coins in daily use, this makes perfect sense, but for larger amounts, you don’t want to take this risk.
You could now take care of a secure setup yourself, but it quickly becomes quite technical and time-consuming. There are wallet providers that offer the possibility of so-called cold storages, where the part of the wallet with the private keys is located on an offline computer (e.g. Electrum, Specter, Sparrow). The setup is two-part and consists of a Watch-Only Wallet (online) and a Cold Storage (offline). A transaction happens as follows:
1.) …Generate with the Watch-Only Wallet
2.) …transfer to cold storage (memory stick)
3.) … sign on Cold Storage (only Cold Storage knows the private keys)
4.) …transfer back to the Watch-Only Wallet.
5.) … transmit to the network in the Watch-Only Wallet.
This is too technical for most users and definitely more inconvenient for everyone than a hardware wallet.
The Hardware Wallet
A hardware wallet works similarly to the cold storage described above. It includes a secure area on an external device where the private keys are located. The hardware wallet generates the keys and signs the transactions. The hardware wallet is protected in such a way that no virus can take root and the private keys never leave the device. Now you might ask yourself; what happens if the hardware wallet is defective or even the company that makes the hardware wallet no longer exists? Fortunately, this is not a problem as long as you follow the best practices regarding backup. Today’s wallets are virtually all so-called hierarchical deterministic (HD) wallets. In these, the key pairs are derived starting from a seed, which consists of 12 or 24 words. With this seed you can recover the wallet. Since standards exist for the derivation, there is no need to rely on a single device or the manufacturer:inside.
A top choice among hardware wallets is the Bitbox02 from Shiftcrypto. Shiftcrypto is a Swiss startup.
f418.me likes special about the Bitbox02:
> There exists a “Bitcoin only” version
> It can be combined with various software wallets or used with its own app
> The company Shiftcrypto provides a lot of background information and Tutorials
> Security is the central topic at Bitbox02, read more at Security.
> A good hardware wallet always lets you verify the crucial steps on the device. The Bitbox02 does this very intuitively.
At shiftcrypto.ch you can find all the necessary information. With the code F418 you get even 5 percent discount.