Storage is one of the central questions of cryptocurrency.
The technology differs from the management of traditional currencies since crypto is decentralized and operates free of intermediaries, such as a bank, leaving individuals with complete control of their assets. In practice, a user’s digital currency assets are distributed across a network of computers through the blockchain, negating the need for a bank account.
What does all this mean for regular users? When it comes to storing cryptocurrency, holders are becoming increasingly familiar with the cryptographic concepts of public and private keys. For reference, the public key makes transfers between different people possible, similar to how an email works in an e-transfer. Working in combination with the public key is the private key, which is more similar to a password, a string of letters and numbers that guarantee a given cryptocurrency asset belongs to an owner.
Since this process poses complexities that a new investor would not be accustomed to, many digital exchanges have taken on this role as an intermediary holding the user’s private keys, replicating the user experience common in traditional banking. In the pursuit of a simplified experience, the cryptocurrency holder is willingly forgoing some of the control of their assets by leaving it with an intermediary.
This brings rise to concern, as a large reason we have digital currencies in the first place is to eliminate intermediaries and return full custodial control to the owner of the funds. Institutions like exchanges are not infallible: they may go bankrupt, taking their users’ assets with them, or another day they may seize a user’s funds. This has led many to conclude that if a holder isn’t in control of their private keys, they don’t really own your cryptocurrency funds. The contrary here is also true; only by owning your private keys will you achieve complete financial freedom.
With this in mind, how can cryptocurrency holders secure their assets on the blockchain without forfeiting their control? To this end, cryptocurrency experts will often recommend the use of a hardware wallet.
The hardware wallet is a device that allows the owner of cryptocurrency to store their private key in a secure chip. Since this chip exists separately from the user’s device, it is less subject to malicious hacks that may occur on a phone or desktop.
The reality of self-custody is that users are in sole charge of managing their private keys. This is where solutions that guarantee a user’s security and ownership, like Ledger, come into play.
A combination that gives users total control
Ledger is providing a solution that balances absolute security with practical utility while allowing users to retain total control of their crypto assets. Core to this offering is Ledger’s large collection of hardware wallets, with options for beginner and advanced traders.
Operating with the highest levels of security, including private keys being inside the device, an added level of protection and the fact that the wallet is always offline, cryptocurrency holders can rest assured that their funds are secure while being in their own holdings, ensuring only the user is in charge of their money and no third party is involved. That said, hardware wallets are typically the recommendation for those that plan to hold their assets long-term.
So, what about those who are actively managing and optimizing their portfolios?
Without taking away from a user’s ownership, Ledger recommends its offline hardware wallet to be used in combination with Ledger Live to eliminate usability barriers. This software enables the easy management of assets from a desktop or mobile solution. The combination of their hardware wallet and Ledger Live application allows users to manage their assets and transactions with a simple and clear interface. Hence, users remain in control from a management sense.
A gateway into the new world
The team behind Ledger continues to add to the capabilities of this solution, now providing functionality for the transacting of over 1,800 different coins and tokens. With continuous updates on their roadmap, the platform is well-positioned as a safe gateway for any cryptocurrency needs that may arise.
Exchange, lend, and other crypto transaction services are provided by third-party partners. Ledger provides no advice or recommendations on use of these third-party services.
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you with all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor can this article be considered as investment advice.