Private Key/Secret Key

November 21, 2023 - Around 2 mins mins to read

Understanding the Concept of Private Key/Secret Key

A private key, also referred to as a secret key, is a unique alphanumeric string that is generated during the creation of a crypto wallet address. It functions as a password or access code for the wallet. Possessing the private key grants complete control over the associated wallet, including access to funds, the ability to transfer or trade assets, and other account functionalities.

Due to the irreversible nature of blockchain technology and the cryptographic derivation of private keys, it is impossible to modify or alter private keys. Therefore, if a user suspects that an unauthorized individual or entity has knowledge of their private key, the only solution is to create a new wallet and transfer the funds to it for enhanced security.

Private keys can be stored in various ways. The most basic and vulnerable method is through a direct seed code, such as “e0c9795a7fcf4ad2b7a257952dc5151ab1c865a02d88a41b7885b5f4e15b5879”. Some wallets utilize encrypted files that require a password for access, providing an additional layer of security. However, the most common approach involves generating mnemonic phrases consisting of 12-24 words using the BIP39 protocol. This method ensures that the private keys are easier to remember but difficult to guess. For example, “shampoo plane stingray gully mollusk anyway clarify observing echo bazooka heading replica”.

Interestingly, certain wallets, like the CoolWallet S hardware wallet, use numbers instead of words for their recovery seed. A checksum is then used to verify the accurate recording of the seed. This feature is particularly beneficial for non-English speakers as it helps prevent spelling errors that could result in the inability to access the wallet. For instance, confusing “plan” with “plane” could lead to a loss of access.

Regardless of the method employed for generation and storage, it is crucial to adequately safeguard private keys. Users are strongly advised to store them offline rather than on an online device. One option is to write them down on paper and keep them in safes or deposit boxes. Another common practice is to utilize hardware wallets, which allow for offline storage. Additionally, there is a niche group of users who opt for specially designed holders made of fire-resistant materials like titanium to protect their private keys.