Sun, 24 Apr 2022 12:22:31 +0000
One of the core ideas of cryptocurrency is the concept of “be your own bank,” i.e., easy access to your crypto assets without having to prove your identity and without dependence on centralized financial institutions such as banks or governments. This is possible due to blockchain technology – which stores and secures crypto assets using a peer-to-peer network of connected computers, which are also known as nodes.
Using an algorithmically generated string of codes, blockchain is able to figure out which assets belong to you. When you sign up to set up a crypto wallet, algorithmic codes of 12-24 simple words like (“crop”, “plant,” “harmony,” “press,” “stand,” “click”) are generated.
These generated simple words, known as the “recovery phase” or “seed phrase,” are used to unlock your wallet anytime, and they are not to be shared with anyone except “your next of kin” or “heir”. Private keys are created in the wallet, using these seed phrases in order to allow you to send or receive your assets.
Reductively, imagine the wallet as the password manager and the seed phrase as the master password to access it.
As mentioned earlier, the seed phrase must not be shared with anyone; thus, keeping it safe is important; otherwise, anyone with access to your crypto phrase can gain access and control of your crypto assets.
What happens if you can’t recollect your seed phrase and your wallet is deleted? It is simple; your crypto is gone forever. This is more than enough reason to safeguard your seed phrase properly and securely, so we will take a look at several ways you can keep it safe and protected.
Before this, it is of importance to have these two key points in the back of your mind.
Now let us have a look at how you store your seed phrase.
Considering the total power control that anyone who possesses your recovery seed will have over your assets, how you record and preserve it is very important. Furthermore, since a seed phrase is to be readily available wherever and whenever you need it, keeping it somewhere safe but easily accessible is essential. Below are some of the ways to save your phrase securely.
Although powerful, this method is not a friendly one. It involves splitting your seed phrase between different sections in multiple different locations. With this method, cybercriminals are kept at bay.
Steel plates and capsules (a major example are the Cryptosteel capsule and Blindfodl steel plate) make it simple and secure to physically store your seed phrase or split seed phrases.
How does it work? A steel capsule works by using both character and separator plates to separate each word of your seed phrase, then locks them in place with a thick thread that connects the capsule’s shell and core.
Unlike the Cryptosteel capsule and steel, which may not be readily available, hard drives are readily available almost everywhere and are economical. Storing your seed phrase on hard drives may look cheap, but they are not secure as it may easily contact computer viruses which may then restrict your access to your seed phrase.
Another limitation is that it may fall into the hands of a criminal, and they can quickly obtain your seed phrase by plugging the drive into any laptop or computer. However, you could spread the seed phrase across two or more drives to make it more difficult to access, but they will still be easy to infiltrate once discovered.
Another way to preserve your seed phrase is to write it out on paper. However, keeping your entire phrase on a single piece of paper in an easily accessible location in your home is not a good idea. If you want to make use of this method, it is advisable to make use of splitting the seed phrase and spread it over numerous secure hiding places in the home and the places should be out of reach from visitors, little kids, and even your pets.
If you are a wordsmith, you may consider saving your seed phrase on a paper by paraphrasing them or using synonyms alike or homophonic words similar to them. This will keep anybody with access to it at bay and not understand your scope.
Although not all of the strategies highlighted above will work for everyone, you should bear in mind that the more obscure, the better. Below are some of the things you should stay clear of:
Keep in mind that the more time and effort you put into correctly preserving and maintaining your seed phrase, the safer your funds will be for you and your loved ones. It is then advisable to combine two or more of the strategies or methods highlighted above.
Want more? Connect with NFT Plazas
*All investment/financial opinions expressed by NFT Plazas are from the personal research and experience of our site moderators and are intended as educational material only. Individuals are required to fully research any product prior to making any kind of investment.