A seed phrase, also known as a mnemonic or recovery phrase, is the master key to your entire crypto wallet. If it’s compromised, your funds can be stolen in an instant — and you won’t have any way to restore your funds.
The safest way to protect this crucial information is to keep it entirely offline, away from any internet-connected device. In other words: Storing your seed phrase online will introduce an enormous risk that could cost you your crypto assets.
Unfortunately, many crypto investors ignore this risk — after all, if you’ve got a 24-word phrase that will help you restore your crypto in an emergency, why wouldn’t you add it to a Google Document or save it in Wordpad?
Today, we’re going to explain why this is always a bad idea. If you’ve lost access to crypto, call 1-800-237-4300 or open a ticket online to discuss your case with an expert.
Your Seed Phrase Is Your Crypto, Period
A seed phrase is different from a regular password. First of all, it’s structured differently: It’s typically a sequence of 12 or 24 simple words that can be used to restore your cryptocurrency wallet on any compatible device.
And unlike a password:
- Your Seed Phrase Cannot Be Changed: If someone gains access to your seed phrase, you cannot simply “change the password.” They have permanent access to your private keys and can drain your wallet..
- It’s a Master Key: It doesn’t just protect one account (unless you only have one account, which is rare if you’ve performed a few transactions). The seed phrase restores all accounts, private keys, and public addresses associated with your wallet.
The seed phrase isn’t intended to work like a password — it’s more like the key to a bank vault. If you lose that key or someone makes a copy, the contents of the vault are no longer secure.
Common Digital Storage Methods and Their Dangers
Even seemingly secure digital storage methods create vulnerabilities that bad actors can exploit. And regardless of your technical proficiency, you can also become a victim. As crypto recovery specialists, we’ve seen many, many intelligent people fall victim to these scams.
Here are the most common places people store their phrases and how digital storage creates risks.
Screenshots and Photos
When your wallet software generates a BIP39 key phrase, it tells you to write it down — but you’ve got a camera in your pocket, so why spend all that time writing?
The issue is that image files are typically unencrypted, and they’re prime targets for specialized malware. Hackers can deploy malicious software that specifically scans a device’s file system and photo gallery for images that contain the distinct 12 or 24-word format of a recovery phrase.
As A.I. has improved, these types of attacks have become more common (and significantly more profitable for bad actors).
Cloud Storage (Google Drive, Dropbox, iCloud)
Your cloud storage account is a high-value target for hackers. If your email account (which is often linked to cloud storage) is compromised through a phishing attack or data breach, an attacker can gain access to every file you have stored — and if they know that you own crypto, they’ll start looking for seed phrases immediately.
Here, it’s important to note that while BIP39 seed phrases seem random, the words are derived from a specific list. It’s fairly easy to search through a cloud storage service for words that could qualify as a seed phrase.
Email and Messaging Apps
Emailing your seed phrase to yourself or saving it in the drafts folder is equivalent to sending your house key in a clear envelope through the mail.
Email accounts are frequently compromised, and messaging platforms can have vulnerabilities. Once an attacker gains access to your email, they can simply search for keywords like “seed,” “recovery,” “wallet,” or “MetaMask” to find your phrase.
Given the proliferation of identify theft on the dark web, the worst place to keep your seed phrase might be in an email draft or a direct message on a service like Facebook.
Password Managers
Password managers are an excellent tool for securing traditional passwords. However, storing a seed phrase in one concentrates all your risk in a single digital location. If your password manager vault is ever breached — either through a compromise of the service itself or by an attacker tricking you into revealing your master password — your seed phrase will be exposed along with all your other credentials.
Secure Storage: An Action Plan
The industry-wide best practice for seed phrase storage is simple: keep it offline. This eliminates virtually all forms of remote hacking.
- Write It Down on Paper: The most straightforward method is to write the words on paper. Ensure the words are spelled correctly and are in the proper order. Store this paper in a secure, private location like a fireproof safe or a bank deposit box.
- Use Metal Storage: For greater durability against fire or water damage, consider a metal seed storage device. These devices allow you to stamp or engrave your seed phrase into a resilient piece of metal. (We don’t directly endorse products, but options from companies like Cryptosteel or Billfodl are well-regarded and designed for this purpose. They can be expensive — but so is your crypto).
- Create Multiple, Secure Backups: Never rely on a single copy. Create at least two physical backups and store them in separate, secure geographic locations.
What If You’ve Lost Part of Your Seed Phrase?
Accidents happen. A physical backup can be damaged, a word can become illegible, or you might realize you wrote down only 23 of the 24 words. In these situations, recovery is often possible.
As we’ve discussed throughout this article, seed phrases are generated based on a technical standard called BIP39. This standard uses a specific list of 2048 words.
Because this system is deterministic (meaning it follows a predictable mathematical process), a partially lost phrase can sometimes be reconstructed. The final word in the phrase, for instance, acts as a “checksum” — a form of validation derived from all the previous words.
If you have most of your words but are missing one or two, or you’re unsure of the correct order, we can attempt a recovery. This is done through a sophisticated process where we try every possible combination until we find the one that validates the checksum and grants access.
This process is computationally intensive, which is why we use purpose-built hardware equipped with powerful GPUs (Graphics Processing Units). GPUs are designed for parallel processing, meaning they can run thousands of calculations simultaneously. That makes them suitable for testing the billions of combinations required to find a missing seed word.
Your Crypto Is Only as Secure as Your Seed Phrase
At Datarecovery.com, we understand the immense stress of losing access to your crypto assets. That’s why we’ve invested in developing proprietary hardware and software specifically for complex recovery scenarios like partially lost seed phrases.
We offer a risk-free evaluation of your case, and our “no data, no charge” guarantee means you only pay if we successfully recover your assets. If you have a damaged or incomplete seed phrase and need professional assistance, contact our experts at 1-800-237-4200 or submit a case online for a confidential and free consultation.
