I started to talk about the main differentiator between a software and hardware wallet in the last part. Additionally, I covered why people have lost crypto in the past. Today I want to add some more value to the topic.
If you haven’t read the previous blog posts, please check the links below:
Part 1: https://steemit.com/sct/@bitcoindelight/how-to-store-your-crypto
Part 2: https://steemit.com/sct/@bitcoindelight/how-to-store-your-crypto-part-2
Part 3: https://steemit.com/sct/@bitcoindelight/how-to-store-your-crypto-part-3
Part 4: https://steemit.com/sct/@bitcoindelight/part-4-how-to-store-your-crypto
Part 5: https://steemit.com/sct/@bitcoindelight/software-wallet-or-hardware-wallet-part-5-how-to-store-your-crypto
One of the things I have covered earlier was the fact that we want to access our own private keys. Why is that important in many ways? In 2017, the most important hard fork has happened: Bitcoin to Bitcoin Cash. To claim Bitcoin Cash straight after the hard fork it was necessary to use a software wallet that was adjusted for the Bitcoin Cash blockchain. One of those wallets is the Electron Cash wallet.
Compared to a few different software wallets it took a few days for the devs of Ledger to make the adjustments that the Ledger wallet was able to grant access to Bitcoin Cash. Why am I mentioning this here? Although the price skyrocketed later in 2017 the first few people who got their BCH instantly sold them, so the first few days the price of BCH went down. People who had their BTC on a Ledger couldn’t really participate simply as they didn’t have access to the new cryptocurrency. Another good example is the hard fork to Bitcoin Gold. History repeated itself. People who had their Bitcoin stored on Ledger had to wait again for the devs to release an update that owners were able to claim their bitcoin gold. This time the value never really recovered.
But why didn’t people owning a Ledger simply access their private keys manually? You might say that is the whole purpose of having a separate wallet. Guess what? It is NOT possible – you can’t access your private keys on a Ledger. That is something that doesn’t make sense to me as you will always have to rely on Ledger and their software to access your cryptos.
I will tell you another reason why I decided to stick with a software wallet soon.