The leading hardware wallet manufacturer Ledger is renowned for security. This reputation stems from robust research and design, resulting in products containing Secure Element Chips, the specialized BOLOS operating system, and secure screens. Ledger also employs a dedicated team of white hat hackers called The Donjon to find and repair vulnerabilities, and the company now offers a service called Ledger Recover to restore wallets even without a recovery phrase.
The world’s leading name in crypto hardware wallets is French company Ledger, which has been in operation since 2014, and a prominent reason for users to look for hardware wallets is security concerns. With that all in mind, let’s take a closer look at hardware wallet security, and specifically, at Ledger security features and the kinds of advanced wallet security that the company claims to provide.
Where relevant, we’ll focus in especially on the new Ledger Stax hardware wallet–which launched this year and sits at the top of the Ledger range–in order to assess whether its security features are as advanced as its sleek design work and smooth user experience. Although that said, it’s notable that Ledger’s security infrastructure is largely consistent across its whole range of wallets, laying the foundation for the way its products are built.
Crypto Crime
Although crypto is becoming increasingly mainstream, adoption is growing, and we now have spot crypto ETFs bringing in new investors in the US, losses due to crime remain a significant problem within the crypto space. In fact, a report from the FBI’s Internet Crime Complaint Center (IC3) states that in 2023, $5.6 billion was lost to crypto-related fraud in the US, with the number of complaints referencing crypto rising to almost 70,000.
These figures cover a range of specifics, but even besides hacks, scams and individual attackers, there is also corporate crime–as seen at FTX when it collapsed in 2022–along with the possibility that centralized platforms may simply be exposed to systemic risks. What’s more, when you’re dealing directly with crypto, you don’t have the kind of insurance protections you get with traditional asset classes, and so all of this put together means that if you really want to verify that your funds are safe, you need to look after them yourself, and for that, you need reliable hardware.
In fact, a couple of tried-and-tested bitcoin mantras are: don’t trust, verify, and not your keys, not your coins, so if you want to invest by those rules–and always be in full ownership of your assets–you’ll need to self-custody.
Ledger Technology and Security Features
Let’s run through why so many long-term investors choose to protect crypto with Ledger: what kind of features are built into Ledger products–which you can shop for here–and what exactly is the hardware technology being used?
- In all of Ledger’s wallets you’ll find similar security foundations, including the company’s own custom-made operating system BOLOS (Blockchain Open Ledger Operating System), which has been designed and built with security as its main priority.
A couple of vital features particular to BOLOS are that it keeps your secret recovery phrase and your private keys separate from the device’s apps, and it keeps all apps (for example the BTC app, the ETH app, the SOL app) separate from one another, thereby avoiding the possibility of a single failure compromising everything on the device.
- Diving in deeper, the Ledger Stax contains what’s called a Secure Element Chip (the model used is the ST33K1M5 chip) to run BOLOS and to store your private keys (meaning the alphanumeric string that secures ownership and control over your cryptocurrency). And keep in mind here that a wallet isn’t actually storing your crypto, it’s storing the keys to your crypto, so this secure storage capacity really is the critical purpose of the hardware (don’t forget: not your keys, not your coins!)
As a layperson it can be difficult to get a handle on exactly how well fortified these kinds of components actually are, but the ST33K1M5 chip has been rated according to a security framework called Common Criteria EAL, and received a score of EAL 6+ on a scale that can reach a maximum score of 7+. According to the framework operator, level 6 “is reserved for highly critical systems where security breaches could have catastrophic consequences”, while the highest grade, EAL 7, is for products “such as national defense systems”.
- The Ledger Stax’s e-ink screen makes it stand out aesthetically, but also, Ledger devices operate with secure screens. This means that while a screen on your computer may be vulnerable to security breaches, your Ledger screen is operated by BOLOS on the Secure Element Chip, which makes it impossible to tamper with, thereby ensuring that the wallet screen cannot become an attack vector.
- It sounds simple (and it is–sometimes simple is best) but to use your Ledger Stax you’ll need to create a 4 to 8 digit PIN code that’s entered every time you turn on the power, adding an additional layer of security.
What Is The Ledger Donjon?
Would you feel safe with a dedicated team of crypto security experts looking out for you? Well, Ledger goes some way towards enabling that situation through a group called the Ledger Donjon. This is a team of white hat hackers (so they’re experts on finding vulnerabilities, but they’re good guys), and part of what they do is to deliberately attack Ledger products in order to find and fix any problems, rolling out firmware updates as required.
The Donjon also audits third-party products in the Ledger Live app so that they match up to Ledger security standards. And additionally, the group issues security bulletins–in line with its policy of enhancing security through openness–and has a Bug Bounty Program that offers rewards in exchange for information about vulnerabilities.
Physical Robustness
Besides complicated tech security, let’s not forget the more straightforward importance of being resistant to physical breaks, meaning another positive about the Ledger Stax in particular is its robustness. Sure, it’s a pricey device, but for the cost you get high quality workmanship and materials, as the wallet is crafted with an aluminium body that should offer greater durability than you’d get with a plastic product.
Ledger Recover
Going live in 2023, the Ledger Recover service is provided in partnership with two other companies, Escrow Tech and Coincover, the latter of which can provide up to $50,000 compensation if assets are lost (note that claims would be subject to investigation). Ledger Recover costs $9.99 a month (with a first month’s free trial currently on offer), and provides the capacity to restore your wallet even if you lose your recovery phrase.
The service works by encrypting and duplicating your private keys, and splitting this data into three parts that are then distributed between Ledger, Escrow Tech and Coincover, and from this, keys can be restored if required.
However, not all crypto users are fans of the concept, as the service requires users to pass ID checks, and critics would point out that you’re putting your trust in third parties, and that both of these factors–proof of identity and third party reliance–go against the original Bitcoin ethos.
Still though, those criticisms aren’t an issue for everyone, and if you’re holding large amounts of crypto–enough to justify the monthly payments–then you might want to consider this option.
Ledger Safety Tips
When you shop for a Ledger, you’re getting advanced wallet security, but that doesn’t mean you can switch off completely when it comes to staying safe. There are always certain crypto practices you should stick to, so make sure to:
- Keep your secret recovery phrase locked away safely, perhaps in multiple places, and don’t keep it on your computer or your phone. This always bears repeating: if your recovery phrase is compromised, your crypto can be stolen, so keep it safe. And also, you’ll require the recovery phrase yourself if you ever need to restore your wallet, so make sure you don’t forget where you stored it.
- Use burner wallets. A single wallet–whether it’s a cold storage hardware wallet or a hot wallet on your browser–can generate multiple accounts, but a breach of one account will not lead to a breach of the entire wallet. As such, it makes sense to generate new accounts containing minimal amounts of crypto in order to transact with new Web3 protocols, so that you’re never exposing your entire crypto portfolio.
- Avoid human error. There are some things that a Ledger–despite its hardware wallet security–cannot protect you from, and these fall into the category of human error. Specifically, you should never reveal your PIN, your secret recovery phrase, or your private keys, and it’s down to you to make sure that this data is safely secured and cannot be physically stolen.
However, that last point is essentially no different from the situation when it comes to cash and regular valuables: basically, it always makes sense to be discreet and exercise common sense, no matter the type of asset in question.
Mastering Trading Course – by Lark Davis
Want to take your trading skills up a notch? Check out the Mastering Trading Course, created by Lark Davis himself. Inside, you’ll find practical, step-by-step guidance on reading market signals and using technical analysis tools. Plus, he talks about setting up your Ledger and keeping your crypto safe—perfect for anyone aiming to become a confident, skilled trader. Whether you’re new to trading or looking to sharpen your strategies, this course has everything you need to trade smarter and with real confidence.
Ps. We compared Ledger to a couple of other hardware wallets:
- Ledger Stax vs Trezor Safe 5
- Ledger Nano S Plus vs Ledger Nano X
- Ledger Nano X vs Trezor Model T
- Ledger Nano X vs Coolwallet Pro
Ps2. Our team also reviewed Ledger products:
Other interesting reads:
How to set up your Ledger wallet successfully.
How to recover your Ledger wallet – and how to avoid losing it in the first place
Ledger firmware updates – how it influences your crypto safety
Staking your crypto on Ledger – earn crypto while doing NOTHING
