What are the risks of not having a backup of your seed phrase? Well, we can think of quite a few.
As you know, a seed phrase gives you access to your Bitcoin or other cryptocurrency wallets. If someone other than yourself gets their hands on your seed phrase, they can restore your wallet and access your funds from wherever they are.
It’s something you have to keep safe in order to protect your funds. So what exactly are the risks if you don’t take care of your seed phrase? What can happen if you’re not having a backup of your seed phrase? And most importantly, what’s the best way to make that said backup of your seed phrase?
You can lose or forget your seed phrase if you don’t have a safe backup
Some people make it a sport to remember a large number of decimals of the number pi. There are many tricks to train your memory. So it is possible to memorize your seed phrase, if you want to.
That way no one else knows it, and your seed phrase is, at least temporarily, safely stored in your head. And this without backup on a computer, which has the potential to break or being hacked.
But, no matter how good your memory is, there are always risks involved in keeping the seed phrase only “in your head”.
For example, you may temporarily lose your memory or forget some things over the years. An accident and a concussion are not always fatal, but sometimes you forget things that you knew perfectly well before.
Once you forget your seed phrase, it’s over, and you no longer have access to your wallet and funds.
Not having a backup of your seed phrase makes it impossible to restore your wallet
Everyone forgets a password once in a while. Fortunately, every account or website then has the option to recover your password. You simply enter your username or email address and a new password is promptly sent to you. Easy, but never 100% secure.
In crypto, passwords (seed phrases) are different. You can’t just request a new seed phrase, it’s unchangeable and will be the same forever.
This is another risk of not having a backup of your seed phrase: once lost, you’re not able to reset it, ever.
Managing your own seed phrase gives you more freedom, but also more responsibility than with traditional banking
Crypto works with the principle of self-sovereignty.
When you send or receive crypto, transactions are collectively recorded on the blockchain. This has the great advantage that there are fewer intermediaries such as bankers or lawyers. Everything is stored on a public ledger, available for everyone to see.
This is by the way why banks hate crypto, it largely undermines their business model and they’re afraid of losing powers and control.
That said, the freedom of self-sovereignty also puts all responsibility over your digital assets in your own hands. There is no banker to advise or help you. There’s no one helping to keep your seed phrases safe, or make a backup for you.
Keep your funds safe in crypto is all up to yourself. If you don’t take care of a proper backup of your seed phrase, then there is a risk that your cryptocurrency will be lost one day.
Not having a backup of your seed phrase? Most irresponsible thing to do.
So, what’s the conclusion? As long as you know your seed phrase, you can call yourself the proud owner of your funds.
But once your laptop breaks down or you lose your smartphone, you’re unable to restore your wallet without your seed phrase.
There is literally no valid reason not to make a secure backup of your seed phrase, as long as you do this in a professional and safe way.
And that’s where Safe Haven comes in!
The only safe and 100% decentralized solution to securely backup your seed phrase
At Safe Haven, we are happy to help you with professional solutions to keep your seed phrase safe!
Back to wiki
Looking for a safe and secure solution to make decentralized backups of your seed phrases, secret data and other digital assets? Click here to learn more about our patented solution: Inheriti® »