Last week, the ChangeHero team covered the best software wallets in 2021. But software wallets can only be useful so far, advanced crypto users would want something more secure. In this article, we are going to present reviews of the best hardware wallets according to our team. Let’s help you pick the best hardware wallet 2021!
- A hardware wallet is a kind of cold storage device which stores private keys encrypted on a chip. The devices themselves let users interact with the keys and secure the chip;
- Hardware wallets are recommended for advanced users because the devices can be pricey depending on the functionality.
- What are the top 5 hardware wallets? According to our team, the best hardware wallets are Trezor Model One, Trezor Model S, Ledger Nano S, Ledged Nano X and CoolWallet S.
What is a Hardware Wallet?
These days, crypto enthusiasts prefer using hardware wallets to securely stash away their holdings. Why is it better than hot storage? Well, for one, in theory hackers can intercept messages sent by the wallets when signing a transaction.
Hardware wallets are devices that include chips which store and encrypt the private keys. The rest of the device either provides access to the chip (for example, screens and buttons) or prevents tampering. By that design, hardware wallets are a more secure alternative even to the safest of software wallets.
But why exactly hardware wallets are considered to be more safe and secure? Let’s see how they work to understand it.
How do Hardware Wallets Work?
Hardware wallets are non-custodial by definition, and the devices also act as a two-factor authentication tool. The wallets themselves do not connect to the Internet even when hooked to another device, only the companion software does.
When signing a transaction, the user gets prompted to confirm it. At the same time, your signature is generated from the key and communicated to the device connected to the blockchain. Since the private key cannot be reconstructed from the signature, it is impossible to compromise the funds by interception.
Can hardware wallets be hacked? There have been cases when hardware and software vulnerabilities were discovered but they are often quickly made public and fixed. All developers have bounty programs, so white hat hacking is more profitable and increasingly competitive.
The market leaders, Ledger and Trezor, have had such vulnerabilities identified by users and researchers. In Ledgers, it used to be possible to authorize a BTC transaction simultaneously with a LTC/BCH one. Later versions of the applications warn users if such a thing can occur.
Trezors and KeepKeys are known to be vulnerable against voltage glitching. Since this attack requires direct access to the wallet, Kraken Labs advice is not to lose the device itself. Unfortunately, some issues with hardware are not as easily fixed as with software so the developers provide full disclosure.
So, are hardware wallets really safe? Most of them are, they keep the private key intact and secure it. In addition, it is easier to keep funds in a dedicated device which often doesn’t even look like a wallet.
Top Hardware Wallets
Now that we know what hardware wallets are, we can have a look at some of the best hardware wallets. Since each of these devices costs money, it’s important to pick the best hardware wallet 2021 for your budget and needs.
Trezor are cold storage, hardware wallets that encrypt the user’s private keys on the device. You can interact with the funds with the web interface at the official website or some third-party wallets and services. No worries: the encryption is so secure that even a malware-infected computer would not have access to your private keys.
Bear in mind that Trezor is hierarchical-deterministic (HD), so each private key for each currency is generated from a single seed.
Trezor One has a plastic frame resembling a car key, monochrome display and two buttons. The display shows the PIN matrix, and the wallet has mechanisms for brute-force and disassembly protection.
In addition to security, Trezor developers, SatoshiLabs, go the extra mile to introduce tons of features in the official app. Trezor One supports about a thousand coins and Ethereum tokens. We cannot help but mention that you can swap your currencies right in the companion app with ChangeHero!
The $69 price makes Trezor One one of the cheaper options in our list of the best hardware wallets. Despite the price, it’s as solid an option as its more expensive counterparts. Despite being developed in 2013, it still stands the competition for the best hardware wallet 2021.
- Has the reputation of the safest hardware wallet on the market;
- Doubles as a password manager with 2FA;
- Convenient companion app or web interface with in-app exchange;
- One of the best options for a tighter budget.
- Some assets like XRP and TRON not supported.
Trezor Model T
Model T is the advanced version of Trezor hardware wallets. It comes with a color touchscreen which is used for PIN and passphrase entry and recovery. Model T also supports even more assets and has a backup mechanism called Shamir to solve seed phrase loss.
How does Shamir backup work? The wallet generates several seed phrases which can be distributed. To reconstruct the key, a certain number of these shares, set by the owner, is needed.
Model T also has an additional mode of two-factor authentication, FIDO2, in addition to U2F. Unsurprisingly, all these features make the Model T cost more than twice the Trezor One’s cost (159 USD vs. 69 USD). The price is well worth the value of the most secure hardware wallet on the market.
- All features of Trezor One plus extra security and coin options;
- Authentication on the device prevents tampering;
- Seed phrase loss is mitigated by Shamir backup;
- One of the best hardware wallets for functionality.
- The wallet is on the more expensive side.
A legit competition for Trezor wallets, Ledger offers a lineup of devices that are even more inconspicuous. Their hardware wallets resemble a simple USB flash drive rather than a special device. In addition, all Ledgers are HD wallets.
Further security is ensured by ANSSI (French cyber security agency) licence. Custom OS called BOLOS and custom technologies like Genuine Check, can detect whether a device has been tampered with.
The funds stored on the device can be managed with the help of companion app, Ledger Live. Ledger Live is available on mobile (iOS) and desktop (Windows, MacOS, Linux). Ledger wallets can also be connected with a number of third-party applications.
Ledger Nano S
Ledger Nano S comes in a sturdy, thumb flash drive-like frame with a monochrome display and two buttons. It can be connected to a desktop computer or an Android smartphone with a mini-USB cord. Users can use the official companion app Ledger Live as a bridge or connect it to some third-party software wallets.
Wallets for different currencies in Ledger come in the form of apps. Depending on the size of the app, Nano S has the space to store 3 to 20 apps. This somewhat limits the array of assets that can be stored on it.
Some reviews of the products claim that Ledger Nano S is not as user-friendly as some other entries in our list. We can recommend this option if you are willing to take your time and do your research. Purchasing it directly from Ledger will cost $59, which makes it the best hardware wallet in terms of price.
- Renowned for security;
- Inconspicuous and mobile;
- Companion app supports purchase and swaps;
- One of the best options in terms of price.
- Limited number of types of assets on a device;
- Less user-friendly.
Ledger Nano X
Released in 2019, Ledger Nano X is a newer and updated version of the previous wallet. In terms of size and usability, this device is larger, sturdier and has a larger screen and buttons.
In terms of security, it is essentially the same as Nano S. However, it is a vastly more convenient device to set up and use. Bluetooth connection lets you pair the wallet up with your smartphone and use it on the go.
Ledger Nano X costs twice as much as Nano S, 119 USD. This advanced option is cheaper than Trezor Model T but does not have a touchscreen or extra security features. Still, as far as advanced devices go, this pick has to be the best hardware wallet 2021.
- Supports more varied portfolios;
- Mobile thanks to Bluetooth connection;
- One of the best hardware wallets to upgrade from cheaper ones.
- A more expensive option in comparison to Nano S;
- Not open-source.
Unlike the previous entries, CoolWallet S is a device developed specifically for mobiles. A CoolWallet S is the size of a credit card, so its main advantage is portability. Like Ledger Nano X, it uses Bluetooth connection to hang up with the mobile.
Transactions are signed and secured with 2FA which can be amped up with biometric authentication on your device.
The philosophy behind this wallet is to combine convenience of software wallets with the security of hardware. It has all the software wallet essentials like history and balance tracker, with extra features like exchange built in. Exchanging crypto is especially easy and convenient, as this function is provided by ChangeHero.
CoolWallet might be not as well-known as Ledger or long-established as Trezor, but we are sure that eventually it will become equally popular thanks to the product’s masterly balance of convenience and security. Its $99 base price puts it in the upper area of the middle price range.
- Versatile companion app;
- Mobile and secure;
- Balances convenience, security and price.
- Less established on the market.
Cobo Vault Pro
Cobo Vault Pro wallet is a high-end hardware wallet which has by far the most built-in features. It comes in a form resembling a smartphone, with a large touchscreen and a camera for QR codes. While certainly larger than previous wallets, it is arguably more inconspicuous as it can pass off as a smartphone.
Cobo Vault encryption algorithms can be audited since it is open-source. The device is air gapped, meaning that it cannot be connected to any device physically or wirelessly. The transactions are broadcasted with QR codes on the wallet and in the mobile companion app.
For extra privacy and security, Cobo Vault Pro has a fingerprint sensor. It lets users create Hidden Vaults, which do not show up in the UI, and can self-destruct upon disassembling.
Essentially, Cobo Vault is a smartphone-like device dedicated to cold storage. Its price of $169 puts it into the high-end category of our list of best hardware wallets.
- Air gapped tamper-proof device;
- Easier to use thanks to larger size;
- Supports 750 coins and tokens.
- High-end price and long shipping.
Flash-drive-like BitBox02 is a follow-up model to the original BitBox01. The shape matters because the device can be plugged in to a computer without a cord. It also comes in the smallest frame out of all reviewed wallets.
BitBox02 comes in two variations: Bitcoin-only and multi. The difference concerns only software that comes with the device, and multi can be used as a physical authentication key. The Bitcoin-only version deliberately lacks the universal second-factor (U2F) authentication protocol to decrease the attack surface.
The wallets are compatible with most desktop OSs, and the Android version is in beta. The currencies supported by the multi version include Bitcoin, Ethereum, Litecoin and ERC-20 tokens, which is far less than other reviewed devices. Surprisingly, it also costs on a par with more high-end wallets ($132).
- Protection from chain supply attacks and fake devices;
- Convenient plug-in mode;
- Multi and Bitcoin-only variations.
- Analogous devices (e.g. Ledger Nano X) are cheaper.
What is the best hardware wallet 2021? There is no definitive answer but these are the top five best hardware wallets according to our team. Let us know what you think or share your favorites!