Seed Phrase and Private Keys: What’s the Difference?

Seed phrase and private keys

You will encounter three vital keys to manage your crypto wallets: public keys, private keys, and seed phrases. It is easier to understand the public keys because it is like your bank account number. You can share it with people that want to transact with you.

Things get a little advanced with the other two, private keys and seed phrase. For instance, you must have read instructions that tell you these keys are yours and you must not share them. So, what’s the difference between the private keys and the seed phrase? Let’s go back to the basics…

Cryptocurrency as a Medium of Exchange

Cryptocurrency makes transactions possible between two people without both parties sharing personal details. The process is supported on the blockchain.

To use cryptocurrency, you don’t have to give your personal details to anyone. In layman’s terms, no one would ask for your name, ID card, place of birth, gender, etc.

This is possible because the process is developed to remove this specific barrier: the demand for personal details by third parties like traditional banks.

The absence of the activities and contributions of institutions like banks means there must be other ways to validate or process transactions. It has to be set up so that it is possible to transact or retrieve your wallet without reaching out to anyone.

When you have issues like the inability to access your wallet, you can solve that without needing assistance from a third party. So, how does this work?

That’s where the private keys and seed phrase comes in.

What Are Private Keys?

A private key is like a normal password attached to your crypto wallet. It grants you access to the wallet and allows you to perform transactions. Private keys are made of a series of letters and numbers.

Think of the crypto wallet as an account or a place where you can access everything about your cryptocurrency funds and past transactions.

What Is a Seed Phrase?

A seed phrase is mainly for recovery purposes. It consists of a set of 12–24 words that you can input into a crypto wallet and regain access to your crypto-wallet. With it, you can have access to your private keys again.

In addition, the seed phrase can hold multiple private keys. However, you should know most seed phrases are not recoverable for every wallet. So, find effective ways to keep them where you can get them again if you lose them, like writing the phrase down and keeping them in a steel plate. You can use physical storage or safes in your office or home.

Private keys are a better option. They are used for transactions, but if you lose them, no one can help you recover them.

Your seed phrase is your last resort if you lose your private keys. If it’s lost, your account is lost too, so you need to be very careful.

What’s the Difference Between Private Keys and Seed Phrase?

  • The private key is the ultimate identity of the account.
  • The private key allows you to sign crypto transactions
  • The private key enables you to unlock everything about a specific address
  • The Seed phrase is just a way to store the private key and allows for multiple private keys to be stored under the same seed phrase

The Similarities Between Seed Phrase and Private Keys

  • They grant you access to your crypto wallet
  • They are private. You shouldn’t share them with anyone unless you want them to get access to your wallet.
  • When you use a crypto wallet, they automatically generate them.

The Differences Between Seed Phrase and Private Keys:

  • The seed phrases consist of 12–24 words that are easy to remember, while the private keys are usually a combination of letters and digits.
  • Your Private Keys are used to sign transactions while your seed phrase is used to generate the private key to sign your transaction
  • A Seed phrase can hold multiple Private Keys.

Conclusion

The seed phrase and the private keys are your access to your wallet. They protect your transaction, but they are different and have different functions. You must not share them with anyone. They allow you to access your crypto wallet. However, losing the seed phrase and private keys means you have lost access to your wallet.

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