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How To Stay Secure as You HODL

Read 4 min
Black closed belt on a orange background.
— An offline key is the only key – this is never more important than when you’re HODLing.

— HODL is a term originating from a 2013 Bitcoin Talks forum post – it’s shorthand for not selling your crypto, even if the market is crashing.

-— But HODLing comes with some important security implications: with your crypto sitting dormant for an extended period, knowing it’s safe and immune to threats is absolutely essential.

— Here, more than ever, your private keys need to be offline under your control, nobody else’s.

— Here, we talk best practices for secure HODLing.

Your choice of wallet is more important than ever when you’re HODLing – as you hunker down, your crypto depends entirely on the security infrastructure you’re using for your private keys. Let’s talk about HODLing, and how to stay secure as you do it.

First a Recap: How HODL started

It all started on a December morning back in 2013. The Bitcoin market was crashing by almost 40%, reaching a “low point” of $447. Many early adopters started to panic sell their BTC. But one Bitcoiner refused…

Bitcoin Talk member GameKyuubi wasn’t having any of that, making a clear statement with his forum post “I AM HODLING” that he did not plan to sell and succumb to the market’s downtrend. He didn’t want to become part of the day trader group, and instead preferred to stay there as a “part of the market capital”. Instead, he would HODL.

GameKyuubi stated being aware of the typo in the title, but to have gone with it anyway – and the community caught on. They simply loved the term HODL, and sure enough it has become a deeply appreciated part of crypto vocabulary since.

What HODLing crypto means

HODL, commonly seen as an abbreviation for Hold On for Dear Life, refers to keeping your Bitcoin or other cryptocurrencies rather than selling them whenever the market crashes. It’s the exact opposite of what day traders would do, who try to time the market and maximize their profits through it. Hodling is also seen as a measure against panic selling – the act of trying to jump out of the market in panic whenever a crash occurs.

HODL is quite simply holding onto your crypto and blockchain assets for an extended period of time – regardless of any market swings. It’s become a way of life for many in the crypto community, who see mass adoption as a long game and are in it for the duration: they buy their crypto, secure it and wait patiently.

There are also those who HODL crypto for their strong belief in cryptocurrency fundamentals, seeing it as the eventual replacement of fiat currency.

So with all this in mind, how can hodlers ensure they remain secure as they hunker down and play the long game?

How to HODL Securely

When you HODL your crypto, you’ll be keeping it for quite a long time, which means it’s vital to store it securely. Doing this means looking at two key questions:

  1. Do you control your private keys?
  2. Are those keys secure?

Let’s look at each one in turn, so you can identify your vulnerabilities – and get yourself secure!

1) Do You Control Your Private Keys?

Many people choose to secure their crypto using the custodial wallet of a big platform – an exchange, for example. This might seem easy and convenient – after all, you simply need to log in to the platform and immediately you can begin trading. Plus, you don’t need to worry about protecting private keys and seed phrases. Sounds great, right?

But there’s a big drawback: not your keys, not your coins.

You’ve heard it before – but we’ll say it again anyway, because it is THAT important. Any time you don’t control the private key for your crypto – for example, when you access it using login details instead of private keys – that crypto is not yours. It means you’re relying on someone else giving you access to it, and keeping it safe.

What does that mean for you?

Imagine having some coins and tokens in an exchange wallet, only to find out that someone managed to hack the platform – or worse, that the exchange no longer exists. In either case, you won’t get your crypto back. With that in mind, it’s more or less impossible to guarantee the security of your coins and tokens when you’re using an exchange wallet. This is why having control of your private keys is so critical, both for your security and for your peace of mind.

2) Are Your Private Keys Secure?

OK, so we know that having the private keys for the blockchain address of your crypto assets is the only way to truly own them – but even that doesn’t mean they’re completely secure.

Digital opportunists know the power of your private keys and seed phrase, and have clever ways of seeing this information without your knowledge. This normally takes the form of hacks and malware deployed to your computer or phone via a link, which can then hack into your wallet applications or spy on your saved data.

The result?

If you’re using an online wallet to secure your private keys autonomously, your private keys are still not secure – and neither is your crypto. In fact, any time when your private keys or seed phrase are on a connected device, your coins and tokens are vulnerable. This makes this type of wallet far from ideal for anyone looking to HODL, especially long-term.

You might be wondering at this point how you can ever have peace of mind as you wait out the bear market, with so many different threat vectors impacting your crypto security. That’s where Ledger comes in.

Ledger Hardware Wallets – the Only Safe Option for HODLing

At Ledger, we have one mantra: an offline key is the only key.

Knowing that self-custody of your crypto is the only way to stay in control, we create hardware wallets designed to give crypto holders complete security as they manage their private keys. Our devices keep the private keys (that give access to your precious cryptocurrencies) offline, using highly advanced chips, that are out of reach of online attacks at all times.

These chips are very resistant to physical threats as well. Even if anything were to ever happen to your Ledger device, you’d have a set of 24 words known as the Recovery Phrase to give you access again to your precious crypto assets. Oh – and even that recovery phrase never appears online, meaning your keys are watertight.

HODL in Peace, Fren

Waiting out the market should not mean a nail-biting experience hoping your funds are safe. The whole point of self-custody is financial freedom and control – and with Ledger, you can enjoy complete control over your assets, and complete peace of mind to go with it.

Knowledge is Power.

Self-custody means YOU are in charge – but it also means that YOU are responsible. Here, we explain exactly how to protect your coins and tokens, so you can focus on exploring what crypto has to offer. Thanks, School of Block.

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