I’m just about to setup a new Nano hardware wallet. My Daedalus is already setup staking.
Question is will staking automatically be enabled to my original stakepool once I’ve paired Nano to Daedalus?
No thats not how it works.
When you are using a new hardware wallet, you are using a new pair of keys. This means its a totaly new wallet without any transactions or delegation history.
This also means that you have to transfer your funds to that new wallet and register a new delegation key.
@Zyroxa According to IOG Daedalus simply exports the Public Key to the hardware device. Otherwise moving funds to another wallet would incur transaction fees. Do you get charged transaction fees when you set up a hardware wallet?
Edit:
I just realised you said PUBLIC key.
That is correct. Daedalus can use the public key from the hardware token. The private key remains always on the hardware token.
If you already have a Daedalus wallet and you want these funds managed by your hardware wallet then you will have to transfer them to your new hardware wallet address. This will indeed incur a transaction fee.
For clarification:
A hardware wallet should generate its own key and this private key should not leave the hardware wallet. Ever. The only thing you should do with its private key is write down the seed phrase as a backup that you put into safe storage for in case you lose your hardware device.
The hardware wallet may allow you to import a seed phrase but that is not what you should do ordinarily. If you did import your seed phrase from your previous Daedalus wallet then you would effectively negate much of the security benefit of your hardware wallet. This is because this imported key (seed phrase) has been exposed on your computer that ran Daedalus and could have been copied already.
The whole idea of a hardware wallet is to protect your private key so that only it has access to your key. This is why the hardware wallet must be used to sign all transactions. The only other place for your seed phrase is the written backup that you put in your super secure triple locked underground vault.
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Am I correct in understanding that if I have a new hardware wallet that I can set it up to “restore” with my Daedalus seed phrase? I completely understand the risk of doing this. But if I do so am I right in understanding the spending password of the old Daedalus signing key prior to paring would be disabled?
I am just trying to get my grips into this because I’m trying to manage all other pass phrase including other non-cardano apps I’m hoping to use with my hardware wallet.
Yes. Daedalus encrypts the wallet key using a passphrase but the seed phrase is the unencrypted version of the key. If you import this seed phrase into any other wallet (hardware or software) then you won’t need the passphrase anymore.
If you simply want to change the passphrase, and you are sure you have the seed phrase correct, then you could simply delete the wallet and re-create it from the seed phrase using only Daedalus.
I would definitely not recommend that you import a seed phrase to your hardware wallet for the reasons stated above. You really don’t want your hardware device secret key to get exposed on any other device.
As you already said, i also dont recommand it and it would also doesnt work because Daedalus and Ledger uses a different derivation path as far as i know.
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Ok thanks. I’ll set it up as advised.
That will work with other cryptocurrencies, but not with Cardano – at least not with Ledger – since they use a different algorithm for master key derivation than the software wallets.
Same seed phrase yields different wallets on Ledger and in software.
Trezor had the same, because they did a small bug for seed phrases of 24 words or more, but I think they fixed it. So, Trezor seed phrases should now be interchangeable with software wallets, but no guarantee on that. I don’t have a Trezor to test.
Details of the different ways of deriving the master key are described in the documents linked at: https://github.com/cardano-foundation/CIPs/tree/master/CIP-0003#history
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@HeptaSean Thanks. That’s actually the answer I was looking for. Will the seed phrase generated by Ledger would be encompass the other non-cardano apps in it? In other words if I have other crypto apps and other cryptos in the hardware wallet and I loose the hardware wallet, then am I correct in understanding all the cryptos including non-cardano coins will be recoverable by the same Nano seed?
Yes, the hardware wallet is set up with exactly one seed phrase and with that seed phrase you can completely clone it on new hardware. (If you additionally use the passphrase functionality in https://support.ledger.com/hc/en-us/articles/115005214529-How-to-set-up-a-passphrase-, you need that passphrase also.)
The cryptos are not stored on the Ledger, but the Ledger just generates keys to access them on their respective blockchains. And it generates the same keys if you give the same seed phrase (and optionally additional passphrase).
All clear. Thanks.
EDIT: Final question. What if Ledger goes bust and there’s no longer support for the hardware wallets and Ledger Live has gone obsolete. I of course understand that the all the different cryptos all remain in the their respective blockchains but with this scenario will those still be recoverable by other means? You can add to that scenario that the Nano is lost as well and the only thing remaining is the seed phrase.
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With most other cryptos, as far as I know, you can just use the seed phrase in a software wallet. You lose the security of a hardware wallet in that very moment, but it should open the same wallet.
For Cardano, if Ledger goes bust, there is a huge pressure that “someone” will publish a software solution in due time. It can be done without any problem. We know what happens inside a Ledger (the CIP linked above).
Would be nice if one of the wallet apps would implement that possibility even before that. Would also be handy if you do not want (or cannot afford) a new hardware device. I have asked the Eternl team at one of the last times that topic came up, but it’s a feature request with a somewhat low priority.
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I intend to move all funds to the Nano hardware wallet. Do I need to unstake the old wallet first or can I just move the funds to Nano and leave the other wallet empty? Will I loose my 2 ADA deposit if I do that?
Yep, you will lose the 2 ADA if you do not undelegate.
And you will lose pending rewards if you undelegate immediately (which might or might not be relevant depending on the size of your funds).
If you want to still get those rewards, the process would be:
- Move everything except for ~2 ADA (for transaction fees and minimal UTxOs) to the new wallet.
- Delegate the new wallet.
- Wait until the last rewards for this main part of your funds arrive on the old wallet on 2022-09-22 21:45 UTC (third epoch boundary from now).
- Withdraw these rewards and undelegate the old wallet. (Can be done in one transaction in some/most wallet apps.)
- Send this rest (rewards, 2 ADA deposit, the remains of the ~2 ADA left in the wallet) completely to the new wallet.
- Rewards in the new wallet will start to come on the fourth epoch boundary from now (in snapshot on first boundary, producing from second to third epoch boundary, rewards paid on the fourth). So, there is no gap: Last rewards on old wallet on third epoch boundary, first rewards on new wallet on fourth epoch boundary.
(In theory, you always miss some rewards that would have come if you would not undelegate, but if you do not get hundreds of ADA in rewards, it will already be irrelevant after these two to three epochs. At some point, you will want to let the old wallet go.)
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Should I wait for the recent Catalyst rewards too? When do they come out?
Oh, yes, if you participated in Catalyst with that stake key, I would definitely wait for them also. They were remarkably high in the last round.
Unfortunately, I don’t know, when exactly they come. As far as I know, it’s still a more or less manual process (compared to the staking rewards that are baked into the protocols automatically). Last time, I remember people asking for them for quite some time after the voting results were published. Something like beginning of October?
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