How does a hardware wallet actually work?

admin

As my amt of SOL has grown I am looking into security.


But what I don't get is how a hardware wallet works. Basically a hardware wallet holds your private key, and when you plug it into a device with internet you can sign transactions on the blockchain.


If you lose your hardware wallet the funds are still on the blockchain, you just lost your private key right?


New to hardware wallets, never had a portfolio of more than $100 🤣


Then isn't it possible to write down your private key on a piece of paper and that stores your private key just like a trezor or ledger does?

admin

If you lose your hardware wallet it doesn’t matter as long as you have your seed phrase. You would just restore from seed on a new device.

The whole point of a hardware wallet is so you don’t need to store a private key. Your device handles all that. You just save your seed phrase.

admin

It uses a Trusted Execution Environment (TEE) to store your seed phrase, which is a little part of a chip that never touches the internet. Its only function is to sign transactions, so your keys are never exposed.

And yes, if you lose your wallet your funds are also lost thats why everyone recommends to back up your phrase in at least 1 other place.

I suppose you do lose a little bit of security but its worth it in case the HW wallet gets lost, stolen, or damaged.