There are different ways to buy Bitcoin, depending on your preferences and needs. For example, you can buy Bitcoin with bank transfer and enjoy high spending limits and no processing fees. Leading regulated cryptocurrency exchanges offer this option. You’ve bought some cryptocurrency, but how do you keep it secure?
You can store Bitcoin in different types of wallets (mobile, desktop, web, and hardware), which can be Internet-connected or not. Regardless of what type of wallet you use, to access your coins, you’ll need a set of private keys. As you begin using your wallet, it will generate a vital piece of data you must protect – your seed phrase.
The seed phrase is a sequence of 12 or 24 random words your Bitcoin wallet generates. It allows access to your coins, irrespective of what happens to the wallet itself. In the event of file corruption or hardware breakdown, you can reinstall the Bitcoin wallet and access your cryptocurrency.
Hot and cold wallets alike use a seed phrase for recovery. When the Bitcoin wallet generates your seed phrase, it will most probably require you to write it down and store it in a safe place. Pen and paper can’t be hacked, so they can keep your seed phrase safe for years to come. Still, it’s not the most foolproof way to keep your seed phrase secure. So, which method is better?
Write The Seed Phrase Down Using Invisible Ink
You shouldn’t even take into account the possibility of storing your seed phrase on an Internet-connected device. Security breaches and hacked accounts are common, meaning you have no control whatsoever over your data. It’s best to go for an offline storage method. For example, you can write down the seed phrase using standard paper. To eliminate the risk of anyone else reading it, use invisible ink to keep prying eyes away. The ink is invisible upon application and thereafter, but it can be made visible using ultraviolet light or heat. If you’re sure your pen won’t go on walkabouts, it can be useful for writing passwords as well.
Unlocking Market Efficiency: Choosing the Best Liquidity Provider for Your Crypto JourneyThe paper with the seed phrase written on it serves as a backup, allowing you to restore your Bitcoin wallet if it’s rendered inaccessible or lost. You can make several copies of your seed phrase and store them in different locations. If something were to happen, like a fire or a flood, you still have access to your coins. Invisible ink makes it look like the paper is blank until the seed phrase is revealed. It may sound like something only a secret agent would do, but invisible ink is very easy to get hold of. People often note their seed phrases in documents or write them down together with other notes. If you prefer to keep your seed phrase on paper, know where to find it when you need it.
Split Each Word of The Seed Phrase
Split your seed phrase into two or more sections and store them in separate locations. As mentioned previously, the seed phrase is made up of 12 or 24 words randomly chosen, so it’s impossible for anyone to guess. However, if hackers manage to take over your smartphone or computer, they’ll gain access to your seed phrase, and you can say goodbye to your coins. It’s a risk you can’t afford to take. The best thing you can do is to split up each word of the seed phrase and store them separately to increase security. You can store the sections physically or virtually, but it’s a good idea to keep physical copies.
Splitting the seed phrase into two or three sections is enough to restore your Bitcoin account. Numerous experts recommend adding a passphrase to the seed phrase, but this approach has some shortcomings. More exactly, the passphrase must be strong enough to avoid brute-force attacks. Equally, if you lose both the seed phrase and the passphrase, there’s no way to recover your Bitcoin wallet. Even if the passphrase adds an extra authentication step, you must keep track of it as well. It’s better to be safe than sorry if your information is stolen.
Encrypt The Seed Phrase Using a Cypher
Encryption transforms the words used for account recovery into unreadable ciphers, meaning it’s difficult, if not impossible, for someone to access your Bitcoin wallet. It creates a reasonable amount of security around your seed phrase. Write the seed phrase into a file and encrypt it using specialized software. As long as the hacker doesn’t have the encryption key, your seed phrase and your coins will remain secure. A digital vault offers a high level of protection. The seed phrase will be turned into encrypted shards and distributed to a network of guardians. The guardians can be multiple devices under your control or people you trust.
Store Your Seed Paper in A Metal Crypto Wallet
Finally, yet importantly, you can store your seed phrase in a metal crypto wallet. This backup is made of something more durable. With the see phrase, your wallet’s private keys can be recreated despite the fact that the data on the physical copy is destroyed. As the name clearly suggests, a metal crypto wallet is a physical device, typically made of stainless steel, that you can carry around in your pocket. It’s fire, water, insect, and mold-proof, so it goes without saying the enclosure ensures durability. Your Bitcoin is only as secure as your seed phrase, so keep it safe.
The Basics of Bitcoin and CryptocurrencyWhen it comes to safely storing your seed phrase, metal wallets are regarded as the golden standard for secure storage and accessibility. There are various solutions out there, each promising to keep your seed phrase protected against emerging threats, so do your homework. You can’t entrust your financial security to the integrity of a paper wallet. The seed phrase is inscribed onto a more robust medium – it’s the mother of all backups. If you have the budget for it, the metal wallet is one of the most versatile and secure storage solutions available.
Wrapping It Up
The seed phrase acts as a safety net that allows you to recover your Bitcoin wallet in case of theft, loss, or damage. Make a solid backup of your seed phrase.
