The following mechanisms are used to protect your bitcoins using your Ledger Wallet :
- You generate the keys stored within the Ledger Wallet, during an initialization procedure. We never even get the chance to make a copy of your private keys.
- Your private keys never leave the smartcard. Whenever a payment needs to be made, the transaction is signed inside the secure element and the private keys are not even visible by the computer the Ledger Wallet is connected to.
- Every time you insert the Ledger Wallet in the USB port of your computer, you need to enter a PIN code. Fail to enter the proper PIN code three times, and the Ledger Wallet is reset, erasing its entire contents.
- Every time you want to sign a transaction, you need to enter a code stored on a separate offline card, providing an additional off-line security mechanism for the Ledger
- During the initialization process of the Ledger Wallet, a passphrase is generated and given to you (a sequence of 24 random words).This passphrase allows you to retreive your bitcoins should your Ledger Wallet be stolen, lost, or damaged.