Last Updated On November 14th, 2018
The historic Q4 2017 cryptocurrency bull run brought many new investors to the market. Throughout 2018 thus far governments around the world have announced new proactive stances toward cryptocurrency legislation, while new and promising blockchain platforms are launching on a weekly basis.
This surge in market confidence is now bringing in new waves of investors seeking to capitalize on the rapidly growing cryptocurrency market. While cryptocurrency investments may be profitable, however, they also require careful storage.
The decentralized nature of cryptocurrencies allows investors to “be their own bank”, but it also means it’s necessary to secure your own capital. A cryptocurrency wallet only consists of two elements — a public address and a private key. If your private key becomes compromised then it’s highly likely that you’ll lose access to the entirety of your cryptocurrency assets.
In this review, we’ll take a close look at the Trezor, which is widely regarded as the most secure method of storing cryptocurrencies. We’ll also explore the importance of strong security practices when investing in cryptocurrency and provide a detailed guide on how to set up your Trezor device.
The Importance of Wallet Security
The cryptocurrency ecosystem is home to thousands of different scams, fraudulent phishing websites, and hacking attacks that aim to “decentralize” cryptocurrency investors from their capital. It’s never safe to assume that your cryptocurrency holdings are secure. Hot and cold wallets – “hot” wallet hosted by an exchange or a broker like Coinbase or GDAX, is one of the least secure methods of cryptocurrency storage.
The core issue of it is that the exchange or platform hosting it manages private keys on behalf of users. If the platform becomes compromised, then so too does the wallets it hosts. The infamous Mt Gox hack is a good example of why they are a risky storage medium for large amounts of cryptocurrency.
Instead of trusting your crypto-capital to an exchange or broker, it’s best to utilize a “cold” wallet that is disconnected from the internet and provides control over private keys. It comes in many forms, such as software wallets, which are installed on a smartphone or computer.
While they are far safer than hot wallets, it’s still possible that the device that it is installed on may become compromised. As such, hardware wallets provide the ultimate solution for security. They are dedicated devices that generate a wallet internally, never divulging private keys to the user, and are generally considered impenetrable.
There are several different hardware wallets available on the market today, but the first and most popular solution is the Trezor. Widely regarded as the “gold standard” of cryptocurrency security, it is essentially a “vault” for your cryptocurrency capital.
We’ll proceed to take a close look at the device and assess its features, security, and ease of use. We’ll also deliver a basic step-by-step guide on setting up your device to help you keep your crypto safe.
What is the Trezor?
The Trezor was the first to hit the market in 2014, and is manufactured by SatoshiLabs. It is roughly the size of a car key or slightly larger than normal USB drive and connects to a computer via USB.
It is designed from the ground up to operate as a completely secure device and has one purpose — the secure storage of cryptocurrency. To achieve this, it doesn’t make private keys available to users. These private keys aren’t stored by SatoshiLabs — they’re locked away within the device itself.
The device consists of a small plastic chassis that houses a small OLED display screen, along with two physical buttons. These buttons are utilized to interact with the Trezor, as well as confirm transactions sent from the device. This adds an extra layer of security, preventing unauthorized parties from transacting with the device.
Unlike the Ledger Nano S, which manages coin support through the installation of apps, the Trezor ships with support for a variety of different tokens. The wallet is a simple desktop application that facilitates the management of cryptocurrencies stored on the device.
Trezor updates the list of supported currencies with every firmware update, which occurs frequently. These updates often include ease of use updates and additional security features. Overall, the device is simple in design and function — simply connect it to a computer, transfer crypto to it, and disconnect it. The device then keeps cryptocurrency absolutely secure.
What’s in the Box?
The Trezor comes in a box that is wrapped with a security seal, as well as a thin plastic foil. Trezor ships it like this to ensure that their devices aren’t tampered with. If you purchase a device and it doesn’t come with security seals intact, it’s important that you don’t use it to store any currency.
It’s extremely important to ensure that you either purchase the gadget directly from Trezor (link here) or from a reputable Amazon seller. Never purchase a second-hand device, as it’s highly likely that the device has been tampered with.
Each device is packaged with a USB cable, two booklets that are used to write down recovery seed information, a lanyard, a user manual, and four stickers. It’s also possible to use a range of accessories with the device, including an “OTG” cable that allows users to connect the Trezor to an Android device.
Ease of Use
The device is geared toward more technically-inclined cryptocurrency investors, and thus has a more complex setup process than other solutions such as the Ledger Nano S. Trezor provides extensive documentation for users that breaks down every step of setting up and use.
Connecting the device to the Trezor Wallet software is performed quickly and easily via USB. Navigation on the device itself is facilitated by two hardware buttons and a built-in screen, which provides information on the device addresses, balances, and various settings.
Trezor also provides support for a wide range of third-party wallets. The device integrates directly with the popular MyCelium wallet, MyEtherWallet, MyCrypto, and Electrum, making it one of the most widely supported devices available on the market today. Connecting your Trezor to these wallet apps is simple and intuitive.
How does Trezor work when it comes to usability, though? The device Wallet software operates through a browser plugin and delivers a wide range of streamlined features. It’s possible to both set-up and recover a Trezor device, manage a contact list of addresses, creates and work with multiple accounts, customize the home screen of the Trezor, wipe the device, and update firmware via this app.
The Trezor browser extension makes transferring funds from online platforms to the device extremely painless. Coinbase to Trezor operations, for example, involves simply connecting your gadget to your computer and providing Coinbase with your Trezor wallet address, then sending.
The Trezor password manager is a key feature of the gadget that dramatically enhances ease of use not only for the storage of cryptocurrency but also for the storage of secure passwords for any platform. This eliminates the threat presented by a “master password” for any standard password manager becoming compromised.
The physical design of the gadget is less ergonomic than other devices, such as the Ledger Nano S, but what it lacks in visual appeal it makes up for with security. The housing of the gadget is plastic but is robust and impact-resistant.
The Trezor itself can be attached to a lanyard or a keychain, and the large screen offers a distinct advantage over the Ledger Nano S. It’s possible to view wallet addresses via QR codes with the Trezor, which is a major feature.
The buttons on it deliver smooth tactile functionality and can be used to manage the gadget as well as confirm transactions.
The Trezor supports a wide range of cryptocurrencies out of the box and doesn’t require much fiddling around to get it working with any of them. It currently supports Bitcoin, Litecoin, Dash, Zcash, Bitcoin Cash, Bitcoin Gold, Ethereum, Ethereum Classic, Expanse, UBIQ, NEM, Namecoin, Dogecoin and Bitcoin Testnet.
Does Trezor support Ethereum? Yes — notably, the device is compatible with all ERC20 standard tokens issued on the Ethereum blockchain, of which there are many. A large portion of the ICOs launched recently operate exclusively with ERC20 tokens, so if you’re looking for a secure method of storing the tokens purchased in ICO sales, Trezor is a great option.
The Trezor supported coins doesn’t include a number of popular tokens, but as the firmware is updated more coins should be supported. Trezor Bitcoin support is extensive, while Trezor Ripple support and Trezor Money support is nonexistent.
The Trezor is arguably the most secure cryptocurrency wallet on the market today. Each hardware wallet offers a series of different authentication methods to ensure no malicious party is able to gain access to the capital it contains.
Firstly, all devices are secured with a PIN code of up to 9 digits. Most users set up a 4-digit PIN for the Trezor, which would be virtually impossible to brute force — every time a wrong PIN is entered, the wait time until a new attempt can be made is increased by a factor of 2. Trying the top 15 PINs, for example, would take 18 hours. After 15 failed attempts, the gadget wipes itself completely.
Should your it be lost or wiped, users are able to recover their wallets and the capital therein. During the setup process, users are provided with a “recovery seed” phrase that consists of up to 24 words.
This recovery phrase can then be used to load a lost wallet onto a new device, with no chance of the wallet being accessed by a third party. The security features of the Trezor don’t stop there, however — the Trezor team has thought of virtually every kind of attack possible when designing the device.
What is Trezor hardware security like, though? It’s not possible to brute-force a Trezor PIN. It’s similarly impossible to “reflash” the Trezor with malicious firmware, as all Trezor gadget are shipped with their secure programming chip blown. While it is possible to load custom firmware onto a Trezor, the device will display a warning sign every time it stars as well as completely wiping it.
It’s not possible for a malicious individual to open up your Trezor and alter the circuitry without your knowledge, as each gadget is sealed with ultrasound that makes opening the chassis without breakage impossible. Even if a hacker is able to open it, the Cortex M3 multilayer chip used to drive the gadget is virtually impossible to alter in a small time frame outside of an advanced lab.
The innovative security architecture of the Trezor also takes into account the possibility that a device may be set up on a computer that is infected with malware. If a malicious party accessed your computer with the intent of emptying your device hacked the randomly generated recovery seed words, they would be able to capture them — but not in the correct order.
Using this information to hack into a wallet, however, would take an inordinate amount of processing power — if the entire Bitcoin network were to attempt to crack one wallet with this method, it would take 3.5 years. A standard botnet would take several millennia.
The gadget does not possess any radio communication characteristics, making it impervious to external attacks, and when not in use is completely inert. Users are also able to create “hidden wallets” on the device that mitigates the threat of a malicious party threatening bodily harm if a user does not divulge their PIN —a hidden wallet allows users to provide threatening parties with a false PIN that provides access to a “front” wallet, but hides away the true capital stored in the device. This would be especially helpful in recent cases of theft by force such as the one recently in Phuket.
Overall, the Trezor is the safest way to store cryptocurrency available at this point in time.
Where to Buy Trezor
They are available via the Trezor website but are also available via Amazon. If you can find one, a promo code can help lower the price point of this highly cost-effective gadget.
How to Use the Trezor
Gettings started is simple, and can be achieved in just a few minutes. We’ll proceed to break down the basic steps involved in setting up your hardware wallet.
The easiest way to set up a Trezor wallet is via the Trezor Chrome browser plugin. Begin by navigating to the browser plugin page and installing it. Once you’ve installed this plugin, you’ll need to open your Chrome apps tab and click on the TREZOR Extension.
The first step in setting up your Trezor is to install the firmware, as all its devices are shipped without firmware installed. Plugging it into your computer will result in a prompt that guides you through the firmware installation process.
If your device comes with firmware installed already, don’t use it — it has been compromised.
Once your firmware installation is complete, you’ll need to plug your device in once more, and will be presented with the following prompt:
Name your Trezor device and click “Continue”. You’ll then need to fill out your recovery card. It will then provide you with a list of seed words that can be used to recover the device should it be lost or stolen. Once you’ve written these down, the setup process will require you to double-check them to make sure they are correct.
At this point, your wallet is set up and you’re ready to begin storing currency! Be sure to set up your PIN on the next page, as it creates an essential layer of protection.
Transferring Cryptocurrency to a Trezor
Trezor cryptocurrency storage and transfer are streamlined and intuitive. To transfer Bitcoin to Trezor devices, simply click the “Receive” tab for the account you’d like to transfer cryptocurrency to. The Trezor browser extension will then provide a wallet address that can be verified independently:
Enter the wallet address into the “to” field in the wallet application or platform you’re sending from, and send the transaction. It’s important to wait until the transaction has updated from “unconfirmed” to “confirmed”.
Restoring a Trezor Wallet Using Recovery Phrase
Should you lose your gadget, you’ll need a new Trezor and a computer with Trezor Bridge installed in order to recover your Trezor wallet. Connect the new device to your computer then navigate to the TREZOR wallet. You’ll be presented with the standard setup process, but instead of setting up the new device, click “TREZOR Recovery”
After entering the name of your lost device, you’ll be prompted to enter your recovery phrase:
Once you’ve entered your entire recovery phrase, you’ll be able to access the contents of your lost wallet.
The hardware wallet is currently available in both black and white and is priced at €89, or roughly $109 USD.
Overall, it may not be the prettiest hardware wallet on the market today, but it’s definitely the most secure. The device supports a massive range of tokens and benefits from simple setup and transaction processes that make it beginner-friendly.
As Trezor provides continuous updates to their firmware, it’s a strong, sustainable option, and will continue to adapt to the rapidly growing cryptocurrency market. If you’re looking for the most secure hardware wallet available today, the Trezor is the safest bet. Use this link to purchase safely from the Trezor official website.