Since the cryptocurrency market has expanded so much, buying cryptocurrencies has never been easier. With many exchanges supporting cryptocurrencies, anyone can create an account and buy the cryptocurrencies they desire. However, since cryptocurrencies are virtual, storing them is not as simple as storing cash. Because of this, there are plenty of cryptocurrency wallets that are now available for storing your cryptocurrencies. While the conventional wallets are online and usually software, there are also physical hardware wallets that people can use. One of the most popular and trusted hardware wallets in the market is Ledger wallets.
In this article, we are going to cover everything you need to know about Ledger, its wallet types, pros and cons, and much more. Let’s begin with an overview of Ledger.
What is Ledger?
Launched in 2014, Ledger was founded by a French company that has the same name, Ledger. The purpose of cryptocurrency wallets is to store private keys so that hackers cannot access your assets. The purpose of Ledger was just that, but to do it completely offline.
Ledger started with Ledger Nano S. It ultimately became one of the best cryptocurrency wallets to exist in the cryptocurrency market. Even though newer wallets have been launched in the market, the Ledger Nano S remains one of the most popular and highly rated wallets in the world.
After Ledger Nano S, the company released the Ledger Nano X. The purpose of the latter was to improve some of the features of Ledger Nano S, as well as add new ones to the Ledger wallet. While Ledger Nano S was very suitable for cryptocurrency holders (HODLERS), the Ledger Nano X was designed in such a way that even active traders could use it. Perhaps the reasons for this might be the fact that the Ledger Nano X involves mobile usage, a bigger screen, Bluetooth communication (end-to-end encrypted), more battery power, etc.
We keep mentioning hardware wallets, but what exactly is the purpose of having such wallets in the market?
What is a Cold Wallet?
The reason why hardware wallets are also called cold wallets is that they are completely offline.
The most used wallets are online, software wallets, which people refer to as hot wallets. The problem with such wallets is that you need to be connected to the internet if you want to access your assets. However, having access to the internet makes you vulnerable to computer malware. You can give access to hackers unintentionally by clicking a link, opening an email, or any other way. Sophisticated malware can get past your firewall, steal your private information, and access your hot wallet, consequently misusing it and stealing your coins.
Cold wallets, on the other hand, are completely offline. Such wallets are very simply designed. The simpler the divide, the less vulnerable it is to hackers. These wallets are not in any form connected to the internet, so it is practically impossible for someone to hack them.
Cold wallets (i.e. Ledger) are usually shaped like USB flash drives. Similar to other wallets, accessing your cold wallets requires a seed phrase, which is usually a set of 12 to 14 random words, and a password. When getting the seed phrase, you should write it down somewhere safe. It is recommended that you do so on a piece of paper because you do not want to have your seed phrase written somewhere in a computer, where a hacker might have access to if your computer is hacked.
But how would you trade with a cold wallet if it is completely offline? The answer is simple. The hardware wallet still needs to be connected to a computer just so you sign the transaction with a private key. However, this is not a direct connection, and your cold wallet is not in any way vulnerable to online attacks. You just connect the wallet to authorize the trades that you have requested in the trading platform that you use.
Related: Top 9 Cryptocurrency Wallets in 2021
Ledger Nano S Pros and Cons
Below we have listed the pros and the cons of Ledger Nano S
Pros
Supported Cryptocurrencies
When it comes to cryptocurrency support, Ledger Nano S is very suitable. It supports more than 100 cryptocurrencies and more than 1,000 tokens. Even stable coins such as Tether (USDT) are supported.
Security
Perhaps the biggest reason why people choose cold wallets such as Ledger Nano S is the security behind them. Ledger has a Secure Element (SE) chip that protects your private keys. It also has its operating system (OS) that operates with the Secure Element Chips called Blockchain Open Ledger Operating System (BOLOS).
Furthermore, each Ledger device undergoes an audit from the authorities (ANSSI) to make sure that the devices are safe. Moreover, in terms of practical safety, authorizing the purchase of a cryptocurrency requires the users to press both buttons at the same time, so a hacker would not be able to perform such an act unless he/she has the physical hardware.
The Ledger Nano S requires a four-digit password and a seed phrase of 24 words, which is more than other wallets.
There was only one concern when it came to Ledger’s safety. In 2020, Ledger’s customer data was breached, revealing all the names of the customers. However, wallet information was not exposed.
It Is not Expensive
When compared to other cold wallets, Ledger is one of the cheapest in the market. Its current price is $59 (shipping not included). While hot wallets might be free, they are not as safe as Ledger Nano S. The security that this wallet brings to investors is definitely worth the money.
Cons
Limited Storage
Since cryptocurrencies require an application for using them, wallets need to have space for such applications as well. Unfortunately, the Ledger Nano S supports only up to six crypto apps. This is the biggest setback that Ledger Nano S has.
Display
While it may not strike others as a downside, the display of Ledger Nano S is not the best in the market. The screen is very small, and it only has two physical buttons that are used to navigate through the features of the device. Because of this, the Ledger Nano S is a little hard to use.
Not So Mobile-Friendly
As suggested earlier, cold wallets need to be connected to a device when you want to trade cryptocurrencies. Ledger Nano S is not very suitable for mobile phones because only Android devices are supported. However, connecting to a computer is possible.
Ledger Nano X Pros and Cons
Below we have listed the pros and the cons of Ledger Nano X.
Pros
Supported Cryptocurrencies
Similar to its predecessor, the Ledger Nano X supports more than a thousand cryptocurrencies. This has benefited largely investors who diversify.
Easy to Use
While it is not very different than the Ledger Nano S in terms of display, the Ledger Nano X is much easier to use. It has simpler navigation and transactions can be authorized very easily.
Security
In terms of security, the Ledger Nano X does not differ much from the Ledger Nano S. They are two of the most secure wallets in the market. It is technically impossible for hackers to steal your private keys unless they get a hold of the physical hardware wallet. Even then, the hacker would need the password and the 24-word seed phrase. Unless they force you to type them, your assets are very safe.
Encrypted Bluetooth
One key addition that the Ledger Nano X has and Nano S does not is the end-to-end encrypted Bluetooth addition. Users can easily connect their Ledger Nano X wallet with a device through Bluetooth. While some were skeptical that Bluetooth connection entails less security, that has not been the case so far since it is encrypted.
Up to 100 Apps
Another great addition that Ledger Nano X has is the app support it has. It supports up to 100 cryptocurrency applications, unlike the Ledger Nano S, which supports only a few cryptocurrency applications. While many might still argue that even the support of 100 apps is limited, it is greatly larger than its previous version, and a considerable number for a cold wallet.
Cons
More Expensive
Since Ledger Nano X has more features than Ledger Nano S, it is understandably more expensive. The price for a Ledger Nano X wallet is $119 (shipping not included). While it may seem expensive for a wallet, the added features, such as Bluetooth, app storage, ease of use, and a lot more make the price of Ledger Nano X reasonable.
Heavier
A rather minor disadvantage that the Ledger Nano X has when compared to Ledger Nano S is that it is heavier than the latter. Many do not have an issue with this, but some user reviews suggest that it is not very practical to keep with you at all times.
Confusing to New Users
If you have not used a cold wallet before and a Ledger Nano X wallet is the first one, it might seem complicated at first. However, once you grasp all its functions, you may not find it difficult anymore.
Irreplaceable Battery
Another small setback for Ledger Nano X is that it does not have a replaceable battery. If the battery is somehow destroyed, you need to buy another wallet. Nevertheless, the battery is designed to live for around five years.
How to Set Up and Use the Ledger Wallet?
Below we will show you step by step how to set up and use the Ledger Wallet.
Step 1: Buy a Ledger Wallet
The first thing you need to do is buy a Ledger wallet. To do so, go to Ledger’s official website and order either a Ledger Nano S or Nano X. Make sure to only purchase on their official site so that you avoid the chances of being scammed.
Step 2: Download the Ledger Live App
Once you get your wallet, you have to download the Ledger Live app either on your mobile device or computer. Connect the wallet with the device when you open the Ledger Live app.
There, you will be asked to create a PIN for your wallet. Once you set up a PIN, the app will display the 24-word seed phrase, with each word coming one by one. Make sure to type the seed phrase in the correct order.
Once you write down your seed phrase, you must store it somewhere really safe. Ledger has another product called the Cryptosteel Capsule, which is a solid capsule you can use to store your seed phrase. This capsule is designed to resist “extreme conditions”.
Step 3: Install crypto apps using the Ledger Live app
Once you set up your wallet, you can install crypto apps using the Ledger Live app. For each cryptocurrency you plan to use, you need to install an app. To illustrate, if you want to use Ethereum, you need to install the Ethereum app, and so on. The Ledger Live app and the booklet instruct you how to use the two buttons of the wallet. For instance, if you want to confirm something, you should press both buttons at the same time; if you want to open the dashboard interface, you should press and hold the two buttons, etc.
Frequently Asked Questions (FAQ)
How to change my Ledger Nano X password?
To change the PIN of your Ledger wallet, you should type the PIN incorrectly three times so that the device resets. Once it is reset, you should type the 24-word seed phrase to restore your private keys, and then you can set a new PIN.
How to turn off Bluetooth in Ledger Nano X?
You can use the USB cable if you do not prefer using Bluetooth. Simply hold both buttons to open Control Center. Then, you can easily turn off Bluetooth.
What is the battery life of Ledger Nano X?
Ledger Nano X has a 100mAh battery. It can last months if the wallet is not used and idle. If it is regularly used, the battery can last hours. If you want to recharge you may use the USB cable that comes with the wallet.
Are Ledger wallets waterproof?
No, Ledger wallets are not waterproof, and you should keep them away from water. If there is contact with water, do not use your wallet until it is completely dried.
Does Ledger need to be plugged in to receive crypto?
No, you can receive funds in your Ledger wallet without connecting them to a device.
Also Read: Cryptocurrency Wallet Definition – What are Crypto Wallets?
Takeaways
- Ledger is a cold (offline) hardware wallet created by a French company with the same name.
- There are two Ledger wallet types: Ledger Nano S and Ledger Nano X.
- Ledger Nano S is the earlier version and is one of the most successful cold wallets to exist
- Some of the advantages of Ledger Nano S are that it is relatively cheap, secure, and supports a lot of cryptocurrencies.
- Some setbacks of Ledger Nano S are its limited app storage, display, and not too much mobile support.
- Some pros of Ledger Nano X are its increased app storage, cryptocurrency support, security, Bluetooth, ease of use, etc.
- Some cons of Ledger Nano X are its price, weight, irreplaceable battery, etc.
- To buy a Ledger wallet, you should use Ledger’s official website.
- When setting up your wallet, you should type your seed phrase somewhere safe. You can purchase the Cryptosteel Capsule to safely store the written seed phrase.
- When using the Ledger wallet, check the official instructions on how to use the two buttons of the wallet.