What is bip39?
Bip39 (Bitcoin Improvement Proposals) describes the implementation of a mnemonic code or mnemonic sentence – a group of easy to remember words – for the generation of deterministic wallets. It consists of two parts: generating the mnemonic, and converting it into a binary seed. This seed can be later used to generate deterministic wallets using BIP-0032 or similar methods.
A mnemonic code or sentence is superior for human interaction compared to the handling of raw binary or hexadecimal representations of a wallet seed. The sentence could be written on paper or spoken over the telephone.
Seed phrase / Mnemonic phrases
Seed phrases are sometimes called “mnemonic phrases” in technical literature. A seed phrase, seed recovery phrase or backup seed phrase is a list of words which store all the information needed to recover a Bitcoin wallet. Wallet software will typically generate a seed phrase and instruct the user to write it down on paper. If the user’s computer breaks, their hard drive becomes corrupted or their hardware wallet get lost, broken or stolen, they can download the same wallet software again or buy another hardware wallet and use the paper backup to get their bitcoins back. The problem with the paper is that can easily degrade, catch fire or get wet and became useless. For this reason we recommend the KryptoDots® Backup Kit to anyone who keeps their words on paper.
Anybody else who discovers the phrase can steal the bitcoins, so it must be kept safe like jewels or cash. For example, it must not be typed into any website, computer software program (notepad, Microsoft Word/Excel/PowerPoint, etc.) or in front of image capturing devices like phone camera or surveillance cameras.
Seed phrases are an excellent way of backing up and storing bitcoins and so they are used by almost all well-regarded wallets.
An example of a seed phrase is: test plate punch zone digital asset advance gadget smart choice easy life
The word order is important.
How secure is my 12/24 backup seed phrase?
The English-language wordlist for the BIP39 standard has 2048 words, so if the phrase contained only 12 random words, the number of possible combinations would be 2048^12 = 2^132 and the phrase would have 132 bits of security and for 24 random words, the number of possible combinations would be 2048^24 = 2^264. However, some of the data in a BIP39 phrase is not random, so the actual security of a 12-word BIP39 seed phrase is only 128 bits. This is approximately the same strength as all Bitcoin private keys, so most experts consider it to be sufficiently secure. However, the security of a 24-word BIP39 seed phrase is considered very secured at about 260 bits of actual security.
It is not safe to invent your own seed phrase because humans are bad at generating randomness. The best way is to allow the wallet software to generate a phrase which you write down.
The power of backups