When using a non-custodial wallet, hackers pose a significant threat to your crypto assets. If your wallet is compromised, you may lose all your funds and never regain them. Therefore, it is vital to safely secure your wallet’s seed phrase or recovery phrase as though your life depends on it.
When using a non-custodial wallet, you are in charge of your assets. You are your own bank, and you can manage and transact your funds as you please. The ability to manage your funds without using a middleman provides you with a lot of power, but as the saying goes, “with great power comes great responsibility.”
What Are Seed Phrases?
A seed phrase is a group of words with 12, 18, or 24 syllables used to generate private keys for each cryptocurrency you hold. In essence, it is a master key in that it allows you to access or recover your wallet anywhere, anytime. So, if anyone else gets access, they can wipe out your funds in minutes.
Seed phrases are created using the (Bitcoin Improvement Proposals) BIP 39 mathematical approach, which encrypts 128-256 bits of random data in 12-24 words. As it is encrypted, only you can see the details of your seed phrase; even your non-custodial wallet provider cannot see it. The 12-24 words are random and are used to encrypt data; the order is meaningless, and the phrase doesn’t relate to any real-life information.
If a device malfunctions, theft, or loss, you can use the seed phrase you have safely written to recover your crypto wallet from another device. Hence, you will gain instant access to the addresses linked with your wallet and the assets.
In other words, seed phrases function as a type of encryption for your wallet’s private keys in a user-friendly and manageable manner.
How to Secure Your Seed Phrase Securely?
Seed phrases encode your wallet’s private keys so that you can quickly recover them. However, hackers always look for an opportunity to infiltrate your wallet by accessing your private keys.
Remember, with non-custodial wallets, you are solely responsible for your assets. So, here are some options for securing your seed phrase.
· Physical Hiding Place: When setting up your wallet, make a precise duplicate of the seed phrase with a pen and paper. Ensure there are no typos (as a single wrong letter will invalidate your recovery); for example, if you write down “overcame” instead of “overcome,” you will be unable to recover your wallet. Also, ensure that the words are written in the correct order, from 1 to 12, 18, or 24.
After writing it down in a book, you can duplicate it in other safe locations, as long as it is offline and out of the reach of third parties. For example, you can keep it in a safe, a floorboard, behind a jar label, or anywhere you find convenient. This helps to ensure that you will always have access to your wallets and funds, regardless of the circumstances.
· Seed Phrase Shattering: You may also split your phrase into two or three different portions and safely store each piece in other places. You could write down the first six in a book and keep them in your library, another six in your diary, and another six in an old magazine. As a result, the complete phrase isn’t entirely available for anyone to steal.
Seed shattering can be done digitally and physically. However, it is NOT advisable to shatter your phrases on the internet (email, drives, pictures). A dedicated hacker may be able to follow the trail and gain access to your wallet.
· Secure Crypto Steel Plate: You may worry about the risks of keeping your phrases in books, papers, or other physical locations. What if your house burns down or gets flooded?
A safe physical alternative to protect the seed phrase is permanently sticking the words on an indestructible stainless steel or titanium metal plate. This method endures the test of time, and even if your home burns to the ground, your seed phrase will survive.
A steel capsule works by using character plates and separator plates to separate each word of its seed phrase. It then secures them together with a thick thread that connects the capsule and core.
Backing up to a steel plate is ideal because it eliminates many problems associated with backing up to paper; nevertheless, as with any physical media, you must keep unauthorized people from accessing the plate. Therefore, before using steel, please keep it safe and consider encrypting the seed phrase.
· Encrypted Hard Drive: Data encryption is the digital equivalent of putting data in a safe. When you encrypt a local drive that contains your seed phrase, you’ll need a key or password to get back into it (depending on what tool you choose to perform the encryption).
Storing your seed phrase on a locally-stored encrypted drive ensures that only you have access to it, providing a high level of data protection. However, it does not offer complete protection against other threats. You are responsible for securing your hard drive extremely safely so that it won’t fall into the wrong hands; a criminal may easily insert this disk into any laptop or computer and access your seed phrase.
Typically, you don’t have the luxury of specifying your seed phrase when creating a wallet; however, if you are presented with this option, don’t do it; to be safe, it’s recommended to leave the seed phrase generation to the wallet software.
NEVER retain your seed phrases in emails, pictures, or other digital media that can be exposed to the internet because there’s a chance they’ll be hacked, and someone else could steal the funds.
Alternatively, suppose you are worried that you cannot keep up with the responsibilities involved in managing a non-custodial wallet. In that case, you could opt for a custodial wallet where you only need to log in with an email address and a self-generated password. Again, this is the best option for beginners new to managing digital assets.
The Best Custodial Crypto Wallet
As said earlier, with great power comes great responsibility. Suppose you are worried that you cannot safely secure your seed phrase. In that case, you can use a custodial wallet that bears the burden of securing your wallet, allowing you to explore the beautiful world of cryptocurrency. With an assurance of safeguarded funds, you can begin investing immediately on CCTip.
What’s more? Unlike other Custodial wallet providers, you don’t need KYC Verification to operate an account with CCTip; your email address is all you need to register. We’ll manage the rest from there.
Easy, right? So, why wait? Get a free CCTip wallet and enjoy fast, simple, cheap, and easy access to crypto, with zero extra fees on all services. Even if you have no money, you can interact with our community members to get free crypto assets from tips and airdrops.
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