Does Using Multiple Hardware Wallets Actually Make Self Custody Safer?

[Opiate32]

We normally talk about self custody as reducing the need to trust exchanges and other third parties but when the wallet itself has a firmware problem, their is still some trust involved in the device and software used to generate and protect the keys. So I am wondering about something more practical; If someone has a significant amount of BTC, is it safer to spread the risk across different hardware wallets from different manufacturers or does that just create more complexity and more chance for the owner to make a mistake?

For example, would you personally prefer one well tested hardware wallet or a setup involving two different devices or vendor?

I’m interested in hearing from people who actually use this setups. What do you think is the best balance between security and simplicity?

[Zaguru12]

We normally talk about self custody as reducing the need to trust exchanges and other third parties but when the wallet itself has a firmware problem, their is still some trust involved in the device and software used to generate and protect the keys. So I am wondering about something more practical; If someone has a significant amount of BTC, is it safer to spread the risk across different hardware wallets from different manufacturers or does that just create more complexity and more chance for the owner to make a mistake?

For example, would you personally prefer one well tested hardware wallet or a setup involving two different devices or vendor?

I’m interested in hearing from people who actually use this setups. What do you think is the best balance between security and simplicity?

I will advice you use the search button for questions like this, there are many threads that have discussed this kind of set ups already.

For your question I will say yes the idea of actually using two or more different hardware wallet to actually split your coins is good and more secure than using just one hardware wallet but still doesn’t immune you to not losing some or all your coins most especially due to carelessness which storing the seed phrases together. I will also advice that you add pas phrase to each seed phrases too because that’s the actually true second layer security.

For someone like me I will actually be interested in a multi sig if I have three hardware wallets, each hardware wallets generates seed phrases plus I add pass phrases and then each hardware wallet is a co-signer and I do 2-of-3 multi sig wallet if the amount to hold is very huge this is by far better than a single sig

[Karl_3000]

Yes it is very good but use passphrase. If you have a very huge amount of money, the hardware wallets cost will be nothing but not expensive to you. Use trustworthy hardware wallets that have good history, Coldcard was later talked about bad on this forum long time ago before the incident happened. Make sure that you only get those that are open source also.

[hmbdofficial]

Self-custody does not remove all trust. It still depends on hardware, firmware, wallet software and the process used to generate and protect your keys.
For small amounts, one well-tested hardware wallet may be safer simply because there is less room for user error. For large amounts, using different devices or manufacturers can reduce the risk of one device vendor falling. Take COLDCARD for example imagine one had everything on the COLDCARD hardware wallet after this incident nothing is left for him to fall back.
A 2-3 multisig with device from different vendors can provide better protection because one compromised device is not enough to spend all the funds you have splitted.
However more devices doesn’t automatically means more security. The best setup is one that removes single point of failure while still being simple enough that you can properly back it up and recover it when needed.

[Italian Panic]

In my opinion, hardware wallets are no longer necessary because, ultimately, all you’re doing is handing over to third parties the responsibility for generating your private keys and storing your bitcoins; like a bank. I remain loyal to reputable software like Electrum, which features highly secure, open-source code and firmware verified by a highly competent community that acts as an auditor.
Electrum, installed on a live version of Linux and in offline (air gapped) mode, guarantees an absolute standard of entropy. It allows you to use unique, non repeatable parameters as entropy data, such as the response speed of the hardware’s logic gates, CPU cycles, hardware temperatures, and mouse movements.

[satscraper]

For example, would you personally prefer one well tested hardware wallet or a setup involving two different devices or vendor?

I’m interested in hearing from people who actually use this setups. What do you think is the best balance between security and simplicity?

I'd prefer different devices that could act as cosigners in multisig setup, which can be extended even with software based cosigner that can be used as a coordinator of the whole quorum. I tried both Liana and Sparrow for the coordination role, and both have shown perfect results. If you are put off by the multisig wallet, don't worry, the devil is not as black as he's painted.

[promise444c5]

Nope, but you can survive the case of not losing all your entire holdings incase any other hardware wallet ends up with another vunerability that can put users bitcoins at risk.. doesn’t mean you won’t still lose money.

Instead of wasting money  on buying 3~4 hardware wallet why not just add extra setups like what satscraper mentioned.. you will safe some money and still have all your money if  any thing related happens to the hardware wallet in the future.  You’re investing on knowledge instead of of extra hardware wallets..

Hence if you feel it could be complicated for you, keep a documentation on how to safely recover your bitcoins. The only thing left, is keeping it safe just as you will be keeping your seeds safe.

[Amphenomenon]

In my opinion, hardware wallets are no longer necessary because, ultimately, all you’re doing is handing over to third parties the responsibility for generating your private keys and storing your bitcoins; like a bank. I remain loyal to reputable software like Electrum, which features highly secure, open-source code and firmware verified by a highly competent community that acts as an auditor.
Electrum, installed on a live version of Linux and in offline (air gapped) mode, guarantees an absolute standard of entropy. It allows you to use unique, non repeatable parameters as entropy data, such as the response speed of the hardware’s logic gates, CPU cycles, hardware temperatures, and mouse movements.

It seems like you don't know how secure hardware wallet are and theor update?

The firmware vulnerability was found on one and I know there are other questionable ones but we also have more and better reliable ones and aside that Electrum can be used either hardware devices.

There are fully open source wallets which are more trustworthy with other key reasons to rely on them like their structure for private kkey creation but still the entropy is not the only thing that makes a wallet good or reliable.

[odolvlobo]

Your question is very similar to, "should I have two phones in case one breaks"?

The primary purpose of a hardware wallet is to provide secure access to your bitcoins regardless of the safety of the environment. You can safely use a hardware wallet on a computer that has malware because transactions are created, signed, and verified on the device. Using multiple devices does not improve that functionality.

The secondary purpose of a hardware wallet is to give you convenient access to bitcoins in cold storage. Multiple hard wallets may make that more convenient because if one device fails, you have another. However, if you have saved your seed properly in a secure location, then a second hard wallet is not as useful, as you can just get another one when your current device fails. Or if it is urgent, you can even use a software wallet (though the bitcoins would no longer be considered in a cold wallet).

[Meuserna]

Does Using Multiple Hardware Wallets Actually Make Self Custody Safer?

It depends on how they're used. Trezors are fully open source and the code is arguably the most used among hardware wallets. Other devs use it as part of their own work as well.

I think the average user would be better off with 2 Trezors, so they can wipe one out to test their ability to recover their wallet from scratch without risking losing access to the wallet, since the wallet is also on their other Trezor.

I understand that's not what you mean by "multiple hardware wallets" though.

For anyone who is securing more than a few thousand bucks worth of Bitcoin, I strongly believe the answer isn't more hardware wallets. No. The answer is a hardware wallet that is stateless, which means it doesn't save your seed or wallet on the device. SeedSigner, ShieldSigner, Krux and Kern are examples of stateless hardware wallets.

For serious self custody, I believe a wallet should be airgapped, stateless, and using a seed generated by a person, not a device.

Airgapped... so online thieves can't reach it.

Stateless... meaning the seed and the wallet get wiped when the device shuts down. If a thief steals it, there's nothing on it.

Human generated seed... roll dice 100 times. Or, print the BIP39 word list in columns so you can fit as many words on a sheet of paper as possible, along easily cuttable lines. Cut the paper into strips so each word is on a strip. Put the words in a large mixing bowl. Shuffle them. Pick a word. Write it down. Put the word back in the bowl and shuffle again. Pick another. Do this 23 times. It's perfectly safe to let a hardware wallet calculate the checksum word since you know the other 23 words are truly random.

Also, pick 10 more words. There's your passphrase, and it's uncrackable.

Currently, I believe the best hardware wallet at any price is ShieldSigner. It's SeedSigner with extra security features such as encrypted seed QR and passphrase QR. Passphrase QR makes loading a very strong passphrase easy. Krux is excellent too, and the hardware to run it is cheap. Kern is a newcomer to this space, but  I think it will be one of the best options a year from now as the project matures.

This kind of setup isn't right for newcomers. But once somebody has experience with wallets and understands that the seed is the wallet, not the device, then working this way makes sense and offers incredible security.

The problem, of course, is that most people think the device is the wallet, and people have a weird need to put their faith in a brand.