The crypto world uses public and private keys to transact and store things securely in a vault or wallet. These keys are based on long, mathematically generated random numbers, so large that the probability of a matching code is almost zero *). Because we humans have difficulty handling numbers, there is a method to create a source from a collection of 12 to 24 ‘dictionary words’ from which that single long number can be generated. You can compare this set of words, the seed phrase, with a DNA profile, a string of understandable words that allow you to (re)build your digital identity. Keeping this row of words in a safe place offline keeps it digitally safe and secure from online hacking.
Creation and recovery of keys.
From said random number, a private key is cryptographically generated. The appropriate public key is then created with that private key. Similar to public bank account and secret PIN. Up to this point, an online computer is not actually needed, because the key pairs can be derived mathematically, handwritten on paper, and stored in a vault, offline, in this way. Only the public key is used in public, for example in a blockchain ledger, just like your bank account number the private key is never used.
The theoretical chance of exactly two identical keys being created is minimal, because the number of variations is so high that duplicating or hacking a particular key is unthinkable. Today, seed phrases are commonly used, which are translated into English as seed words, which are a collection of 12 to 24 dictionary words that are an unencrypted form of the private key. After all, words are easier for humans to remember than numbers. When a unique key for a wallet is digitally generated using random numbers, the generated ‘seed words’ are the backup to gain access again if the wallet is compromised or if you yourself have lost the digital key. You can compare this set of words to a DNA profile, a row of understandable words that allows you to reconstruct your original digital identity.
Wallets and DApps
If access to a wallet or digital wallet is forgotten, damaged or compromised, the seed phrase can be used by manually entering it and regaining access to the wallet, its key and cryptocurrency. You can also store both your public and private key in that digital wallet and from there you can organize your digital identification (SSI), your communication and your transactions. In the web 3.0 world, decentralized applications are applied, also called DApps or Dapps, which can work in a peer-to-peer blockchain network. DApps are not controlled from a central entity, but, as the name suggests, they are managed in a decentralized manner.
Dapp browsers are considered Web 3.0 browsers. Access to many decentralized applications based on blockchain technology. That means dapp browsers must have a single code system to unify all the different dapp codes. While crypto wallets aim to exchange, buy and sell digital assets and specific applications, Dapp browsers support different types of applications of different formats, including exchange, games, NFT markets, smart contracts, etc. Supported for a long time, dapp browsers generally also support Web 2.0 functionality and technology.
Save seed phrases
As said before, a seed phrase is like the DNA of your digital identity in the crypto universe. In order to have a good secure and reproducible seed phrase, 24-word strings are no longer used today. Also called a mnemonic phrase, this is formally the encoded source of entropy (randomness) that identifies your wallet within the digital universe. In most cases, wallet providers generate the BIP39-based seed phrase for you and then you have to manually overwrite it or keep it secure.
Anything you save just once is a single point of failure. Paper is fragile, flammable and perishable. You can choose to engrave your opening phrase in metal. Stronger than paper and cannot be burned. You can also split your opening phrase into parts and save it in different places. So the chance of someone finding and using your seed phrase is much lower, if you remember where you ‘hid’ those parts. You can also use the ‘storage trick’ by dividing the 24 words into three pieces of paper and writing the words 1-16, 8-24 and (1-8 and 16-24) there. You only have to find two of the three notes to reknow your entire seed phrase. You can even choose to summarize and memorize your 24 words in a story.
BIP stands for Bitcoin Improvement Proposal. BIP39 is a list of 2048 common English words that can be selected to generate the seed of a private key. All words correspond to a number from 0001 (abandon) to 2048 (zoo). A private key is usually an access key to a single address (account), while the seed phrase is the access key to the entire wallet, which may contain more addresses or accounts. The seed phrase is the access key and the instruction to recover both the wallet and all the accounts it contains.
Many wallets support the creation of an additional word, the so-called passphrase, an additional password to limit access to your crypto wallet in case your seed phrase is known or someone else has been given access to your wallet. A passphrase also makes it possible to create multiple crypto wallets from a single seed phrase. You can even create a dummy wallet in case you ever find yourself forced to make your seed phrase public. But keep in mind that you have to remember each password, each additional passphrase. And thus makes your own security more complex. Sometimes good is good enough, that also applies in the world of security.
*) Cryptocurrencies use 256-bit numbers that are very large, up to 77 digits. For example, in normal decimal numbers, this is the access key for an account number: 15692029237316 193423570985008 4879078532689846 65640564039457554 006913129639935.
Esta clave de acceso está escrita en binaria: 1111111111110001110111111110001110000 1010011010111011111111000001011111111110011101111111111111001111 01111111001110000000101000001001110011001111111111111111111111111111111111111111111111111111111111111111111111,11
In hex code it gets a bit easier: ffc7 5e38 535b f82b e5cd 7dbc 75b3 80a0 98cd ed88 affc 28af 793c cb2f dc17 efff
This code is used for a private key. Around 2013, the BIP39 proposal was devised to represent this code in “common” words. But keep in mind that a private key and seed phrase, while linked, are not the same thing and serve different purposes.
By: Hans Timmerman (photo), Chief Data Officer at DigiCorp Labs and Director of Fortierra