Published on: January 11, 2025
In this new interview by Safety Detectives, Uxio Fraga, CEO of Material Bitcoin, shares his insights into the importance of cold wallets for cryptocurrency security, and his practical tips to protect your cold wallets.
Can you explain the main advantages of storing crypto in a cold wallet, like Material Bitcoin, over other types of crypto storage? Is this the right choice for everyone?
Cold wallets, like Material Bitcoin, have one key advantage: they are completely offline. This means they are immune to online hacking attempts, malware, and phishing schemes that frequently target hot wallets and exchanges.
As a matter of fact, over $1.7 billion was stolen just in 2023 from cryptocurrency exchanges. Two notable cases:
- Japanese cryptocurrency exchange DMM Bitcoin lost 4,500 BTC (about $305 million) in May 2024. How hackers were able to pull this off is still unknown.
- In September 2024, WazirX suffered a smart contract hack that resulted in a loss of approximately $230 million, prompting a class action lawsuit against the Indian cryptocurrency exchange.
This data highlights once again the importance of prevention. Hence, for those who prioritize long-term savings and want maximum security against digital attacks, a cold wallet like those we offer is essential. Like parents or families, for example, who see bitcoin as a way to build a better future for their children. They’re not necessarily tech experts, but they understand the value of long-term savings in a secure and reliable format.
They choose Material Bitcoin wallets because they want a tangible, offline way to protect their investment—something they can physically hand down to their kids without worrying about hackers or digital complexities. For these customers, our wallet is more than just a tool; it’s a legacy for the next generation.
However, cold wallets are not be the best choice for everyone. If you trade frequently or need instant access to funds for payments, a mix of cold storage for the bulk of their holdings and a hot wallet for active trading (or just some funds on their smartphone) might work best for you.
Your cold wallets have never been hacked. What features helped you achieve 100% security that other cold wallets don’t have?
Material Bitcoin wallets are unique because they are fully analog—no electronic components, no firmware, and no software that can be exploited. The keys or mnemonic phrases are etched permanently onto high-grade stainless steel, which also makes them resistant to physical threats like fire, water, or crushing.
Additionally, by pre-engraving keys or seeds onto the wallet, we eliminate the need for users to generate or input them digitally, which is often where vulnerabilities arise. This design choice ensures a seamless and hack-proof user experience for those unfamiliar with complex crypto setups.
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That said, can cold wallets ever be completely Hack-proof? What else should crypto owners do to maximize the security of their funds after storing them in one of your cold wallets?
While Material Bitcoin wallets per se are 100% hack-proof, there are external factors to consider, like physical theft or social engineering attacks. To maximize security:
- Store your wallet in a safe, secure location.
- Avoid sharing or photographing your wallet’s keys or seed phrases.
- Just don’t tell anyone you own a Material Bitcoin wallet!
- Access your cold wallet or seed phrase only when you have full privacy. Avoid public places or environments with cameras or bystanders.
- Consider home security systems with alarms and cameras that alert you if someone enters without permission.
- Understand the tactics used in social engineering attacks to make you reveal critical information. Be especially cautious of urgent requests, or suspicious “technical support.”
How does Material Bitcoin ensure privacy for their users, and what else can people do to avoid their bitcoin transactions being tracked?
We ensure privacy by making it impossible for any private keys to leak, simply because we never store them.
The private key engraving process is fully automated and conducted in an isolated, offline environment. No human has access to the private keys at any point, and the system used to generate and engrave them is immediately wiped after the engraving process.
The only place your private key exists is on the physical wallet that you receive.
Additionally, the engraved key is covered with a protective metal sticker and sealed in a hermetic aluminum pouch, ensuring that it remains private until the rightful owner decides to access it. By designing our wallets in this way, we eliminate any risk of private key exposure, offering unparalleled security and privacy for our users.
Bitcoin frauds are also rampant. How can people effectively spot a Bitcoin scammer, and what can they do if they fall victim?
Bitcoin scammers are easy to spot when they ask for money “to release some funds” that supposedly belong to you. A common tactic is claiming you have Bitcoin or other assets in an account you never opened, but you need to pay a fee to unlock them.
This is a red flag because legitimate funds don’t require upfront payments to access.
Looking ahead, what’s your take on the potential threat posed by quantum computing to cryptocurrency security? Is our ability to secure crypto progressing fast enough, and what can be done in this regard?
Quantum computing is a theoretical threat to current cryptographic standards, including Bitcoin’s elliptic curve cryptography. However, we are still many years away from quantum computers having the power to break these systems. The community has already proposed quantum-resistant cryptographic methods that can be implemented via soft forks.
How can our readers connect with you?
Website: https://materialbitcoin.com/en/product/material-bitcoin-standard/
LinkedIn: https://www.linkedin.com/company/79463759/admin/dashboard/
Instagram: https://www.instagram.com/materialbitcoin_english/
Telegram: @materialbitcoinoficia
Data sources:
https://public.tableau.com/app/profile/federal.trade.commission/viz/TheBigViewAllSentinelReports/TopReports