When you create a cryptocurrency wallet, you’re given two things: a private key, and a public key (or wallet address). The public key serves as an identifier to your wallet, while the private key allows you to sign transactions and claim ownership of your wallet addresses. Your recovery phrase is basically a human-readable form of your wallet’s private key, which you can use to sign transactions and claim ownership of your wallet addresses if the device you use to access your wallet gets lost, stolen or damaged, or if you forget your password.
Why You Need a Recovery Phrase
If you haven’t set up a backup solution for your crypto wallet, you should start doing so immediately. Don’t wait until it’s too late. Your private key is a secret code that gives you access to view and spend funds from a certain public address — and if someone else gains access to that key, they could spend all of your crypto at will.
How To Get One
In almost all cases, you will be given a randomly generated 12, 18 or 24 word phrase. These words are significant because it’s just enough to allow you to restore access to your wallet, but not so much that it would be possible for an attacker to guess it by brute force (the number of possibilities grows exponentially with each additional word). To get one yourself simply create a new wallet address and generate a random seed phrase.
How To Store Your Recovery Phrase
Store your recovery phrases in a safe, secure place, like an offline device. (They won’t help you if they’re on a device that gets hacked.) Store them digitally on an encrypted drive with other valuable data files. You can also write them down and keep them at home, or at work. No matter where you store them, they’re only of use to you if they remain private.
Keep It Safe
Any time you use a hardware or software wallet, make sure to back up your recovery phrases. If you lose access to your coins without having a backup of your seed phrases, they will be gone forever. You might think it’s unlikely that you would lose access to them, but if something happens that causes your computer to break down or get stolen… then yes, those coins are gone for good.