What Happens to Your Crypto If the Hardware Wallet Company Goes Out of Business?

A common worry many have before getting a hardware wallet is that if the company behind your wallet shuts down, does your crypto go with it? For most wallets the answer is no, but there is one exception.

First of all, crypto lives on the blockchain and not on any device. The wallet device only holds the keys that let you move your crypto funds, and your backup is a copy of what those keys come from.

So the real question is whether you can restore that backup somewhere else if the original company disappears.

For seed-phrase wallets, you can. A seed phrase follows an open published standard, usually BIP39 or in Trezor's case also SLIP39. These standards are not owned by any single company. If the maker vanished tomorrow, you could restore your funds into another wallet that supports the same standard, from a completely different brand. This is the main argument for writing down and safely storing your recovery phrase: it works independently of any one company.

The exception is seedless wallets like Tangem, which by design have no seed phrase to write down. You cannot export a seedless Tangem into another brand's wallet. Its backup model is different that you setup multiple physical backup cards instead, and you can use any of the multiple cards to get back access.

Tangem's answer, to if they as a company were to disappear, is that the app would most likely keep working, and because the code is open on GitHub the community could in principle rebuild access. But that the community would need to re-build it would be the "worst-case" scenario according to them.

So which do you choose? The freedom to restore anywhere, or the simplicity of never handling a seed phrase at all?