How a L𝙚dger Wall𝙚t Works?
Ledger's hardware wallets are multicurrency wallets that are used to store private keys for cryptocurrencies offline. Conducting transactions using cryptocurrencies requires the use of cryptographic private keys. But these keys, which are generally stored online, are susceptible to thefts and hacks. Cryptocurrency users have developed alternative systems for storage. These include hot wallets (which are online), mobile wallets (wallets in smartphones), and paper wallets (stored on paper).
Hardware wallets are a form of offline storage. A hardware wallet is a cryptocurrency wallet that stores the user's private keys (a critical piece of information used to authorize outgoing transactions on the blockchain network) in a secure hardware device.
Ledger's hardware wallets are device-based, which means they use storage mechanisms—USB drives—to store private keys, thereby making it difficult for hackers to access the key from an online location. Ledger offers two hardware wallets: the Ledger Nano S and the Ledger Nano X wallets.
Both wallets are USB storage wallets that enable users to perform a wide variety of functions, including sending and receiving bitcoin from blockchains or running third-party apps on the device. For example, users can run universal two-factor authentication on popular sites, such as Google and Dropbox, using the wallets. All Ledger products combine a Secure Element and a proprietary operating system that is designed specifically to protect a user's cryptocurrency assets.
These wallets also use a 24-word backup recovery phrase that can be used to access a user’s cryptocurrencies if the device containing the private key is stolen. For the extra-cautious, the 24-word phrase can be etched into steel in a Billfodl, a device designed to hold your seeds and keys forever in a physical form.
Ledger Nano S vs. Ledger Nano X
In 2016, Ledger introduced the Ledger Nano S. This wallet has been called the original hardware wallet. The Ledger Nano S retails at $59.00 and can be used to buy cryptocurrencies and secure and manage assets. The Ledger Nano S integrates a certified secure chip and allows users to store between three and 20 applications.
The Ledger Nano X was introduced in 2019. It retails at $119.00. It can also be used to buy cryptocurrencies and secure and manage assets. Like the Ledger Nano S, the Nano X also integrates a certified secure chip, but it allows users to store a greater number of applications (up to 100 applications). In addition, the Ledger Nano X has a Bluetooth connection so you can manage your cryptocurrency assets from anywhere.
All Ledger wallets support 27 coins and more than 1,500 tokens. This list includes both prominent cryptocurrencies as well as lesser-known ones.