Recovery seed

A recovery seed, also known as a seed phrase, refers to a randomized list of words prompted to users during the initial setup of a cryptocurrency wallet. A recovery seed is provided to make sure that in the event that users lose access to their wallets, they can still be able to recover their crypto assets.

In order to recover access to a wallet, a user needs to input the words listed in the recovery seed in the same exact order it was initially provided, which is why it is often advised that wallet owners write their seed phrase down in a piece of paper and store it securely or keep it in a digital storage that no unauthorized person can access.

There are also two-factor seed phrases that reinforce the security provided by recovery seeds. In such a model, users will be asked to put in a password after they have placed their seed phrase. Failure to remember any of the two would result in losing access to one’s digital assets forever.

Back in early January 2021, computer programmer Stefan Thomas became unable to access the 7,002 Bitcoins kept in his digital wallet due to a lost recovery seed. Cases like Stefan’s exemplify the importance of securing your recovery seed.