A seed phrase is a 12 to 24-word recovery key provided to you when you open a new self-custody cryptocurrency wallet. It is important because if you lose access to your wallet, the seed phrase is the master key to regaining access.
Essentially, it is a human-readable version of your wallet’s private key created by software using a cryptographically secure random number generator (CSPRNG). The binary data is split into chunks and matched to a fixed wordlist defined by the BIP39 standard (2,048 predefined words).
- 128-bit entropy uses a 12-word seed phrase
- 256-bit entropy uses a 24-word seed phrase
You will need to make a note of your seed phrase in the exact order given to you. The same word order is needed to recover your wallet, as each word regenerates the same entropy linked to your private key.
Best practices for handling your seed phrase include:
- You should never let anyone else know what your seed phrase as it unlocks access to your wallet and all funds stored on it.
- Keep your seed phrase offline, where hackers cannot gain online access.
- Never fall for scams whereby customer support asks for your seed phrase.
The key takeaway is that you should think of your seed phrase as your wallet’s backup plan. Without it, if your device fails or you accidentally uninstall your wallet app, your funds could be lost forever. However, if you prefer not to store seed phrases yourself, you can choose a custodial wallet as an alternative, which you can learn more about via this setup your crypto casino wallet guide.
