So you have invested in your hardware wallet and have written down your recovery phrase. But what happens if both your device and the piece of paper your recovery phrase is written on are destroyed in a disaster such as a flood or fire? Unless you have committed your unique recovery phrase to memory you won’t be able get your holdings back. This is why cryptocurrency steel wallets have been designed to take into account such eventualities.
What are the advantages and disadvantages?
Pros
More Resilient than Paper
The obvious advantage of cryptocurrency steel wallets is that being made of metal, they are more durable than paper, and are resistant to fire, water, and shock damage. They are also have the benefit of being hack-proof (not being a digital device) and are unreliant on a third party in keeping your recovery seed secure. This gives the crypto investor assurance that if disaster were to unfortunately strike, whether it be digital or from the elements, the recovery phrase would be safely recorded.
They come in several forms – and some forms are reusable
There are several examples of these steel wallets on the market. Some types of steel wallets utilise small steel tiles with engraved letters, which you can use to assemble your seed phrase manually by slotting them in one by one (albeit abbreviated as there is only space for four characters per word). They’re easy to reuse as one can simply take the letters out and replace them for a new seed phrase. They can also come as a metal plate that can be etched with your seed phrase using an engraving tool. Whatever form you may decide to choose is down to individual preference.
Cons
Additional Cost
The blatant downside is that they present an additional cost to an outlay on a hardware wallet. This could be negligable though if an investor has stored substantial funds on their cold storage devices. Although obviously it doesn’t make sense to buy one of these if you only have a small amount of crypto investments. They vary in cost, but at the time of writing we have seen prices ranging anywhere from around £40 to £130 (or $50 to $170 US). If you have your heart set on buying one, it would be prudent to shop around and consider if it is worth it relative to the size of your investment.
Extra Room For Storage?
Some forms, particularly steel wallets that use the small tiles, take up much more space than a paper wallet. This factor will depend on every person individually, however it can’t be argued that a fair amount of paraphernalia comes with steel wallets. Whether it be unused metal tiles, metal plates, engraving pen etc these add up to consume storage space. This is only exacerbated further if you intend to buy more than one, so please keep this in mind.
So do we think they are they worth it?
In short, it depends. If you have a lot of money invested in cryptocurrency that you have stored on a cold storage device, like a Ledger Nano or a Trezor, then yes it could absolutely pay to have a steel wallet. It provides you with a robust recording of your recovery phrase resitant to the elements. This also in turn affords you extra peace of mind. For those who have very small investments however, it may not be worth the costs until your portfolio grows.