[rahen]

You use a cold wallet, that is, a secure element storing your private key. Those chips are physically isolated from the computer and cannot be tempered with.

If you lose your device (which should NEVER happen, it's a safe, not a purse), your keys are still encrypted with your PIN code and the device will self erase after 3 unsuccessful attempts.

You can retrieve your private key from a 24 word sequence (seed key), which you will usually store on a fire proof and water proof medium like a like a billfodl or stamped washers. For added security, the private key will be derived from the seed plus an additional passphrase only known to you (kind of like a salt), so your key doesn't get compromised if someone gets his hands on your seed.

Cold wallets didn't exist by the time of the incident you mention.

https://steemit.com/cryptocurrency/@angelol/cryptocurrency-h...