Square wants to sell a Bitcoin wallet, but should they?

Strengthening its commitment to the Bitcoin ecosystem after investing billions, Square is now aiming to disrupt the market with a hardware crypto wallet.

Square, the financial services company led by Twitter CEO Jack Dorsey, has announced that it will create a hardware wallet to store Bitcoin and facilitate cryptographic transactions. However, this is not the first time Square has dived into the world of Bitcoin. In October of last year, Square invested $ 50 million in Bitcoin, followed by a $ 170 million purchase earlier this year.

In fact, Square was one of the first recognizable names to invest heavily in Bitcoin and inspired a wave of adoption in the corporate sector, catalyzing a move away from personal property. Even though the last few weeks have not been kind to Bitcoin’s valuation, the company, which now owns Tidal, says it remains committed to its cryptocurrency strategy.

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The latest example of Square’s loyalty to the cause of cryptocurrencies is its ad about making a hardware wallet. Dorsey first teased last month, the hardware wallet will be a first Bitcoin device that will support multiple signatures and prioritize use with mobile devices. To remember, Square already offers a payments app that allows users to buy and sell Bitcoin.

Can Square add something extra?

Bitcoin hardware wallet made by Square

Square’s hardware leader Jesse Dorogusker revealed that the company is also building a service for its Bitcoin hardware wallet. Moving forward, Square will assemble a team that will oversee the design, manufacturing, technology, and supply chain side to bring its hardware Bitcoin wallet to market. Although the device is still a long way from becoming a reality, it already has a few things going for it, the most important of which is brand recognition and a recognized leader.

A hardware bitcoin wallet can be defined as a physical plug-in device that stores the private keys used to authorize Bitcoin transactions. A hardware wallet essentially acts as cold storage for crypto assets and its main purpose is to keep those assets away from an internet-connected device, such as a PC or smartphone, that can be hacked or attacked by ransomware. In addition, they add another layer of security in the form of a PIN that must be authenticated when the hardware wallet is connected to a PC to conduct business. Hardware wallets often come with very basic software that makes them less prone to sophisticated malware attacks. However, to be successful, Square will have to offer something more attractive in terms of security or pricing to ensure that its hardware Bitcoin wallet can outwit the likes of Trezor and Ledger.

Hardware wallets aren’t a silver bullet to all cryptocurrency problems, and that’s one area where Square has to differentiate its next product from the rest. Despite using a hardware wallet, users can still be tricked into sending Bitcoin to the wrong address, if the PC they have connected to has been attacked by malware. In addition, there are back doors at the hardware and software level and tampering with the device while shipping it to the buyer can also happen. In the worst case, a malicious party can intentionally steal or damage a hardware wallet to block someone’s access to its crypto assets, even if it’s only a temporary problem.

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Fountain: Jesse Dorogusker / Twitter

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