What Is the Safest Way to Store Cryptocurrency Long-Term?
Digital assets such as cryptocurrencies are revolutionising finance, but they also require a high level of security. Improper storage of cryptocurrencies can lead to loss of funds due to hacking attacks, hardware failures or human error.
- In this article, we’ll explore the most secure methods for long-term cryptocurrency storage, including hardware and software wallets, multisig solutions, and advanced strategies like Shamir Backup.
What is seed phrase and why is important?
A seed phrase (or recovery phrase) is a 12 to 24 word phrase that allows for the recovery of a cryptocurrency wallet in the event of a lost device. If someone gets hold of your seed phrase, they can gain access to your funds.
The most common mistakes when storing seed phrase:
❌ Saving in digital form (e.g. screenshot on your phone)
❌ Sharing with someone else
❌ Paper-only storage with no backup
✔ Recommended solution: Use a steel plate (Steel Wallet from Shadowb.io) or Shamir Backup to split the seed phrase between multple locations.
Hot storage vs. Cold storage: whitch is safer?
| Feature | Hot storage (Software/mobile wallet) | Cold storage (Hardware wallet/specialized device) |
|---|---|---|
| Accessibility | Instant acces | Requires physical device |
| Security | High risk of hacking | Low risk of hacking |
| Risk of loss | Low(cloud backups) | High(backup required) |
| Long-term storage | ❌ Not recommended | ✅ Best choice |
The most secure way to store cryptocurrencies for the long term is Cold storage – for example, a Trezor or Ledger hardware wallet.
Hardware wallets: which is the best?
| Peněženka | Seed phrase (12/24 slov) | Podpora passphrase | Shamir Backup | Hodnocení bezpečnosti |
|---|
| Trezor Model 5 | ✅ Yes | ✅ Yes | ✅ Yes | ⭐⭐⭐⭐⭐ |
| Ledger Nano X | ✅ Yes | ✅ Yes | ❌ No | ⭐⭐⭐⭐ |
| Coldcard Mk4 | ✅ Yes | ✅ Yes | ❌ No | ⭐⭐⭐⭐ |
Passphrase: additional protection against theft
Passphrase is an optional password that is added to the seed phrase. If you use it, even if someone gets your seed phrase, they still can’t get to your cryptocurrency.
Tip_1: Never store your passport online or digitally. Store it safely offline and ensure it does not disappear.
Tip_2: The biggest threat to your cryptocurrencies on hardware wallets is not hackers, but the user themselves. If you forget or lose your passphrase, access to your funds is gone forever.
Shamir Backup: the safest way to backup seed phrase
What is Shamir Backup? (SLIP 39)
Shamir Backup allows you to split a seed phrase into multiple parts, of which a certain amount is needed for recovery.
| Number of parts | Minimum number for recovery | Security level |
|---|---|---|
| 3 | 2 | Medium |
| 5 | 3 | High |
| 7 | 5 | Highest |
You can think of this type of security as a classic 24-word seed, but longer and more secure. To recover the wallet, you need a minimum number of correct parts – for example, if you split it into 3 parts, you need 2 of them, each containing 35 words.
How to safely store seed phrase?
🔒 Physical storage:
✔ Use a steel plate (e.g. Shadowb.io)
✔ Put it in a safe deposit box, bank box, brick it up or bury it in the garden – in short, wherever you think it’s safe.
🛑 Don’t do:
❌ Storage in the cloud or email or on your mobile phone
❌ Write on paper without backup
FAQ: frequently asked questions
-> What should I do if I lose my seed phrase?
Cryptocurrencies cannot be recovered without a seed phrase. Therefore, it is important to back it up properly.
-> Can the seed phrase be hacked?
Not if it is stored correctly. Never store it online.
-> What are the best hardware wallets?
We recommend the Czech Trezor for the best security.
-> Where to store the passphrase?
Preferably on a steel plate (e.g. Shadowb.io) or in an offline safe.
-> What happens if someone steals my Trezor/hardware wallet?
What happens if someone steals mine Without knowing the passcode and passphrase, an attacker can’t access the funds.
Conclusion and recommendations
✔ For long term storage of cryptocurrencies we recommend Hardware wallets
✔ Use Shamir Backup for secure seed phrase backup.
✔ Protect the seed phrase using the Shadowb.io steel plate.
✔ Never store seed phrase or passphrase online!
💡 Want to make sure your cryptocurrencies are safe? Invest in quality hardware wallets and secure backup methods.
