The simple analogies for hardware wallets.

[alani123]

Look HODLers, we have to find a way to teach people how to understand hardware wallet safety principles. I propose some simple to understand analogies. People like to learn through idioms you know. I'll give it a go.

Getting a used hardware wallet is like re-using a condom. Completely defeats the purpose.

Buying a hardware wallet from any third party other than the manufacturing company directly is like buying medicine from the vet store. Might be cheaper but could risk costing you literally everything.

Buying a hardware wallet with a sealed non-transparent casing is like buying a car and asking to paint the windshield with a thick cost of vantablack. You need to see what's in there so you can compare it to the original circuit designs and verify it has not been tampered with.

Buying a hardware wallet from a company that doesn't have a bug bounty program and/or doesn't encourage serious research to hack-proof their products is like making your money a guinea pig.

Putting your money in any wallet with closed source software is like putting it in someone else's lock box. You're probably not the only one with the key.

Getting an already etched private key store metal card is like finding a key in the middle of the street and asking the locksmith to design you a lock for it to put on your main house door.
Feel free to reiterate and have fun.


A funny AI image I promoted for your inspiration.

[Karl_3000]

What if you followed this and bought Coldcard and funded it with huge amount of bitcoin but later see the wallet has been taken over by hackers and before you know, the money sent there have all be sent to the hackers bitcoin address? Coldcard has almost all the characteristics that you mentioned but some people said it is not completely open source. I am afraid to buy an hardware wallet. I was planning to get Trezor when all these hack started which increase my fear to get any hardware wallet. I will wait for sometime to know what will later happen to another hardware wallet.

[Hatchy]

With the many attacks on hardware wallets we have seen this year, it's understandable that some investors are having second thoughts about purchasing these devices. Having a hardware wallet no longer automatically means your funds are safe, especially with the different ways vulnerabilities can be introduced. You also mentioned open source software, which allows independent researchers to inspect the code, but we all know that this doesn't guarantee complete security either.

There are many reasons to think twice before purchasing a hardware wallet, and honestly, based on my experience with them, I don't consider them reliable in the long run. A properly stored seed phrase written on paper or engraved on metal can last for ages, as long as you protect it properly. That aside, I completely agree that some of the risks associated with hardware wallets can be reduced by avoiding simple human errors. One example is buying from an untrusted third-party seller. It's better to purchase your hardware wallet directly from the manufacturer, but never assume that doing so guarantees 100% security.

[Pmalek]

...Coldcard has almost all the characteristics that you mentioned but some people said it is not completely open source.

It's not open-source at all. Coldcard's code is source-verifiable, meaning it's publicly available for scrutiny. If you know how to inspect and audit code, you can do that with Coldcard just like you can do with Trezor and any other open-source code.

Open-source means you can use the code however you like. Copy all of it, modify it, add to it, create your own product with it and sell it. You could create the Karl_3000 hardware wallet, keep it open-source and sell it.
Coldcard's source-verifiable code doesn't allow you to do that. A Karl_3000 hardware wallet couldn't be legally built and sold using Coldcard's code.

[Meuserna]

...Coldcard has almost all the characteristics that you mentioned but some people said it is not completely open source.

It's not open-source at all. Coldcard's code is source-verifiable, meaning it's publicly available for scrutiny. If you know how to inspect and audit code, you can do that with Coldcard just like you can do with Trezor and any other open-source code.

Open-source means you can use the code however you like. Copy all of it, modify it, add to it, create your own product with it and sell it. You could create the Karl_3000 hardware wallet, keep it open-source and sell it.
Coldcard's source-verifiable code doesn't allow you to do that. A Karl_3000 hardware wallet couldn't be legally built and sold using Coldcard's code.

THIS. Here's why it matters.

ColdCard's code was published and verifiable, but other devs couldn't use it in their own work, so they had no incentive to read it. Why bother?

But even if other devs did read ColdCard's code, there's a huuuge difference between reading code and using code in your own work. When you use somebody else's code in your own work, things can behave in unexpected ways and you have to dig into the code, line by line, to figure out why. That's where it becomes easier to find bugs.

The fact that Coinkite intentionally mislead users into thinking ColdCard's code was open source when it was not is a perfect example of why ColdCard, Rodolfo Novak (NVK) and Peter Gray (Doc-Hex) should never be trusted again. Never.

But too many people in this space are gadget-guys who think the calculators are cool, and Tangem cards are cool, and Ledger gadgets are cool.

Bitcoin is open source. Any code you use to secure your Bitcoin should be open source too. No exceptions. If your keys depend on code that isn't open source, you can't be sure your keys are safe.

Obviously, if you're only securing a few hundred bucks worth of Bitcoin, none of this really matters. But if you want Bitcoin to be part of your financial future, it makes no sense to even consider cool-factor, and it makes no sense to prioritize convenience over security.

[mindrust]

If you don't have a very very specific reason to own a hardware wallet, It means you don't need it. Most people don't need a hardware wallet. They need a well secured linux box (preferably offline but only if you are sending/receiving transactions online is OK too) and a piece of paper as a backup. That's a much better solution than a hardware wallet.

[alani123]

If you don't have a very very specific reason to own a hardware wallet, It means you don't need it. Most people don't need a hardware wallet. They need a well secured linux box (preferably offline but only if you are sending/receiving transactions online is OK too) and a piece of paper as a backup. That's a much better solution than a hardware wallet.

Well, the hardware wallet comes with the supposed benefit of having a secure environment out of the box. Most people can't update their software alone, let alone set up a secure linux environment by themselves in a trustless way.

[Pmalek]

ColdCard's code was published and verifiable, but other devs couldn't use it in their own work, so they had no incentive to read it. Why bother?

Right. Other people couldn't use it commercially and build their own products with it, but no one stopped anyone from scrutinizing the work, finding and making people aware of bugs and/or vulnerabilities. Where were all the "security experts" for five years while the entropy bug was publicly available but no one discovered it? Even if that code was open-source, I don't believe it would have made a difference. No one would notice a lack of security of a seed phrase until it's too late.

At the same time, I do agree with this:

But even if other devs did read ColdCard's code, there's a huuuge difference between reading code and using code in your own work. When you use somebody else's code in your own work, things can behave in unexpected ways and you have to dig into the code, line by line, to figure out why. That's where it becomes easier to find bugs.

[bitmover]

If you don't have a very very specific reason to own a hardware wallet, It means you don't need it. Most people don't need a hardware wallet. They need a well secured linux box (preferably offline but only if you are sending/receiving transactions online is OK too) and a piece of paper as a backup. That's a much better solution than a hardware wallet.

Well, the hardware wallet comes with the supposed benefit of having a secure environment out of the box. Most people can't update their software alone, let alone set up a secure linux environment by themselves in a trustless way.

Most people doesn't even know what is a Linux.

I can guarantee that 99% of the people have no what  idea of what a ' secured linux box' is, and shouldn't be trying to use one, because they lack the knowledge to do that correctly.

Hardware wallets are for these 99% people

[mindrust]

If you don't have a very very specific reason to own a hardware wallet, It means you don't need it. Most people don't need a hardware wallet. They need a well secured linux box (preferably offline but only if you are sending/receiving transactions online is OK too) and a piece of paper as a backup. That's a much better solution than a hardware wallet.

Well, the hardware wallet comes with the supposed benefit of having a secure environment out of the box. Most people can't update their software alone, let alone set up a secure linux environment by themselves in a trustless way.

Most people doesn't even know what is a Linux.

I can guarantee that 99% of the people have no what  idea of what a ' secured linux box' is, and shouldn't be trying to use one, because they lack the knowledge to do that correctly.

Hardware wallets are for these 99% people

Most people who don't have a basic sense of cyber security shouldn't be dealing with crypto in the first place. Hardware wallet isn't making it easier for them, in fact if they insist on staying dumb, they'll lose their coins eventually in the worst possible time.

They better trust banks with their money at this point if they can't bear the responsibility of securing a private key/seed words which is just a combination of a few words/letters.

They should be buying a Bitcoin ETF. Not a hw wallet.