What Is A Seed Phrase?

A seed phrase is a string of 12 to 24 words which can be used to recover your crypto wallet. The words are generated randomly by your wallet when you first set it up. If for whatever reason, you lose access to your wallet, you can download the same wallet software and use your seed phrase to recover your account - hence why it’s also known as a "recovery phrase".

Your seed phrase is literally a key to your wallet and anyone that discovers your secret phrase can steal your crypto. So it's vital that it's kept secret at all times.

It’s vital that your seed phrase is random. Otherwise, it would be easy for a bad actor to copy it just by following the process used by your software. To achieve this your wallet software has to start with something completely random and unique to you.

Browser-based wallets typically use the browser's native Crypto.getRandomValues function, which seeds itself with your operating system's entropy source. This is the best source of random numbers that a browser-based application can provide without your help.

Your wallet software takes this random number and uses it to generate a random list of words. Not just any words though…Most wallets use an English language word list called BIP39, which is a list of 2048 words.

There’s a bit more detail to this, which I won’t bother to cover here. But if you are interested you can check out my post on How Crypto Wallets Work.

Firstly, not all wallets use seed phrases. But those wallets that do use seed phrases, do it so that users can remain anonymous.

Self-sovereignty is one of the core principles behind cryptocurrencies: the idea that you should be able to access your crypto without having to prove who you are, and you shouldn't have to rely on centralised institutions like banks to store it safely.

The idea behind using a 12 to 24 word mnemonic phrase is that a series of simple words are easier for human beings to remember. Whereas a long and random alphanumeric string would be difficult to remember or even transcribe.

Though, I’m not sure anyone makes the effort to remember their seed phrase anyway. And it would be a disaster if you forgot it, so most people just write it down and keep it somewhere safe.

Most wallets advise you to keep it written down on a piece of paper. It’s not advisable to keep it saved in a notes app on your computer, because if your computer is ever hacked - the hacker will be able to steal your crypto.

Always, always, always keep your seed phrase private.

Never share it with anyone.

Never enter it into a website or messenger app.

Remember: anybody who discovers your seed phrase can steal your crypto, so it is vital that you keep it safe like you would a precious family heirloom or a diamond ring.

Theoretically you could create your own seed phrase. However, it’s never a good idea to create your own seed phrase because human beings aren’t good at creating randomness.

No. A private key is not the same as a seed phrase. Multiple private keys can be derived from a seed phrase.

If we’re being honest:

SEED PHRASES SUCK.

I completely get the idea behind self-sovereignty, but seed phrases pose a massive risk in that they’re all or nothing.
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1. If you lose your seed phrase, you lose control of your crypto;
2. If someone else gets hold of your seed phrase, they can steal your crypto.

Seed phrases aren’t appropriate for companies. And let’s face it, the wallets that use them aren’t all that secure.

Krayon uses multi-party computation (MPC), amongst other additional security features, to keep your digital assets secure. Your crypto assets are tied to your corporate wallet which is linked to your organisation, so there’s no need for seed phrases, but you’ll still always be able to recover your wallet.