A special list of 12-24 words that is the master key to your crypto wallet. It's the only way to recover your wallet if you lose it.
A Mnemonic Phrase is a series of 12 to 24 random words that acts as a human-readable master key to a cryptocurrency wallet.
Think of a mnemonic phrase as the password to your entire financial life in crypto. It is a simplified way to back up a wallet's private-key, which is a long, complex string of characters. Mnemonic phrases were created to make it easier for users to recover their funds if their device is lost, stolen, or damaged.
When you create a new wallet, the software generates a random series of words. You are then instructed to write these words down in the correct order and store them in a safe place. As long as you have your mnemonic phrase, you can restore your wallet on any compatible device and regain access to all your funds.
The importance of keeping your mnemonic phrase private cannot be overstated. Anyone who has access to your phrase has full control over your funds. This is why it is often called a seed phrase or a recovery phrase. It is the last line of defense against a hack. You should never store your mnemonic phrase on a computer connected to the internet, take a picture of it, or share it with anyone.
A mnemonic phrase is a core component of self-custody in Web3. It gives you true ownership of your assets, but with that power comes the responsibility of securing your own funds.
A hot wallet is connected to the internet, like an app on your phone. A cold wallet is an offline device, like a special USB stick, that is more secure.
Short for "multi-signature." It's a type of wallet that requires more than one private key to approve a transaction, making it very secure.
Your public key is like your bank account number—you can share it so people can send you crypto. Your private key is like your password—it must be kept secret and never shared.
