Crypto wallets, unlike traditional banking systems, operate on a decentralized ecosystem. Hence, if you lose your wallet without backing up properly, chances are that your funds might be gone forever. That’s why securely backing up your crypto wallet is one of the most essential steps for anyone investing in the blockchain. 

This article will guide you on how to back up your wallets safely, best practices, and common mistakes to avoid, ensuring your digital assets remain secure and protected.  

What is a Crypto Wallet

Crypto wallets are essentially software that lets investors interact directly with the blockchains. The primary use of the wallets is to keep your assets safe and secure. And to store your crypto coins, a wallet requires two basic information: wallet address and private key. Regardless of the type of wallet — hot wallet or cold wallet — you use, you need the private keys to access your coins, as the wallet does not store crypto directly. 

Why Should You Back Up a Crypto Wallet

Crypto wallets don’t actually store your coins, but the private key that lets you access your coins on the blockchain. If these keys are lost due to various reasons, including device failure, theft, or human error, you’ll lose access to your crypto permanently. 

Backing up your crypto wallet properly ensures that you can recover your funds if your device is lost, stolen, damaged, or hacked. A secure backup ensures your investments stay safe, accessible, and protected no matter what happens.

Ways to Back Up a Crypto Wallet

Store Offline

There’s a high chance of getting hacked if you store your seed phrase on devices that connect to the internet. Hence, the best option is always to store it offline, as it negates all the chances of others getting access to your digital assets. It’s always better to have more than one copy of the seed phrase, stored in different locations. 

Splitting the Speed Phrase

Another method for storing your private keys is by splitting each word of the seed phrase and storing it at different locations. Though this can be done both virtually and physically, storing your private keys as physical copies is considered a much safer option. 

Using a Hard Drive

Storing your recovery phrase on a hard drive or a USB is convenient and portable, allowing you to access your crypto keys by connecting them to your personal system. However, the security offered by the hard drives or USBs is in question, as they are susceptible to both malware infection and cyber threats. You can work this out by storing your hard drive in a safer location or by splitting the recovery phrase and storing it on multiple hard drives. 

Solid Steel Back Up 

While writing down on paper secures it from hackers, it is not the most durable material and can fade with time, making your seed phrase ineligible. Furthermore, the chances are that your paper backups could get burned in a fire. Hence, solid steel backups are a much better option. 

• ELLIPAL Mnemonic Metal: These are a premium backup tool for 12/15/18/21/24 recovery phrases, made from solid steel. It is a fire, water, insect, and mold-resistant device. 
• Capsule Duo: Made from solid steel, the capsule duo is made to survive extreme conditions. It is also compatible with most of the secret sharing and key-generating algorithms.
• Billfodl: This is a solid steel case that stores your 24-word seed phrase. It comes with character tiles that can be used to recreate your seed phrase. Billfodl is resistant to fire, water, and other elements, making sure your seed phrase is backed up indestructibly. 

Stonebook Notebook

A unique method to store your seed phrase, a stonebook notebook is a notebook with durable, water and tear-proof pages. You can add to the security with the help of a ghost pen. This type of pens uses a special type of ink only visible under UV light. However, you will have to keep it in a fireproof safe. Compared to the solid steel backup methods, this is a budget-friendly option. You can store up to 50 crypto wallet seed phrases in a single notebook. 

Cloud or Online Back Up

Though some investors choose cloud backup options, it is generally considered less secure since it will place your private keys with third parties. Through strong encryption, use this method as your secondary storage option and not your primary. 

Best Practices for Backing Up the Wallet

• Keep your backup private and never share the seed phrase with anyone. 
• Conduct regular backup checks every few months to ensure it is still intact and safe.
• Consider a multi-authentication wallet, as this reduces the risk of single-point compromise, accidental loss, or insider theft.

How Not to Store Your Recovery Phrase

• Writing down the recovery phrase in a digital notepad on an internet-connected device.
• Taking photos or screenshots of your private key.
• Jotting it down on sticky notes on tables or walls.
• Letting someone else set up your wallet. 
• Using online seed recovery sites without checking the site’s credibility. 
• Saving your seed phrase in an email or a text message.
• Depending completely on your memory.
• Backing up only the private keys and not the seed phrase. 

Benefits of Backing Up Your Bitcoin Wallet

More than just having a seamless recovery option, backing up your crypto wallet also has other benefits, such as:

Added Security

There are chances for your phone, laptop, or any other device with your crypto wallet to get stolen or to crash out. To avoid losing access to the wallet along with the device, creating a secondary storage option for your private keys can offer an added layer of security. 

Smoother Control of Assets

In cases where you lose your device with the wallet in it, having the wallet information backed up can help you recover your digital assets seamlessly. 

Conclusion

Securing your wallet requires careful planning to ensure that your seed phrase is safeguarded, no matter what happens with the device. If you have your recovery phrase intact, your funds remain accessible and under your control.

There are different methods to store your crypto wallet, each with its own advantages and benefits. Before selecting a backup method, make sure you are entirely aware of the storage option you are choosing, including any risks posed. Whatever method you choose, make sure you’ll be able to access your wallet in case the primary device is lost.