How to secure ERC-20 tokens using a Hardware wallet
on April 7, 2018, 10:26 p.m.
One of the main concerns of a crypto investor is to ensure the security of his/her ERC-20 tokens using a hardware wallet; which is the most secure way to store Cryptocurrency. One of the best inventions in technology over the years is the introduction of Cryptocurrency into the market. Cryptocurrency is expected to revolutionize the financial institution the way e-mail did to the communication sector.
The world of cryptocurrency has an amazing potential for growth, and at the same time, the danger of investing in it is also very high. Cryptocurrency has enjoyed great support of recent; more people are getting involved in the cryptosystem to experience the immense benefits it presently offers. Protection within the techno-savvy world may be very complex. It seems that nearly every day there’s another document of a first-rate hacking or ransomware violation. And because of the number of hacks growth, client goals for safety boom as nicely. The promise of blockchain generation and the energy of cryptocurrencies is their security. Blockchain makes it not possible for someone to hack into your cryptocurrency and thieve your funds it for the reason that blockchain is entirely at ease through the dispensed ledger that creates the chain.
It is wise to ensure that a secured crypto wallet is used to store your Bitcoin, Ethereum, and other Cryptocurrencies to prevent loss of your hard earned currency. Keeping your token on an app, at an exchange is a hazardous thing to do. You usually use different types of wallets for different purposes. However, when you don’t use your ERC-20 token, you should transfer them to a hardware wallet for safe storage. A hardware wallet is a device that is modeled to ensure your ETH and tokens are safe. In other words, it’s intended to be safe. Your Token (private keys) is encrypted on the device and kept offline for extra security. That way, your ETH is protected against computer hackers and malicious viruses on the internet. You should always use a hardware wallet alongside the online wallet at the exchange where trade your Cryptocurrency.
What is a Cryptocurrency?
There are a lot of definitions of what a cryptocurrency is. The best way to explain it is “Cryptocurrency is a decentralized digital currency.” The chief beauty of cryptocurrency is in its decentralization, i.e., not under control of any governmental policy.
What is a cryptocurrency wallet?
A cryptocurrency wallet is a digital wallet that you can use to store, send and receive various cryptocurrencies. The wallet doesn’t precisely “store” your money as a real-world wallet does. Instead, it saves your public and private keys which in turn help you send and receive money.
What is an ERC-20 token?
This refers to a common list of rules for all the Ethereum tokens to follow. This simply infers that this particular token enables developers of all types to accurately predict how new tokens will fare within the larger Ethereum system. ERC-20 makes things a lot easier for developers, as projects do not need to be executed again each time a new token is released into the crypto market. Rather, they are designed to be compatible with new tokens, provided those tokens adhere to the rules. Developers of new tokens have by-and-large observed the ERC-20 rules, meaning that most of the tokens released through Ethereum initial coin offerings are ERC-20 compliant.
What are hardware wallets?
Hardware wallets are physical devices where cryptocurrencies are stored. They are in many forms, but the most prominent is the USB stick style typified by the Nano Ledger series. Although it seems to be the best bet for safety, hardware wallets are still susceptible to compromise. Firstly, you’re trusting that the company who manufactured your wallet hasn’t logged all the private keys with a plan to hack wallets in the future. This applies to those gotten directly from the company, but particularly if a hardware wallet has been gotten from another user. Under no condition should anyone ever use a hardware wallet that has been used before by another person. In case of a situation where loss or damage occurs, it can spell disaster for a user that is unprepared; the hardware wallet can be restored. It is wise to backup hardware wallet just like thee online wallet. You should keep backup details in a safe place that only you have access to, and anyone you plan to give the wallet details. Remember to backup details about the wallet. Be very cautious of who (if anyone) you share them with. It’s also critical that you transfer all coins to a new wallet, should something terrible or hazardous happen to you and anyone else who knows your private keys (spouse, etc.)
Examples of hardware wallets that you can use:
How to transfer ERC-20 tokens to a ledger
Ethereum and ERC 20 tokens can be held and transferred using a variety of types of wallets. Ledger is a standard hardware wallet use to transfer and store both ether (ETH) and ERC 20 tokens (ethereum based tokens). To deposit ETH or ERC 20 tokens, you’ll need a Ledger wallet that supports Ethereum. Any newer Ledger, such as the Nano S or Ledger Blue will be compatible with ethereum, while the Nano and HW.1 wallets are not. To transfer ETH or ERC 20 Tokens, first, you will need to install the Ethereum app. The Ledger Nano S and The Ledger manage Ethers (ETH, ETC) tokens. It works on Windows (7+), Mac (10.8+), Linux or Chrome OS. It requires Google Chrome or Chromium, and one USB port to plug your Ledger Nano S or your Blue. It doesn't work on Android and iOS. The Nano and the HW.1 don't support Ethereum.