When participating in DeFi, users often need to carry out frequent on-chain transactions. These on-chain activities come with several risks, such as computers being hacked or remotely controlled, hot wallets being directly compromised, and targeted phishing attempts through email, instant messaging, or even social engineering by people you know. For example, someone may send you a malicious link, and clicking it could infect your computer with malware. If your device has already been compromised and you rely only on hot wallets like MetaMask for DeFi activities, hackers may be able to transfer funds out of your wallet immediately.
The purpose of a hardware wallet is to keep the private key isolated from the internet by separating it from the public-facing environment. Every time you make an on-chain transaction, you must confirm it by physically pressing a button on the hardware wallet, which authorizes the private key to sign the transaction. In this way, the private key remains offline and protected. By contrast, mobile wallets and browser extension wallets usually combine public and private key functions in the same internet-connected environment, which makes them more vulnerable to hacking and theft.
No matter how advanced a hacker may be, they cannot physically press the confirmation button on your hardware wallet from a remote computer. For this reason, larger amounts of funds benefit greatly from the protection provided by a hardware wallet. Using the UKey hardware wallet for DeFi can significantly improve the security of your assets.
Compared with software wallets, most hardware wallets generally offer the following features:
● Secure chips for generating and storing private keys
● Physical buttons and screens for displaying transaction details
● All transactions are signed through the hardware wallet, without exposing the private key
Point One
A hardware wallet is only a tool for protecting your private key or recovery phrase; the private key or recovery phrase is the wallet itself. Anyone who has access to your private key or recovery phrase can control and transfer your assets. This means that a private key or recovery phrase is not like a traditional password. Neither UKey nor any other wallet provider can recover it for you. You must make multiple backups of your private key or recovery phrase and store them securely.
Point Two
Your private key or recovery phrase must never be exposed to the internet. Exposure includes, but is not limited to, copying and pasting it, storing it in Word or Notepad on a computer, taking photos of it, or uploading it to WeChat, cloud storage platforms, or note-taking services. The safest method is to write it down by hand on paper, make multiple copies, and keep them in secure locations or entrust them to a reliable person for safekeeping.
Point Three
Since the private key or recovery phrase is the wallet itself, if a hardware wallet is damaged, you can restore access by importing the recovery phrase into another hardware wallet or compatible secure wallet. However, you should not import a hardware wallet’s recovery phrase into hot wallets such as MetaMask or Rabby. In addition, if you ever need to reset the wallet, you must first make sure that it contains no funds or that the recovery phrase has already been safely backed up and can be used to restore the wallet later.