Even the real version is the app is a software wallet right? If you have almost 500k in BTC and do not have it on a hardware wallet and use their official software for it, I have to say it's at least partially on you if you lose it.
Or perhaps not, and they have a ton of other wallets full to the brim with crypto-nonsense.
So hell yeah, it would matter, because that setup process alone makes you understand crypto better and why it's isolated from your PC. As others mentioned, that person later realized this.
When you plug a thumbdrive with keys on it into a computer the computer can just take the keys.
It's the same as the difference between a YubiKey and a thumbdrive with GPG keys on it.
A hardware wallet can make sense for "checking" purposes, but if you're only moving around small amounts of money occasionally, then you have to ask yourself whether one is worth using over a wallet app on your phone when the latter is more convenient.
> some rando thumb drive that no one knows the location of or knows exists
You still have this option with a hardware wallet. eg:
> some rando hardware wallet that no one knows the location of or knows exists
In theory.
> If you accidentally plug in the USB drive into some untrusted box, you could potentially have everything stolen.
This is like saying that no one should own a gun because you might point it straight at your own head and pull the trigger.
> You still have this option with a hardware wallet. eg:
Yes, that is true, but a hardware wallet is an extra piece of hardware that needs to be actively used to provide HD wallet keys for transactions. If all a person wants to do is store BTC for the very long term, then this approach is more complicated and hazardous than storing a non-HD wallet key pair on some physical medium; this is because a hardware wallet failure can result in loss of the ability to sign transactions, and chances are you're storing the seed phrase separately. Again, just for long term storage, there's next to no advantage between storing a seed phrase for an HD wallet and storing private and public keys. Depending on what a person intends to do with their money, a hardware wallet may provide zero value over the least complicated approach. Unless someone is paranoid over other people or the government knowing their balance, a single public address is more straight forward than managing an HD wallet.