How Does a Crypto Hardware Wallet Work?

how's it going everybody this is btw

bush today i'm going to talk about how a

hardware wallet works and how you can

get started in it first of all i've

owned kryptos for several years now

including a little bit of bitcoin a lot

of dogecoin and i've always wondered

about hardware wallets because i keep on

hearing it is more secure than keeping

all of this on a website somewhere

before i begin i'd like to thank ledger

which provided me with this ledger nano

x hardware wallet without them sending

it to me i would not have been able to

produce this video now cryptocurrencies

are stored on a distributed ledger which

is kind of like

who owes what how much coin is in each

wallet and all of this is in a

distributed nature so everybody you know

there's multiple copies of this and the

network

always tries to verify each other so

it's really hard to forge something like

this and in order to gain access to one

of the wallets and say okay i want to

use this wallet to send some coin

somewhere else you need some kind of key

and this key is the secret to accessing

your cryptocurrencies when you use a

hardware wallet it's not like you put

your bitcoins or dogecoin inside this

wallet and if you lose it you're gonna

lose it forever the way they make these

wallets is that it holds the key

to

your crypto that is secured on the

network your crypto resides

on in the cloud somewhere across all

these different computers that has

copies of the ledger itself some people

might have like 10 000 bitcoins a lot of

money in one of these things and if you

lose it this is a huge deal

which makes you feel like

if you have a hardware wallet you don't

want to carry it around right because if

you lose it you don't want to lose

everything that you have but this is not

the way these things work if this

hardware wallet is lost or stolen

and some random guy goes and opens it up

right and then press the button and go

okay how do i access this and let's say

they have one of these as well they know

how to use it but the first thing that

comes up is it asks you for a pin code

without the pin code you cannot do

anything with this wallet you cannot

access all the stuff that's inside and

let's say you lose it and it was stolen

by a sophisticated hacker that knows how

to hack hardware this is what they say

there is a low risk that if your device

is

lost or stolen an experienced hacker

with engineering skills who has access

to the physical device could extract the

recovery seeds usually with these crypto

devices with security minded devices

they have built-in chips that have

security protocol in it that it's going

to hide a bunch of information within

the chip itself so it's not like you can

like rip open the chip and then

go and probe it or something even within

the chip itself it is encrypted as well

so you absolutely

need the pin code in order to even start

anything so when you lose this device

you don't lose all your bitcoin or

dogecoin

you have a copy of these 24 word seeds

you have to write this down somewhere

and they give you three cards to write

these 24 words and you're supposed to

keep them secure and these cards

is your actual wallet if you have access

to these cards or if someone stole these

cards then yes they can access your

cryptocurrencies if you actually lose a

hardware wallet it's not that big a

security breach you can actually wait a

while wait until your hardware wallet

comes it has a new recovery seed

and then you import all of those assets

from your old wallet that you lost

into your new wallet so you can think of

this as

your crypto assets goes with this 24

word recovery seed if you are kind of

nervous about

having your cryptos hang in midair

without you having a hardware wallet you

can actually get a software wallet

and then import all of those assets in

your software wallet just for the time

being and then when you get your

hardware wallet you re-import them again

and just go and put them

into your hardware wallet there is a pin

code if you enter in your pin code wrong

three times it's going to wipe the

device and then

it's as if you have a brand new wallet

over here it doesn't know anything about

anything so you're gonna have to start

it new again and then use your 24 word

recovery seed and then put those assets

back in here i have some dogecoin in

coinbase

i have a lot of dogecoin in uh robin

hood which right now they don't have

wallets yet i'm like number

957 000 or something but when they do

have wallets i can be certain that i can

just transfer as much as i want from

robinhood into this little hardware

wallet thing but for now i can do it

with coinbase which has

a

address

of you know my dogecoins and then i can

just

take the address from

this thing and then go on my coinbase

send it to

the address over here and you know i

sent 50 dogecoins the network fee is

actually 1.44 doge this equates to about

30 cents or so for me sending about 11

so this is

a little high it's like 3 or so it also

said the payment will be receiving an

estimated about six hours but um in my

experience when i sent it from coinbase

into my hardware wallet the time it took

was almost instantaneous so i didn't

even have to wait an hour or two it just

appeared right away now when i received

this device i was kind of nervous right

because i'm on the internet and i don't

want

some random person

hacking this device beforehand

and then sending it to me so i was a

little nervous there about using this

that's also why i only put a little bit

of dogecoin in there at first the way to

get a little bit more confidence is that

ledger is a company in france so

hopefully this package is arriving from

france and not somewhere in the middle

of russia or somewhere so i got that

check and also when i plugged this in it

also have a little check mark next to

the ledger nano x over here and it says

the device is genuine so

i need to trust

ledger in that

they have some way of you know verifying

the authenticity of this thing that it

has not been tampered with so this check

mark is another thing that can help uh

prove to yourself that this thing is

legitimate and that you know you're not

getting hacked or conned out of your

hard-earned cryptocurrencies they do

have a cheaper version than this ledger

nano x version they have the ledger nano

s which is 59 this one is 119

you have to install apps

to make it compatible with certain

cryptocurrencies so whichever ones that

you need to use you add those apps in

here one thing i did notice is that this

thing

has two megabytes of

storage you don't need that much storage

in order to store 24 words the ability

to secure

something that's inside so that it's

very hard to hack that's where the cost

comes from when you have the hardware

wallet it works in conjunction with an

app on your phone if you want to receive

bitcoin or dogecoin then you can show

the other person your qr code and then

they can do the transaction that way or

if you want to buy something you can use

your app

scan the qr code

of the merchant that you want to pay and

then you can pay with your wallet right

now not a lot of merchants will accept

dogecoin so there are places where you

can look up a map and it will show you

which merchants accepts it once dogecoin

becomes more widely accepted yes i'm

gonna go out there and and spend my

dogecoin a little bit more if you guys

are interested in getting a ledger nano

x or s check out my referral link down

in the video description below thanks

for watching

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