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What is recovery phrase

The recovery phrase of your wallet, also known as seed (mnemonic) or backup phrase, is a list of randomly generated words displayed in a specific order. The wallet software usually produces the phrase in the activation process.

The software uses a dictionary (as source) with 2048 words for the BIP39 standard (Yes, there is a standard). There is an alphanumeric address that stands behind the combination of words, and that's your private key. You may use both of them, but the combination of words is more user-friendly and more comfortable to memorize.

Recovery phrase security

Some wallets have a two-factor security feature with seed phrase and seed password. It's a combination of two security options. It is also known "as what you have plus what you know". It's an additional way to apply more security to your bitcoins, but it's more complicated than usual (and it's recommended).

The recovery phrase is a synonym of top-secret password with the highest privilege.

The idea of Bitcoin is to be your own Bank, and the recover phrase is the master key to control your bank. Think of it like the pass code to access your Vault.

Why you need a backup phrase

That's your private key which authorizes the ownership of the wallet and everything in it. It contains all the words to recover access to your portfolio at any time. Also, it may be necessary to verify your seed to confirm a transaction (which is a good practice in some cases). It depends mostly on the software of your wallet.
bitcoin mnemonic phrase code

What are the main reasons to use a seed phrase:

  • You prefer to recover the wallet on another device.
  • It's necessary to confirm the access (ownership).
  • If you don't keep the wallet installed on your device, and later you wish to access the funds from a new installation.

Examples:

  1. You configure a wallet, receive the bitcoins, then delete the wallet (it's a common practice to avoid keeping the wallet on any device, also known as cold storage). After that, if you need to get access and you can do that only by using the backup phrase.
  2. The device with your wallet is damaged or lost. You need to grant your access to all funds. Then you can re-install the wallet on another device and recover it.

It doesn't matter what's the size of your bitcoin portfolio. It can be an empty wallet as well. The phrase works in the same way.

In a few words only - the phrase is known as a synonym of ownership when we talk about Bitcoin. That's how you prove who is the real holder. If someone has it, then he/she can use all BTC. It's equal to instant access to all your crypto coins in this wallet/address.

What types of recovery phrases we have? You can use a phrase with 12, 18 or 24 words. The longer the phrase is, the more secure your assets are. Some wallets give you a choice, but others generate directly 24 words.

How a seed phrase works

First of all, there are two types of keys for a bitcoin wallet - Public and Private. The public key is your address that someone can use to send you BTC. The private one is to confirm ownership and use the funds of this wallet. These keys are uniquely connected.

Bitcoin security

You can compare it to a property. People may know your address, but you have the keys to enter the premise. The only difference is that the recovery phrase is more secure (if you keep it well). In other words, no one can enter your property without the keys (it's not possible to break the door, windows, and there is no back-door).

That's how it works, and it's elementary, but for a beginner, it may take some time to understand everything.

That's your granted access at any time, from any device (which is compatible with your wallet)!

How to keep your recover phrase securely

The best practice is to write down your backup phrase and keep it out of digital devices. That's the most popular way to use the so-called cold storage wallets (the most secure vault). If you lose your sentence, you can not recover your wallet (if there are no other security settings to do that).
bitcoin phrase security

Never re-arrange the exact order of your words. If you decide to split the phrase, you need to add the specific order of each combination.

You need to keep the paper in a safe place. Let's say your phrase is written on a paper with a pencil (not a pen). Then you should take care of paper's safety, because it can be burnt, threw away, or damaged by water. That's the next step to secure your Bitcoins.

It may look old-school, but the best digital safety.

How to change your phrase:

The mnemonic phrase cannot be changed. It's unique, and it represents your wallet private key. If you wish to change it, you can create another wallet and transfer your funds to the new one.

How to use a secret phrase

Once you launch the wallet, you can see an option - Create a Wallet, Restore/Recover. If you choose a new wallet, you will see a new combination of words each and every time. For recovery option, it will show a text field to submit your recover phrase (word by word, or the entire sentence at once). A secret phrase may not be compatible with all wallet software. It depends on how the wallet is built. So, you can do that for sure only by using the same software or app (like GreenAddress).
btc  secret phrase

In situations where you're going to receive or buy BTC, it's not recommended to skip the step with writing down the phrase. In a later moment, it may cost you the loss of all bitcoins. So, write the combination of words, keep it well, and apply a passcode to your wallet (2FA is a good option too).

It's a common manner to install a wallet, write the phrase, erase the wallet, and just keep the mnemonic sentence. You need some practice about how it works before you start using real bitcoins. It's like an exercise, but when it comes to Bitcoin, it's a useful experience too.

Final thoughts

You already know what a Bitcoin recovery phrase is, and how to use it. Then you can choose the right wallet with high-security settings, and interface (of course).

Step by step you can dive into the bitcoin world with ease. But doing that slowly is really the best possible way.

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