Today I got my KeepKey hardware wallet in the mail. Technically I picked it up from an amazon locker near my house because I knew my mail was likely going to be delayed due to a storm. I got it 2 days instead of what probable would?ve been 6 or 7 otherwise. Technology, right? It?s getting crazy out there, folks and bitcoin is becoming more and more ingrained in our increasingly tech-savvy world.
Recently, the price of bitcoin has been on a serious incline, and it got me thinking. What if the company that owns my web wallet went down, or even worse, got hacked? I would lose my entire investment, and would not be guaranteed of ever seeing any of it ever again. By using a web wallet, I simply do not own my bitcoins, that is to say I don?t own the keys. Whoever has the keys has the power to sign transactions and move the coins. I decided it was important for me to own my keys and control my currency, and looked into hardware wallets. I did a little research and narrowed my choice to three options, KeepKey, Trezor, and the Ledger Nano S. I decided to buy a KeepKey?for a few reasons. It was affordable ($99), it supports a variety of alt coins, had a large LCD screen, it is built on open source code, and it has been proven to be a reliable product with a solid reputation in the bitcoin community.
As soon as I un-boxed the?KeepKey, I realized how easy it was to set up. Install a browser extension to manage transactions, plug in the device and your off to the races. First step is to create a 4-8 digit pin code. This pin code is important as this is the only thing stopping you and someone else from making transactions with your wallet. Once I started setting my pin, I noticed that the numbers on the LCD screen changed, therefore making the device extra secure from other dangers like keyloggers.
Once I set my pin code, I was given a 12 word randomly generated passphrase. This passphrase is essentially your bitcoin wallet keys encoded into a text. It is vital to backup this passphrase, as it is truly the only thing you need to truly own your coins. If the device is lost or destroyed, I can simply enter my passphrase and my wallet will instantly be attributed to my new device. As long as my keys are safe, my bitcoins are safe.
Before depositing all my bitcoin into my KeepKey, I decided to test it. I sent a small transaction from a web wallet to my hardware wallet. It was received quickly, and I decided to try to send it back. Unfortunately, I was unable to send my bitcoin back to my web wallet, because the transaction was not large enough to pay for the transaction fee. Lesson #1: I now pay ALL fees for ALL transactions I make with my hardware wallet. If I own the keys, I own the fees. But this doesn?t deter me at all, because I purchased the?KeepKey?as cold storage for funds I do not want or need instant daily access too. I can keep the majority of my coins on my?KeepKey?and a smaller amount in my web wallets for day to day transactions. I ended up sending more coins over to my?KeepKey?and then eventually wending them back over to my web wallet. Unfortunately, I was a bit disappointed when I paid .00018 BTC?to make a $.0001 transaction. But again, this isn?t for daily transactions and fees should not be an issue when considering using it for safe storage purposes.
All in all, my first impression with?KeepKey?is very positive. It was extremely easy to set up. It was just as easy to wipe the device completely and restore it in less than 5 minutes. I do despise the idea of losing my passphrase key, but considering it is only 12 words, it isn?t something I can?t learn to memorize easily. Thats? the greatest thing about it, actually. It?s easy, but it?s also very safe. I?m very impressed with how simple everything was, and would recommend giving it a shot if you?re in the market for a hardware wallet.