After generating your seed phrase — using your own entropy — and writing it down on something that will last a lifetime, the next step is to store your seed phrase in a location that’s safe from being lost, stolen, destroyed, or seized.
Thoughtful and careful seed phrase storage is third of 4 steps to properly secure your seed phrase:
Step 1: Generate Your Seed Phrase (Randomness + Verification)
Step 2: Write Your Seed Phrase (Paper & Metal)
Step 3: Store Your Seed Phrase (Location)
Step 4: Recover Your Bitcoin Wallet (Privacy, Security, Wallet Settings)
Storing Your Seed Phrase The Right Way
There is no single correct place to store your seed phrase. Everyone has different threat models and access to different levels of security. In order to best store your seed phrase safely, you will need to decide where you think is the most secure location based on your own particular risks and circumstances.
Adding too much complexity can be a bigger risk than keeping things simple, because there are countless ways to lock yourself out of your wallet — but there is only one way to unlock it. Every layer of complexity that you add increases the odds that you will be unable to access it in the future and your bitcoin will be gone forever.
You don’t want that to happen.
Store your seed phrase somewhere simple enough that you can easily access it in an emergency but just complex enough that it would stop a bad actor from accessing your bitcoin.
Safeguarding Your Seed Phrase From Yourself
Statistically, the biggest threat to your own seed phrase storage is actually you. There are countless stories of people accidentally throwing their seed phrases away, corrupted hard drives, destroyed by the elements, or compromised by storing it on the cloud.
As I have said before, complexity is the enemy of security. To keep your seed phrase as safe and simple as possible, stamping, punching, or etching it into metal and storing it in a location that is safe from natural disasters strikes the best balance.
This might be as simple as keeping it at your house in a location that nobody would look and that won’t accidentally be thrown away. For larger amounts of bitcoin though, you might need to invest more time to find a good stash spot.
When you punch your seed phrase into steel, you are much less likely to accidentally dispose of it because it looks and feels too important to just throw away. Additionally, if you use a paper shredder to dispose of paper documents, having your seed phrase stamped into metal would prevent it from being accidentally or intentionally destroyed by a shredder.
If I was rich, I would probably stamp a copy of my seed phrase into titanium and store it safely in my gated citadel community in a jurisdiction with good stand-your-ground laws and private property rights.
If I was homeless, I would probably run a bitcoin wallet from a USB thumb drive and keep my 24 seed words on a DIY metal plate, and use a passphrase that’s easily accessible from anywhere in the world.
Chances are that you are somewhere between rich and homeless so you will have to decide what works best for you.
Storing Your Seed Phrase Safely With Friends & Family
Another factor in ensuring robust seed phrase storage is protecting it from others who might accidentally destroy, damage, or access your seed phrase.
This can be difficult to balance. You want to retain full custody while you’re available, but you will also want your loved ones to be able to access your bitcoin in the unfortunate event that you are somehow unable to access it yourself. That could happen due to unforeseen imprisonment, injury, or even death.
One possible way to store your seed phrase where your loved ones have access but are unable to empty your wallet is to use timelocks and passphrases. You can give passphrases to each of your loved ones who can independently access their own wallet under the same seed phrase. Timelocks could limit when funds are spendable to serve as a sort of Bitcoin annuity payment for each of your loved ones on a predetermined schedule.
Using both of these methods together could prove to be a powerful way to store your seed phrase at a location that is easily accessible by your loved ones, while also limiting who has access to your bitcoin and when they can access it.
Storing Your Seed Phrase Safely From Bad Actors
Probably the more obvious threat to your seed phrase is someone who simply wants to steal your bitcoin. There’s an endless supply of scammers and hackers online, so naturally more and more victims lose their seed phrases to thieves as bitcoin grows.
The first and best way to protect yourself from these sorts of attacks is to not talk about your bitcoin. This can be difficult for some — since you might love to talk about bitcoin — but it’s important to avoid talking about YOUR bitcoin.
There’s a Bitcoin meme based on the movie Fight Club:
Storing Your Seed Phrase Safely From Search & Seizure
One of bitcoin’s most important value propositions of bitcoin is that it is “unconfiscatable”. While it’s true, however, it definitely requires some planning. If you take proper care, you can completely protect your bitcoin by storing it somewhere that can’t be taken by force.
If you are preparing for any sort of 6102-level event in your country and your government outlaws possession of bitcoin where you live, it would probably be best to not store your non-KYC bitcoin with the same addresses that any of your KYC bitcoin are associated with. Create a separate wallet and store the seed phrase for it entirely separately. If you do mingle the funds, however, it may be best to use a multisig wallet setup to prevent your bitcoin from direct authoritarian seizure.
If all of your bitcoin is KYC and you need a clear and auditable paper trail (like in a Bitcoin IRA), then it might make sense to use a service like Unchained Capital to decentralize your risk by protecting your bitcoin with multisig, and never storing all of your private keys in the same physical location.
Storing Your Seed Phrase Safely From Disasters
Storing your seed phrase somewhere safe from natural and unnatural disasters is yet another important part of protecting your bitcoin. When we are making our mental threat models, we probably don’t take into account that there could be a catastrophic disaster that could completely relocate or bury an entire house. What good is stashing your seed phrase in an underground bunker if the air becomes contaminated from a toxic chemical fire caused by a derailed train?
Here are just some of the catastrophic level events that could potentially compromise your seed phrase storage location:
- Floods
- Landslides
- Earthquakes
- Sink holes
- Explosions & chemical fires
- Tidal waves & tsunamis
- Forest fires
- Tornados
- Volcano eruptions
- And anything else that could potentially destroy or relocate your entire house.
Obviously, these are pretty specific hypotheticals, but protecting yourself from catastrophic events is equally important to ensuring a truly immutable, immovable Bitcoin stash.
While all of these disasters don’t necessarily have the ability to move an entire house, they may render it impossible for you to access your seed phrase. It could be a grand natural disaster or just a simple bridge burning down or a road washing away.
If you live in a part of the world where you have to worry about tornados but not floods, then storing your seed phrase underground might be a safer place. If you live in a potential flood zone, though, burying your seed phrase obviously might not be as great of a choice. If you live on the beach, and there’s even a small chance that your house could get swept out to sea or destroyed by a tidal wave, then simply storing your seed phrase in the house isn’t going to cut it either.
You don’t want to end up in this situation:
Tips To Safely Store Your Seed Phrase
Once you’ve purchased or created a reliable metal backup to write your seed phrase on, you can start thinking about where to keep it.
As mentioned earlier, there is no absolute best place to store your seed phrase, but there are certain characteristics that make a good hiding place. The more characteristics your hiding place has, the safer your seed phrase is. Depending on how much bitcoin you have and how privately you were able to get it, there are ways to store your seed phrase anonymously for decades and beyond.
I will go into some detail on each one, and you can decide where to safely store your seed phrase based on your own particular circumstances and what physical space you have access to.
Keep Your Seed Phrase Clear From KYC
If you’ve been fortunate enough to receive any non-KYC bitcoin, you probably don’t want to store the seed phrase anywhere near the physical address you used to purchase any KYC bitcoin that you may have. While it’s probably fine to keep your KYC bitcoin at your physical KYC address, keep your non-KYC bitcoin somewhere that is completely disconnected from your physical address and identity.
If you’re able to live a Bitcoin double-life, keep your non-KYC bitcoin unassociated with your physical address.
Isolate Your Seed Phrase
While it might be tempting to store your seed phrase along with your other valuables such as cash, jewelry, or gold bars, it’s best to keep your bitcoin separate from all of your other valuables. In the unfortunate event that someone robs you, you don’t want your bitcoin stolen along with all of your fiat paper money and shiny pet rocks.
It’s best to keep your bitcoin in a location all by itself.
Make Sure It’s Easily Memorable
You want to make sure that where you store your seed phrase is unique and memorable. If you can’t remember where you put your seed phrase, then your bitcoin is lost and gone forever. If you have decided to use passphrases and/or timelocks, be sure that everyone in your family is able to easily memorize the location and how to get there.
For easy access to your seed phrase after your memory begins to fade, store it somewhere memorable. Remember: security doesn’t need to be complex.
Prioritize Permanence
If a flood can wash away your house or erode your stash spot, then it’s not the best spot to store your seed phrase for years, let alone decades. Make sure that wherever you store your seed phrase, it’s still going to be there even after you wake up from a coma or get out of jail.
Prioritize Accessibility
What good is having any bitcoin if you can’t physically access it? When you are planning on recovering your wallet, make sure that you have physical access to your stash spot. If you buried it in the middle of the woods, make sure that you can easily access those woods and that they aren’t in any sort of a flood plane, sinkhole, or other natural disaster.
If you store your seed phrase somewhere that has a balance of as may of these characteristics as you possibly can, your seed phrase should be as safe as it can be for your particular threat model.
What To Avoid For Proper Seed Phrase Storage
While there is no single correct place to safely store your seed phrase, there are absolutely a number of unsafe places and methods. The simplest plan is usually the best plan. Don’t over-engineer your storage method to the point where you lock yourself out of your own Bitcoin wallet forever.
Unfortunately, there is a lot of bad advice out there that leads many new Bitcoin users toward poor security practices and even straight up scams targeted at unsuspecting newcoiners. To prevent any catastrophic loss, please avoid these unsafe seed phrase storage methods.
Avoid Internet-Connected Computer Storage
Keeping your seed phrase on any sort of internet-connected device is one of the least secure ways to store your seed. Your computer is vulnerable to loss, theft, fire, water, hacks, viruses, malware, hard drive failures, and more. Desktop wallets are great for keeping small to moderate amounts of bitcoin on to do things like online spending and CoinJoin but it’s best to avoid keeping too much bitcoin on any sort of internet-connected device.
Until you have an in-depth understanding of how to store files on your computer in a secure manner, it’s best practice to avoid storing your seed phrase on a computer.
Avoid Cloud Storage
What most people don’t know about the cloud is that it’s simply someone else’s computer. When you upload data “to the cloud,” you are just transmitting that data to someone else’s computer. If you decide to store your seed phrase on the cloud, you risk having your seed compromised by whoever runs that cloud server.
If you don’t know a lot about encryption and how the cloud works, don’t store your seed phrase on a device that is connected to the internet.
Avoid Screenshots
Since your computer and smartphone are able to connect to the internet wirelessly, seed phrase screenshots are also vulnerable to online attacks.
Since many apps and cloud services have access to the photos stored on your phone and computer, it is possible for a bad actor to transmit your photos to third-party servers (such as Google, Apple, Facebook, and dozens of other apps that have access to your photos) without your knowledge or consent.
To keep your bitcoin as safe as possible, never capture screenshots or images of your seed phrase.
Avoid Excessive Passphrases & Encryption
Using too many passphrases and encryption is yet another layer of complexity that stands between you and your bitcoin.
If you choose to encrypt your wallet.dat file or use a passphrase for your wallet, be sure you have plenty of backups and know how to use them. Unfortunately, there are way too many stories of people who have locked themselves out of their own wallets because they lost or forgot their decryption keys or passphrase.
Until you have an in-depth understanding of how passphrases and encryption work, it’s best practice to avoid using them.
Avoid Just Memorizing It
While it may be tempting to try to memorize your seed phrase, it’s not a safe long-term solution since over time your memory fades.
In the event that you would like to pass bitcoin along to others as an inheritance, you don’t want to forget or not have a hard record that can be passed on to someone else.
Avoid Splitting Up Your Seed Words
Splitting up your seed words poses a risk of loss for a couple of reasons. In the event that someone finds a part of your seed phrase, they may be able to guess the missing words using a brute-force attack.
Furthermore, if you do not have 100% of your own seed words, then you are unable to recover your wallet unless you are able to guess your own missing words using the same sort of brute-force attack.
A multisig seed phrase configuration is the best option if you want to decentralize the risk of having your seed phrase compromised.
Avoid Adding Decoy Words & Changing Word Order
By using decoy words or rearranging the words in your seed phrase, you run the risk of permanently locking yourself out of your wallet and losing all of your bitcoin.
Swapping and using decoy words may work well for short-term storage, but as your memory fades, you run the risk of forgetting which words are real and which ones aren’t. In the event that you forget which words are decoys, you will be locked out of your wallet and your bitcoin will be lost.
Avoid Making Too Many Copies
While the purpose of a seed phrase is to preserve at least one copy in a secure location, storing a second copy may help decentralize your risk.
Just make sure you don’t create so many copies that it becomes impossible to keep track of them all. The more copies you make, the higher the likelihood that one of them may be compromised.
Avoid Safe Deposit Boxes
Owners of a safe deposit box as well as any number of government agencies have a history of seizing safe deposit boxes. To eliminate the risk of anyone seizing the contents of your box, it’s important to always have control of your own seed phrase. If you take self custody of your bitcoin, but then hand the seed phrase over to a custodian to keep safe, consider that bitcoin just another IOU.
If you are using a multisig wallet, storing one of your seed phrases in a safe deposit box might be more reasonable since your bitcoin won’t be compromised in the event that you are unable to access to contents of your deposit box.
Avoid Anywhere Visible To Cameras
Not only should you store your seed phrase somewhere safe from physical damage, but you should also keep it away from prying eyes like cameras of any type. This includes the cameras on your smartphone, tablet, desktop, laptop, smart home gadgets, GoPros, and even the security cameras at your neighborhood coffee shop.
If there is a camera nearby when your seed phrase is visible, it is possible that it captured and thus compromised your seed phrase.
Avoid Password Managers
To ensure that your seed phrase is never exposed to any internet connected device, you should also avoid using a password manager to store any of your words. If there is some sort of weakness or hack that happens with your password manager, your seed phrase will be compromised and you will lose all of your bitcoin.
Password managers are a great tool for generating secure passwords and storing usernames and passwords for some online services, but your Bitcoin stack is much more important than most (if not all) of your online services.
Final Thoughts
Now, most people stop here after properly storing their seed phrase. It’s safe, right? Well, maybe. But have you tested your backup?
The important thing to remember when storing your seed phrase is that there is no single right way to do it. Everyone is different and has different threat models and risk tolerances. You need to protect it from yourself, your loved ones, bad actors, unreasonable search & seizure, and any catastrophic disasters that could potentially prohibit your ability to access it.
Avoid all of the unsafe places and don’t overthink it until you have enough bitcoin that you need to dedicate the time and resources to secure your seed phrase. When you do, it’s best practice to keep it simple. For most people, the best way to store your seed phrase long into the future is stamped into steel or titanium and put somewhere permanent that you’re not going to overlook or forget.
The more complexity you add to your seed phrase, the more likely you are to accidentally lock yourself out of your Bitcoin wallet forever. Find a balance between security and simplicity that fits you and your life circumstances.
Finally, the most important part of safely storing your seed phrase is that you can access it for the rest of your life and beyond. Test your backups, store your seed phrase securely, and manage your privacy effectively to mitigate any and all risks.
The fourth and final step to secure your seed phrase is safely recovering your Bitcoin wallet.
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