A hardware wallet helps protect your cryptocurrency by keeping the private keys used to spend it separate from your computer or phone. Its own screen lets you check transaction details before approving them. These protections work together: keeping keys out of reach of malware does not prevent a loss if you approve the wrong transaction or disclose your wallet backup.
A secure design also needs safeguards for how the wallet is created, how its secrets are stored, and which software the device can run. This article explains those principles and how BitBox02 and BitBox02 Nova put them into practice.
How a hardware wallet protects your private keys
Your cryptocurrency is recorded on the blockchain. The wallet holds private keys: secret data that lets you authorize spending. Someone who obtains those keys can spend the associated funds without your hardware wallet.
When you send a transaction, the wallet application prepares its details and passes them to the hardware wallet. After you check and approve the transaction on the device, it uses the private keys internally to create a digital signature. The application can then send the signed transaction to the network without receiving the keys themselves.
This separation reduces exposure to malware on a general-purpose computer or phone. The hardware wallet has a much narrower job, but the connected application can still present misleading information or request an unwanted transaction.
Why you verify transactions on the device
The hardware wallet's screen gives you a place to check what you are authorizing independently of the computer or phone. For example, malware could replace a copied recipient address with an attacker's address. If you approve that address on the device, the hardware wallet can sign the transaction correctly even though the payment goes to the wrong person.
Before sending, compare the full destination address and amount shown on the BitBox screen with the payment you intend to make, using recipient details from a trusted source. If they do not match, do not approve. When receiving, verify your receiving address on the BitBox screen before giving it to the sender.
The device screen is the reference for these transaction checks, but it does not override security warnings from the BitBoxApp. Stop if the app reports that your device is not authentic or reports an anti-klepto protocol failure—a failure of a check intended to prevent certain signatures from leaking private-key information. Do not continue simply because the device screen appears normal.
How BitBox protects the wallet and its firmware
Transaction verification is one part of the design. BitBox also combines protections for wallet creation, secret storage, and the software running on the device.
Creating a wallet that is difficult to guess
A newly generated wallet starts with secret random data called a seed, from which its private keys are derived. Predictable starting data could let an attacker recreate the keys. BitBox combines randomness from several sources, including both chips and the connected computer, to reduce reliance on any single source.
For a closer look at the randomness sources and how they work together, read what entropy is and how BitBox generates your wallet.
Protecting the seed with two chips and your password
BitBox02 and BitBox02 Nova use a microcontroller, which runs the wallet firmware, and a separate secure chip. The wallet seed is stored encrypted on the microcontroller. Unlocking it depends on your device password and secrets held by both chips, so reading the microcontroller's storage alone is insufficient. The secure chip also limits and slows password guessing.
Our article on combining a secure chip with open-source firmware explains how this architecture protects the seed while keeping the wallet firmware open to inspection.
Checking firmware and device authenticity
Firmware is the software running on the hardware wallet. The BitBox bootloader checks that firmware is signed by BitBox before allowing it to run. Separately, the BitBoxApp checks the connected device's authenticity. These checks address different risks: unauthorized firmware and devices that cannot prove their authenticity.
Neither check guarantees protection against every vulnerability or physical modification. For how these checks work alongside physical safeguards, read how BitBox reduces supply-chain risk from production to first use.
Why independent verification matters
Security also depends on making the implementation available for scrutiny. BitBox publishes its firmware and BitBoxApp source code so researchers can inspect how they work. Its firmware builds are reproducible: someone can build a release from the published source and compare the result with the distributed firmware.
Open source enables inspection, while reproducibility helps establish the connection between source code and a released program. Neither proves that the code is free of vulnerabilities. Security reviews and BitBox's bug bounty program help identify weaknesses. For the design's assumptions and limitations, see the BitBox threat model.
What you still need to protect
Your wallet backup provides another route to the same wallet. A complete microSD backup or recovery words can restore it without the original device or its password; if you use an optional passphrase, that exact passphrase is also required. Keep backups private and offline, and never share recovery words or enter them into a website, computer, phone, support chat, or AI tool. BitBox Support will never ask for your wallet secrets. See BitBox backup options and their protection requirements.
Use the official BitBoxApp or trustworthy compatible wallet software, keep the app and firmware up to date, and keep your device password private. For attack scenarios and practical safety guidance, continue with Can a hardware wallet be hacked?