Clear DefinitionsHardware Wallet
1 min read
Pronunciation
[har-dwair woll-it]
Analogy
A hardware wallet is like a safe deposit box: your keys stay locked inside a secure device, and only you can authorize withdrawals.
Definition
A physical device that securely stores private keys offline and signs transactions without exposing keys to internet‑connected systems.
Key Points Intro
Hardware wallets protect crypto assets through:
Key Points
Offline key storage: Private keys never leave the device.
Secure signing: Transactions are signed inside the device’s secure element.
PIN protection: Requires PIN or passphrase to unlock.
Firmware verification: Often includes tamper‑resistant and signed firmware.
Example
A user connects a Ledger Nano to their computer, enters their PIN, and approves a Bitcoin transaction on the device screen before broadcasting.
Technical Deep Dive
Hardware wallets use a secure element (e.g., STM32) to store an elliptic‑curve keypair. The host computer sends an unsigned transaction; the wallet displays details for user confirmation and signs with the private key internally, returning only the signature.
Security Warning
Loss or damage to the device without backup seed phrase results in permanent loss of funds; store seed securely.
Caveat
Physical devices can be stolen or tampered with; buy only from trusted vendors and verify authenticity.
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