Inheriting cryptocurrency can feel like uncovering buried treasure, but it often comes with hidden risks—especially when you stumble upon a recovery phrase or seed words. These seemingly innocuous strings of words are the master keys to digital fortunes, and mishandling them could lead to devastating losses. At Succession, we help families navigate these discoveries with care, turning potential pitfalls into secure inheritances. In this post, we’ll explore common ways these phrases are stored, why they’re so powerful, and—most importantly—how to protect them from theft or scams.

Understanding Recovery Phrases and Seed Words

A recovery phrase, often called a seed phrase, is a sequence of 12 to 24 random words generated when setting up a crypto wallet. It’s based on standards like BIP-39 and serves as a backup to restore access to your funds if the original wallet is lost, damaged, or forgotten. Think of it as the DNA of your crypto holdings—enter it into compatible software or hardware, and you regain full control.

Crypto enthusiasts store these phrases in various ways to protect against loss or disaster:

• Written on Paper: The simplest method—handwritten on a sheet of paper, perhaps folded and tucked into a safe, envelope, or book. It’s low-tech and fire-resistant if stored properly, but vulnerable to water, fading, or accidental discovery.

• Stamped or Etched into Metal: For durability, many use metal plates or cards where words are punched or engraved. Brands like Cryptosteel or Billfodl offer these, designed to withstand fires, floods, and corrosion. You might find them in a fireproof safe or safety deposit box.

• Other Popular Methods: Some split the phrase across multiple locations (e.g., Shamir’s Secret Sharing for added security), engrave it on jewelry or custom objects, or use encrypted digital backups (though this is riskier for non-experts). Avoid assuming it’s just gibberish; words like “apple zoo witch” could unlock millions.

These storage methods reflect a user’s commitment to self-custody, but they also mean the phrase is the single point of access—and vulnerability.

The Power and Peril of Seed Phrases

What makes seed phrases so critical? They derive the private keys that control your crypto. With just the words, anyone can import the wallet into apps like Electrum, MetaMask, or even a new hardware device. You don’t need the original hardware wallet (like a Trezor or Ledger) to drain the funds. Transactions happen in minutes, often irreversibly, across blockchains like Bitcoin or Ethereum.

If you’re sorting through a loved one’s estate and find one, congratulations—you’ve likely discovered valuable assets. But pause: this is where many heirs go wrong. Scammers prey on the uninformed, and even well-meaning family members can expose the phrase accidentally.

Critical Steps to Protect a Found Seed Phrase

Finding a seed phrase is a high-stakes moment. Treat it like a winning lottery ticket in a crowded room—exposure could mean instant loss. Here’s how to handle it safely:

1. Secure It Immediately: Store the phrase in a tamper-evident envelope or safe. If it’s on paper or metal, keep it offline and out of sight. Don’t leave it lying around where visitors, cleaners, or relatives might see it.

2. Avoid Digital Copies at All Costs:

   • No photos with your phone—cloud backups or hacks could expose it.

   • No typing into websites, even “recovery tools” that promise to check balances. These are often phishing sites designed to steal phrases.

   • No entering into Word, Excel, Google Docs, or any app. Keyloggers, shared access, or breaches could compromise it.

3. Don’t Share or Test Alone: Resist the urge to “verify” it yourself. Inputting the phrase anywhere online broadcasts it to potential thieves. If you need to assess the wallet’s contents, use air-gapped (offline) methods or consult professionals.

4. Beware of Scams and Insider Risks: Scammers might pose as support from exchanges or wallets, asking for your phrase. Even unprincipled acquaintances could misuse it. Remember, legitimate services never request your seed words.

5. Plan for Secure Recovery: If the phrase is for a hardware wallet you’ve also found, pair them carefully offline. For larger estates, consider professional custody during probate.

Mishandling a seed phrase isn’t just a mistake—it’s an invitation to theft. We’ve read about cases where heirs lost everything by snapping a quick photo or emailing the words to a “helper.” Protect it fiercely to honour your loved one’s legacy.

When to Seek Expert Help

Navigating seed phrases requires expertise to avoid irreversible errors. At Succession, our specialists can help you verify, recover, and transfer assets securely without exposing your phrase. We guide you to ensure everything stays protected.

If you’ve found a recovery phrase or suspect one exists in your relative’s belongings, don’t go it alone. Contact us for a confidential consultation. By acting wisely, you can safeguard these digital assets for your family’s future—turning a complex discovery into a lasting benefit.