How Do Hardware Wallets Mitigate Token Approval Risks?
Hardware wallets require physical confirmation for every transaction, including the initial token approve transaction. This forces the user to be physically present and aware of the contract address and the amount being approved.
By making the approval process explicit and physical, they prevent silent, malicious approvals that could be triggered by compromised software wallets or phishing attacks.
Glossar
Token Approval
Authorization ⎊ Token approval, within cryptocurrency and derivatives, signifies a user’s explicit permission granted to a smart contract or decentralized application (dApp) to access and manage their tokens, typically ERC-20 or similar standards.
Wallets
Custody ⎊ Wallets serve as the essential digital tool for managing the private keys that cryptographically prove ownership and control over cryptocurrencies, tokens, and tokenized financial derivatives.
Compromised Software Wallets
Vulnerability ⎊ Compromised Software Wallets are digital storage applications where the private key or seed phrase has been illicitly accessed by an unauthorized third party, typically through malware, phishing, or system exploitation.
Hardware Wallets
Custody ⎊ Hardware wallets represent a self-custodial solution for securing cryptocurrency assets, options contracts, and financial derivatives, shifting control away from centralized exchanges or custodians.