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Am running through my mind the pros and cons of storing Ada on a spare computer disconnected from the network, not happy with being connected to the Internet 24/7 despite being behind firewall.

Apart from the inconvenience (due to physical size) of storing on a spare wiped and reinstalled computer, what are the security implications versus something like the Ledger cold wallet? Seems to be a few grey areas in that regard.

The computer would be disconnected from the network when not doing transactions but obviously does not have the physical as well as logical separation which something like the Ledger provides. On the other hand, Yoroi sandboxing provides a good level of security, and that coupled with a clean install, a dedicated computer would possibly suffice. Would there be advantages in installing Daedalus in this situation?

Any thoughts on this much appreciated.

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The question is, is it worth the trouble instead of spending $70 for a warranted and battle tested hardware wallet?

My answer to your post is that is probably not, if you are not doing anything specific that a hardware wallet can't do (like minting NFTs).

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I've done something similar on a Virtual Machine. I have a Linux based operating system for additional security.

Doing as you propose is basically the same as using a Ledger/Trezor. The additional risk with your setup is that you have your wallet on a computer that can run additional code that a hardware wallet can not. Every time you connect it to the internet and run code on it, you are presenting a security risk.

One possible risk I face from running Linux is that when I update my OS I download an app that's been compromised and can somehow run code to steal my funds.

Over using Yoroi and Daedalus, Daedalus is considered the safer option. But in a practical sense, they're as safe as each other and it's only in theory or extreme situations that Daedalus is safer.

The risks between these setups I believe is rather minimal. One advantage of having a big clunky PC is that you can't lose it easily, so at least you always know where it is as a convenience.

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I built a fully offline Raspberry Pi solution on another coin years ago using QR codes, and cameras as readers.

Cardano is similar in the fact that you 1. build a transaction, 2. sign a transaction and then 3. broadcast a transaction. Only the signing part needs access to your keys.

As an early step just transferring the data from step 1 to the computer, and then back after step 2 on a small USB stick would allow you to keep your computer fully offline, you would need to learn to construct raw-transactions in a cardano-node CLI.

If this is really of interest look at the Zymbit HSM6 which is a way to encrypt a Raspberry Pi and it has access to common cryptocurrency key schemes, though I didnt check for compatibility with Cardano.

EDIT: Found my old code, it was never meant for production use, just a fun project, but it gives you a start: https://github.com/Scalextrix/coinofflinewallet

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This is similar to what I do with an airgap system, the main difference is the airgap system I use is never connected to the network and only signs transactions. I have a live USB stick that only uses Internet when iso is built, can import a wallet mnemonic via https://github.com/input-output-hk/adawallet, and I build transactions on-line using rosetta to query utxos, then sign on the offline system sneaker netting a usb stick back and forth.

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