A hardware wallet is a device designed to store a user’s private keys securely, without ever exposing them to other external devices or the internet. For this reason, most hardware wallets are cold wallets and are amongst the most secure methods for storing and using Dogecoin and other cryptos.
Usually, hardware wallets can be connected to a PC or another device via a USB or Bluetooth connection. Through this connection, they can be used to sign a transaction occurring in a wallet application running on the external device (such as your PC). The transaction is signed inside the hardware wallet, and, unless the hardware wallet has been previously compromised, the private keys are never exposed to the outside world throughout this process.
In theory, this makes a hardware wallet safe to use also on a compromised computer. There are several manufacturers of hardware wallets. Each manufacturer includes different features in their hardware and associated software to prevent common pitfalls crypto holders tend to fall into when storing their crypto. These features might include security PINs, self-destruction mechanisms, and automatic generation of seed phrases.
Nowadays, most hardware wallets rely on the use of a seed phrase, also called mnemonic phrase or mnemonic seed. A seed phrase is usually a 24-word phrase that acts as a sort of master key which the hardware wallet uses to calculate all the private keys needed to access and spend the crypto you are holding. Upon first use of a hardware wallet, a new seed phrase is generated or an old one can be input.
The seed phrase is the key to all the cryptocurrencies you are holding on a hardware wallet. For this reason, it is also known as recovery phrase, and you must store it safely, in multiple copies, in several safe locations. A copy of the seed phrase is all you need to have a full backup of your hardware wallet. Even if your hardware wallet is lost, you can just restore access to all your crypto by simply inserting the seed phrase you have backed up in a new wallet.
Using a hardware wallet with Dogecoin is very easy to do, and all hardware wallet manufacturers provide instructions on how to transact with their devices. Oftentimes it is simply a matter of inserting the device into your computer, entering the PIN and/or an optional passphrase, and then initiating and confirming the transaction that you’d like to make. An added benefit of hardware wallets is that they can facilitate a way of transacting with your Doge aimed at protecting your privacy.