When it comes to storing and managing your cryptocurrency, one crucial decision you’ll need to make is whether to use a hardware wallet or a software wallet. While both types of wallets have pros and cons, there are several reasons why a hardware wallet may be the better choice for many people.
One significant advantage of a hardware wallet is security. Unlike software wallets, which are stored on your computer or smartphone and are vulnerable to hacking and malware, hardware wallets are physical devices that store your cryptocurrency offline. This makes them much less susceptible to cyber threats, as they are not connected to the internet and cannot be accessed remotely.
In this opinionated piece, we’d like to share some unusual tips you might find helpful when managing and using your hardware wallet.
Prepare a Spare Hardware Wallet
Having a spare device gives you peace of mind knowing if the current one is broken, you can still access your funds by loading the seed phrases into the new one. Also, if the spare one comes from a different manufacturer, e.g., using Trezor and Ledger, you can reduce the risks of running into the same hardware defects or firmware issues.
That being said, having a spare hardware wallet doesn’t mean it needs to be sitting idle — you use two devices at once and store different assets in each one, and if one piece of hardware is compromised, the assets on another wallet are still intact.
For those tightening their belts to pass through the current market condition — you can use Airgap, an open-sourced wallet that turns your smartphone into a hardware wallet, as an alternative. One major attraction for Airgap is that, despite your phone being completely offline, i.e., in airplane mode without a SIM card, you can still use DeFi applications by connecting it to MetaMask via a QR code.
Write Down and Store Seed Phrases Offline
If you’ve been on CT for some time, chances are you’ve heard someone save their seed phrases in their computer or a password manager, and then their assets are stolen.
Don’t be that guy. Write your seed phrases down offline.
Besides simply writing down all of the seed phrases on a single piece of paper, there are several approaches you can consider:
- You can separate your seed phrases into different groups; each is written down on a different piece of paper. And only amassing a certain number of papers can recreate the entire seed phrases. In a way, you create a multi-sig-like mechanism for your seed phrases. For example, let’s say your seed phrases contain 16 letters; you can put ten letters down on three pieces of paper with some letters overlapped on each one. By doing so, no matter which 2 out of 3 papers you gather, you can always recreate the correct sequence of letters. You can also write phrases in different languages to enhance security.
- Another way is to use the likes of Tinyseed to store the letters in an encrypted way on a metal plate, which is easier to carry and doesn’t deteriorate by nature.
Prepare Recovery Instructions for your Family
Following the tips in this article or not, given that you’re the only person in the world who knows about the setup, it would be wise to prepare recovery instructions so that your family members can access your funds should something terrible happen to you.
Here are the things you can include in the instructions:
- The people your family can ask for help if they’re stuck
- The locations where the papers that contain recovery phrases are stored but not too detailed — something like “inside my doghouse” which your family knows where it’s would be just fine
- The process of putting seed phrases into a hardware device
- The venues to convert crypto into fiat
Also, you can consider putting “DO NOT SHARE THE PHRASES WITH ANYONE” in bold on paper in case the people you thought you could trust they turn out to be Assholian and try to scam your family.
Once you write down the instructions, you ask the people you list on the paper to see if they’re willing to help once your close ones contact them. Ideally, those people speak the language your family speaks, know crypto, and, most importantly, have integrity. Depending on where you live, you can hire a lawyer or accountant to assist your family if you have no friends, like most of us. 😢
The last thing is to store the instruction somewhere safe. It can be your safe or a safety deposit box in a bank.
We hope that the tips we mentioned in this article will help you improve the security of your funds. Stay safe out there, anons!