The controversy surrounding Ledger's latest firmware update and the introduction of Ledger Recover have ignited a crucial discussion within the cryptocurrency community. It highlights the need for users to evaluate the features and implications of any wallet they pick to entrust with their digital assets. The incident has driven many users to reconsider their options, seeking alternative hardware wallets that align with their security and privacy preferences. One option that is gaining popularity is the use of air-gapped wallets.
What is an air-gapped wallet?
An air-gapped wallet is a cold wallet that works offline and is inaccessible to any type of connection. "Connection" refers to any means by which the device establishes a link with another device or the internet, such as USB, Bluetooth, Wi-Fi, cellular, or near-field communication (NFC). Hardware wallets, like Ledger, are not air-gapped, and hackers have discovered ways to hack them. A fully air-gapped wallet provides a secure environment and eliminates any potential vulnerabilities that could be exploited by malicious entities. Air-gapped wallets available today have cameras used to scan QR codes. These QR codes enable users to complete crypto transactions.
Advantages of air-gapped wallets
1. Better security - It is much more difficult for bad actors to access your funds because it is offline. An air-gapped device effectively eliminates potential threats to your security by keeping your private keys offline and cutting off external communications.
2. Self-custody - You are in complete control of your digital assets and responsible for securing the device.
3. Increased privacy - No one can track your transactions because it is disconnected from the internet. The risk of phishing, virus, and malware attacks is reduced.
4. Poor internet connection is not an issue - It enables users to access their funds even when you do not have internet connection.
Risks of air-gapped wallets
1. Additional hardware - Some devices need additional hardware, such as SD cards or card readers, and this adds to your cost.
2. Loss or damage - You may lose or damage your physical device. Make sure you have backups of your seed to avoid losing your coins in case this happens.
3. Complexity - Setting up and using an air-gapped wallet can be more complicated than using hot wallets.
4. Limited functionality - It is challenging to check your account balance or view your transaction history easily without transferring the wallet to a connected device.
Air-gapped Monero wallets
The only air-gapped wallet that supports Monero is OneKey, but it is not fully air-gapped. There are fewer options because of Monero’s unique privacy technologies. Here are some recommendations from XMR enthusiasts:
1. Research other hardware wallets that suit your needs and preferences. They offer additional security layers by keeping the private keys offline and requiring physical confirmation for transactions even if they are not fully air-gapped.
2. Users can also explore setting-up a dedicated offline computer with a Monero wallet installed, ensuring it is never connected to the internet. This offline computer can be used to generate and sign transactions securely. Those who are technically savvy can make their air-gapped wallet in this offline computer.
3.Use a paper wallet. The main disadvantage of a Monero paper wallet is you can only use it to receive XMR. You cannot send XMR or verify if the sent funds have arrived. Send, verify transactions, and use Monero with XMRWallet. XMRWallet is a web wallet that does not require you to register, provide an email address, or ask for information that can identify you. It is non-custodial, free, and you can access it from any device.
An unpopular method is to leave your funds in Ledger but not update the firmware. Hardware wallets remain one of the most secure options for storing your XMR. If you have lost confidence in Ledger, it is prudent to conduct thorough research before selecting an alternative wallet. Look for wallets with a strong reputation, prioritize security, and align with your specific requirements. Consider factors such as open-source software, community trust, regular updates, and the wallet's track record of security incidents.
Making hasty decisions when choosing a new wallet can have detrimental consequences. It is crucial to take your time, carefully evaluate the available options, and ensure the wallet you select provides robust security measures for safeguarding your private keys. Prioritizing security over convenience is vital in protecting your XMR holdings, so it is worth investing effort to find a reliable and secure wallet solution that meets your needs.