The team at NFTexplained.info will explain the importance of a seed phrase (also known as a recovery phrase) including the team’s personal opinion on the best option to store this information.
When storing your seed phrase, ensure that every letter is written down correctly as this is more important than the hardware wallet itself; it is the only way to recover your assets. An important aspect of your seed phrase to note is that it should never be stored on the Internet or uploaded to the cloud.
The best way to think of your seed phase is as a master key which gives you access to all your digital assets – including your private keys!
If you are curious as to why it’s important to have a hardware wallet and the problems that are solved by this piece of hardware, click here.
You will want to record the collection of words – the seed phrase – using an offline storage tool, the lowest cost option is a piece of paper. It should also be noted that ink can fade and dry away so it may be optimal to use a pencil instead, however this still leaves your seed phrase susceptible to unfortunate incidents that may involve water or fire. Floods and fire can destroy the marvelously inexpensive sheet of paper…
A far better, although costly, option than writing on a piece of paper would be a Cryptotag Zeus which is a titanium, indestructible way to keep your seed phrase safe. As we previously mentioned, a titanium piece is the best option as it is waterproof, indestructible, bulletproof, and fireproof. You can find the option our team likes the best here.
Always write/punch this phrase when you are in an environment where you are by yourself and can do this with your full attention (without making any spelling errors).
One should never have any digital receipt of their seed phrase, EVER. The whole purpose of having a hardware wallet is to ensure that these words are not on the Internet so they can’t be hacked or intercepted by malicious actors.
Computers can be hacked. Emails can be intercepted or hacked. Encryptions can be hacked. High level encryption can still be hacked. The evolving technology of quantum computing is another risk as, in theory, it could be used successfully in a brute force attack (a trial and error hacking method).
Now our team will cover some common questions you may have.
What Is The Best Way To Store My Seed Phrase?
The best way to store a seed phrase is on a metal sheet (e.g. titanium) in a safe location. It is incredibly important to keep this information off the cloud so you are not susceptible to being hacked and losing your valuable digital assets.
There are many good options but our team in particular likes the Cryptotag Zeus which is a product from Trezor. This allows you to secure up to 24 words in BIP39 which is an alphabetical list which is used to configure your seed phrase.
Instead of punching in letters, numbers are used as they are easier to store and the whole process can easily be completed in less than a few minutes.
If you were to lose the BIP39 wordlist, that would not be a problem, as it can be found on the Internet. As our team previously mentioned, the numbers are used as they are easier to store and shorter when punching into a titanium plate.
Does Ledger/Trezor Store Your Seed Phrase?
When you have created your seed phrase, you are the only one in possession of it and Ledger/Trezor will not be able to help you get your assets back if the phrase is lost. This is a risk that comes with decentralization but it’s important to keep your seed phrase offline so you are not susceptible to being hacked.
Your seed phrase can be thought of as the master key and losing it can mean losing all your assets. If your hardware device is lost, it’s still possible to recover your assets only if you have your seed phrase.
Do You Need Both Your Seed Phrase And Private Key?
Your seed phrase and private key are two separate entities. Your seed phrase is what gives you access to your wallet which holds all your private keys. Your public wallet address does not need to be hidden as it doesn’t allow anyone to hack your account.
Our team should note that a public wallet address is a 42 character address (e.g. 0xfc…) that allows you to receive funds from another party.
In order to access the assets within an address the private key is needed and that is why it is so important to keep it safe.
What Happens If I Lose My Seed Phrase?
If you don’t remember your password and lose your seed phrase, you have lost
access to your digital assets. The importance of writing your seed phrase down (preferably on titanium) and keeping it in a safe place can not be understated. Your seed phrase can be thought of as the master password to your account.
If you have forgotten your seed phrase and are logged in or able to log in to your account, it is a good idea to move your assets to another location – one where you know these valuable words.
Your seed phrase can be thought of as a backup for your assets which will ensure that you can recover access to your digital assets.
Decentralization comes with the risk of you being the only one in charge of your assets. With web2, it’s possible to contact a centralized company when you forgot your password (i.e. contact Instagram if you have forgotten your Instagram password; however this is not true with web3).
The NFT space is always changing and the technology is quite new. Our team is incredibly excited to see what will happen as time goes on. To get the latest news in this rapidly evolving space, follow our team on Instagram & Twitter!
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