What is the way out when an hardware wallet is compromised?

[Aliosky]

I've been reading forum and websites to gain knowledge more about bitcoin, As a newbie I've come across some aspects that are still unclear to me. I've made the decision to inquire with the hopes of receiving a more empathetic response.

I've seen numerous websites and articles that consistently advise using a hardware wallet to store bitcoin, yet I have the concern regarding hardware wallet.

-What happens if the hardware wallet is defective or compromised? Is there an alternate route.

- Which other wallet is ideal for storing bitcoin?

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[hosseinimr93]

-What happens if the hardware wallet is defective or compromised? Is there an alternate route.

With using a good hardware wallet, you can be sure that your keys are never connected to the internet and it's impossible that your wallet gets hacked. Therefore, as long as no one has access to your seed phrase, there's nothing to worry about.
By good hardware wallet, I mean an open-source hardware wallet which is really air-gapped.

- Which other wallet is ideal for storing bitcoin?

You can use electrum on an air-gapped device. Creating such a wallet is difficult for most people and using a hardware wallet is the best option for them.

[mk4]

Defective? Simply contact customer support and ask for a replacement. Compromised? Compromised in what way? Hardware wallets requires a PIN code to access the wallet so you should be fine as long as you didn't pick something stupid like 000000, 111111, 123456, etc.

[dkbit98]

What happens if the hardware wallet is defective or compromised? Is there an alternate route.

Like any defective item you purchase, you will return it and receive refund or replacement device.
Most cases of compromised devices is made by mistake or users with exposing seed words, and most other cases can be avoided using multisig setup
Alternative option is to make your own DIY signing device like SeedSigner and Krux, or use old laptop as offline airgapped device.

Which other wallet is ideal for storing bitcoin?

There are no ideal wallets for Bitcoin.
Best hardware wallet should be open source, airgapped, tested by security experts, and not very expensive.
I made a list of currently available open source hardware wallets:
https://bitcointalk.org/index.php?topic=5288971.0

[un_rank]

-What happens if the hardware wallet is defective or compromised? Is there an alternate route.

- Which other wallet is ideal for storing bitcoin?

- This is likely to happen if you purchased the hardware wallet from an unverified third party selling on an online platform. In this case you could have a wallet which already has the keys generated and is in the possession of someone other than you.
If any device you use for crypto is compromised, discontinue using it asap and move any funds you may have there. Then you can seek a replacement or a refund.

- A reputable, open source, non custodian wallet
Could be a hardware or not and you should be able to verify how the keys are generated.

- Jay -

[nakamura12]

If that's what happened to you then you should contact their customer support and inform them about the hardware wallet you just bought from them. If no response or whatsoever then there are alternative that you can use such as electrum wallet that many people use because Electrum wallet is proven be trusted. The only problem you have to solve is to keep your wallet safe and secure by storing the recovery phrase of your wallet which is the 12 words that needed when you access your wallet. Anyway, just make sure you buy hardware wallet from legit seller or verified seller.

[jackg]

What happens if the hardware wallet is defective or compromised? Is there an alternate route.

This likely depends on how "defective" the device is. If the device is defective somehow and can't produce random numbers properly for example, there's no need to worry as the computer you're using can still add randomness to the numbers the device generates (as it's designed to do).

If you make a wallet, go to sign a transaction and realise a button doesn't work, that's something to contact the manufacturer about to get it replaced. If, later on, the button doesn't work or the screen goes dark for the final time then you should have a mnemonic phrase written down which is all you need to be able to recover your wallet.

Which other wallet is ideal for storing bitcoin?

This is based on user preference. If you're storing a lot of funds either an airgapped or multisig hardware wallet will be the best to use. If you're not storing much and want to use some funds for day to day transactions (less than $100 for example) you might only need a mobile wallet.

[Plaguedeath]

1. You have no way to know if your hardware wallet is compromised or defective because when it's happen, all of your coins will be moved to their wallet, so your hardware wallet is already useless. You have to trust the company if you're trying to buy hardware wallet and you need to make sure the seller is verified from the official site.

2. You can create secure cold storage using Electrum https://electrum.readthedocs.io/en/latest/coldstorage.html But you need to know the whole step to make it secure, like verify the signature, make sure your device is secure and 100% offline etc.

[KiaKia]

If it's defective you are to return to the official company, I am sure they will replace it for you and if it's compromised then it's the users own stupidity, hardware wallet are very secured than any other, scammers will need the physical wallet to trigger a transaction, so it's rare to get your hardware wallet compromised. Even if it's does there is no other route to anything, being compromised means the user did something very stupid.

[Lucius]

~snip~
-What happens if the hardware wallet is defective or compromised? Is there an alternate route.

If the HW is broken, and you have a backup (seed words), you always have the choice to make a recovery in a new HW, or in any desktop/mobile wallet that accepts your seed (although this is not recommended for security reasons). In the event that your HW is compromised in such a way that someone managed to hack it, then it's game over because the attacker will send all the coins to their addresses and you will be left without everything.

Defective? Simply contact customer support and ask for a replacement. Compromised? Compromised in what way? Hardware wallets requires a PIN code to access the wallet so you should be fine as long as you didn't pick something stupid like 000000, 111111, 123456, etc.

It is unlikely that someone will decide to guess the PIN and be lucky, at least as far as the Ledger HW is concerned, which will be reset to factory settings after three incorrect PINs, although the Trezor has as many as 16 attempts before the device is reset, so a thief would have a much better chance to guess a very simple combination.