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Can I Recover My Hot Wallet on a Ledger?

Read 4 min
Beginner
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KEY TAKEAWAYS:
— Ledger enables you to recover any wallet with its seed phrase.

— Simply import the seed phrase on your device to recover all private keys associated with that seed phrase.

— Transferring your software (hot) wallet accounts to the security of a Ledger device requires you to send each asset over to the Ledger. Although it may seem easier, you should NEVER import a seed phrase from a software (hot) wallet onto a Ledger device.

Thinking of moving your crypto assets from a hot wallet into a shiny new Ledger? READ THIS.

Whether it’s coins or tokens, Ledger’s central premise is to keep your crypto safe by generating and storing private keys offline. Why is this so important? Because it keeps them out of reach of threats that exist online, such as hackers and malware. There’s a good chance that when you buy your Ledger device, you’ll have some existing assets on a software (hot) wallet such as Metamask or Exodus. However, moving these assets isn’t always easy. Doing this in the wrong way not only defeats the purpose of your device. It also leaves you wide open to online threats. Thus, understanding how to move assets between wallets is crucial to staying safe.

Let’s see exactly why.

How Crypto Wallets Protect You

“Owning crypto” is a deceptive phrase; really, what you own is the control of an address on the blockchain, and you own that via your private keys. Anyone who has these keys (or the related seed phrase) can access your address and anything stored there. The key takeaway? Your private keys and seed phrase MUST be kept secure if your crypto is to stay safe.

This is where crypto wallets come in. Their main purpose is to generate and secure your private keys, and keep them safe from threats.

The Problem With Hot Wallets

Different types of wallets offer different levels of protection. For example, a hot wallet may well conceal your private keys on the surface, but since it’s always online, it remains vulnerable to attacks deployed via the internet. Once your keys or seed phrase have been exposed online, even for a second, anyone might have accessed them. There is simply no way of knowing. So using a hot wallet to secure your private keys might keep them “out of sight”, but it fails to guarantee your crypto is secure from clever hackers who use your internet connection as a vector.

How a Hardware Wallet Protects You

This is why hardware wallets are a safer option. Like a hot wallet, they secure your keys and generate your related seed phrase. But unlike hot wallets, they do so in a completely offline environment. This feature keeps your hardware wallet from exposing your keys via the internet, making it immune to malware and spyware.

How to Move Your Crypto from a Hot Wallet to a Ledger Device

If you’re looking to move your assets from a hot wallet to a Ledger, here’s the key message: move, don’t merge.

What do we mean by that? As you now know, from the moment your private key is generated on an online interface, there is no way of being sure it’s safe. So recovering those same private keys in a Ledger is not an option.

Instead, you MUST start a fresh account on your Ledger device for each of your assets. Sending each one over (yes, that means some gas fees) into its new account. This is the only way to be sure both your keys and seed phrase you’re using have never been compromised. With this done, you can switch off and be absolutely certain that your assets are untouchable.

Don’t Ever Import Your Seed Phrase From a Hot Wallet into a Hardware Wallet

You might be thinking, why not just import my hot wallet’s seed phrase into my new Ledger device and save myself all the transaction fees it costs to transfer my assets? And if you are, please stop right there. Importing a software wallet’s seed phrase into a hardware wallet invalidates its security features.

The entire premise of a Ledger device is that it keeps your private keys completely offline. But the device can’t protect keys that were already exposed. Keys generated on a hacker-friendly hot wallet interface are not safe, even if they are now stored offline. You don’t know who has already seen those keys, or even the seed phrase itself. Doing this may well recover your existing blockchain assets, but it won’t secure them.

In the digital age, we all know that once something goes online, it stays there. Your seed phrase and private keys are no different.

Crypto Wallet Recovery: There’s a Time and a Place

We know what you’re thinking: when can I ever use the recovery function in that case? Well, recovering an existing wallet onto a new hardware device has important utility in certain instances. You may be using your device as a backup for an existing hardware wallet, for example. In this case, it’s safe to use your seed phrase to recover your accounts onto a new wallet. Neither the seed phrase itself (nor any of the related private keys) have ever been online. With that established, Ledger’s system can continue to secure your crypto by keeping these details offline.

Ledger’s most important contribution to your security is keeping your private keys and seed phrase offline. Ultimately, only you can make sure our system protects your crypto, by setting yourself up for success at the very start. So make sure you understand the risks, pay attention to detail, and keep learning!

Knowledge is Power.

The best way to beat the scammers? Think like one. School of Block has you covered.


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