One of the primary advantages of cryptocurrency over traditional currency is the elimination of third-party risk. That is, until most people decided to use cryptocurrency exchanges to purchase and store their assets.
What does this mean?
Coinbase, Bitfinex, Binance, and Kraken are all examples of popular crypto exchanges. People purchase different coins on these exchanges and often leave and store them in these same exchanges.
The problem: These newly bought assets are being stored on a third-party server. Technically the asset is still belongs to the exchange. Meaning if attackers were to hack the crypto exchange, all of the assets (yours included) would be vulnerable.
This explains why every few weeks a new story breaks about different crypto exchanges being hacked, resulting in millions of lost assets.
What other options do you have?
The options are plentiful—there are just significant drawbacks to many of the popular methods. Let’s provide a list:
Desktop wallets are wallets that store your private key on your hard drive. They move your assets off an exchange, which are highly targeted by hackers…but are still connected to the internet in most cases and vulnerable to attacks. If your hard drive crashes, your assets are also susceptible to being lost.
Mobile wallets are similar to desktop wallets, but for your mobile device. These are often seen as less secure than desktop wallets due to them being easy to misplace / have stolen. Hackers can also access devices via malicious wifi attacks which puts your assets at risk.
Hardware wallets are considered one of the safest options, as your private key is stored in a micro-controller immune from computer viruses. The downside to hardware wallets however is the potential for bugs in the software / hardware and most notably losing your recovery phrase which would leave you unable to access the wallet.
Paper wallets are exactly what they sound like. Otherwise known as “cold storage,” you store your private key on a piece of paper or material that is offline and unable to be hacked or affected by bugs or viruses. The issue with paper wallets is their vulnerability to physical harm, such as wear and tear, water, fire, mishandling, etc.
So what can you do?
The safest way to store your cryptocurrency is in cold storage (offline and away from the threat of attackers and malicious software). However, as mentioned about paper wallets, many cold storage options are vulnerable to physical damage.
the HODL wallet is an indestructible cold storage wallet made from AISI 316 stainless steel created to securely store your private key. It’s invulnerable to hackers, malicious software, and hardware malfunctions…in addition to being waterproof, fireproof, and incredibly strong.
If you already own a hardware wallet, it’s best to backup your recovery phrase with the HODL wallet, which is compatible to store any private key or recovery phrase. This gives you the security of a hardware wallet, plus the ease of mind of a secure backup.
In a world where billions of crypto assets have been lost or stolen…the HODL wallet is the most secure option to store your cryptocurrency, period.