If you have read our password basics guide, you already know more about crypto safety than you might think. Long, random and private are still the rules. But one thing changes everything, and it catches new crypto owners out: there is no reset button.
No crypto experience is needed for this article. If you have never owned any, you can stop here with a better understanding, or carry on to our guide on what a recovery phrase is.
What a seed phrase is
When you set up a crypto wallet, it shows you a list of 12 or 24 ordinary words. This is called a seed phrase, a recovery phrase or a mnemonic. All three mean the same thing.
Those words are a human-friendly way to write a very large random number. From that number, your wallet can recreate every key it uses. Have the words, and you have the money.
The big difference: nobody is above you
With a normal password, there is always someone above you. Your bank can check your identity and let you back in. Your email provider can send you a reset link.
With a seed phrase, nobody is above you. No company holds a copy, no support desk can look it up, and the network that runs the coin has no idea who you are.
- A company checks it
- Forgot it? Reset it by email
- Stolen? Change it and ask for help
There is a safety net
- Nobody checks it but the maths
- Lost it? No reset exists
- Stolen? Move your funds, fast
No safety net at all
How to think about it differently
Almost every habit you learned for passwords has to change:
| Situation | Password | Seed phrase |
|---|---|---|
| You forget it | Reset by email | Your funds may be gone for good |
| Someone steals it | Change it, and call support | Move your funds at once, before they do |
| Where it belongs | A password manager | Offline, on paper or steel |
| Where you type it | The real website | Only into your own wallet when restoring it |
| Fraud protection | Your bank may refund you | Transactions are final |
| Extra lock | Two-factor login | Optional passphrase, sometimes called the 25th word |
Why you must never type it online
Good password advice is to check you are on the real site, then log in. With a seed phrase, there is no real site to log in to. Your wallet never needs it for daily use. You use it only to restore a wallet, and that should be a rare event.
So any website, app, email or person asking for your words is a scam, every time. This one rule prevents most crypto theft. Read more in nobody legitimate will ever ask for your seed phrase.
What stays the same
Your password skills still apply. Your exchange accounts, email and wallet apps all use ordinary passwords and two-factor login, and your email can be a way into all of them. Fix those first.
Passphrases also cross over. The random-word idea from our passphrase guide reappears as an optional extra protection on crypto wallets, known as the 25th word, which is where this site gets its name.
Where to go next
If you own crypto, or plan to, read these in order:
- Seed phrase vs private key vs public key, to understand the pieces.
- How to write down a seed phrase correctly, to make your first backup.
- What happens if you lose your seed phrase, to see why the backup matters.