Private Key and Seed Phrase – What’s the Difference?

Henrique Centieiro· 6 min read

“Not your keys, not your coins.” I’m sure you’ve heard this well-known saying, especially during this uncertain time in the crypto space, with big exchanges going bankrupt one after another. It’s exciting to see the awareness of self-custody has been rising significantly lately. Check my previous article on why you should consider getting a cold wallet.

However, I noticed something interesting. While I see the above saying everywhere, it seems a lot of people mistook ‘keys/ private keys’ for ‘seed phrases/ recovery phrases.’ If you are one of them, don’t worry! Let’s demystify this common misconception right now!

First thing first, do you know there are 2 types of keys in our crypto wallet?

Public keys (Wallet Address):It serves the same purpose as your bank account number, essentially, it’s the receiving address of your wallet. Anyone can send crypto by using this public key to your wallet (hence it’s called public) without putting the security of your wallet at risk.

Public keys usually look something like this:


Private keys:It is the password to access your bank account. If anyone holds the private key of a crypto wallet, it means he/she has total control of that crypto wallet. Private keys serve the purpose of identifying the ownership of your wallet, so if you lose the private key, you lose access to your wallet. And if your private key is compromised or got stolen, then someone has control over the assets in your wallet; he/she can transfer them to another wallet as they please.

The private keys have a form of hexadecimal (hex) number, combined with long strings of numbers and characters, which is essentially a specific way of presenting very large numbers. These hex numbers can be recognized by computers easily while still manageable by humans.

Private keys usually look something like this:


How do these keys work?

Every time we create a new wallet, it comes with a public key and a private key. The public key is the address to your wallet (in same cases, the address derives from the public key too). The private key is used for signing transactions.

Nowadays, if you use a simple wallet with just one address, you probably will only have the private key as an access key.

An example of such a simple wallet that only holds one type of cryptocurrency (hence with only one address) is a Bitcoin wallet. If you go to, you can generate a new Bitcoin wallet address, and after you follow the procedure to add some randomness (like moving your mouse around or typing some random characters), you will then be given both your public key (wallet address), and private key after the address is successfully generated. This is a great way to visualize how public keys and private keys are generated.

Follow the instructions to generate a new Bitcoin address:

As suggested on the site, you have the full responsibility to keep the private key safe, as anyone who has access to your private key can have access to your wallet:

But how about Seed Phrases?

If you are using a wallet that can store multiple addresses (and multiple cryptocurrencies), for example, a hot wallet like Metamask or a cold wallet like Ledger Nano, you don’t usually see the private key of your wallet.

Instead, a “seed phrase” or “recovery phrase” is generated from the master private key of your wallet, which usually has a form of a mnemonic phrase, which is a combination of a set of words (usually 12 or 24 words), and it’s given to you when you create your wallet. It can also be called “BIP39 mnemonic sentence”, which is to tackle the problem of errors that might occur while trying to use the private key, which combines long strings of unfamiliar characters. We will talk a bit more about the “BIP39 mnemonic sentence” later.

Seed phrase/ recovery phrase usually looks something like this:

crazy magnet guilt tobacco cousin fire purity depend muscle strong suspect rich

This kind of multiple-addresses wallet acts as a master wallet of all the cryptocurrency addresses you have inside. The wallet itself will generate and store the private keys for each cryptocurrency address, so it saves you some hassle of having to write down all of the private keys. Instead, what you need to write down is only the one master access key, which is the seed phrase (recovery phrase).

How is the seed phrase being generated?

It is done through a series of complex processes, including hashing, salting and checksum; a binary “seed” is then generated, which is used to recover and have access to your wallet. This series of processes is called “BIP39 mnemonic sentence”.

As mentioned earlier, to avoid the errors that may be potentially created by using the private keys, which are composed of long strings of unfamiliar characters, Bitcoin enthusiasts have come together and developed a unique way to create the seed phrases from a word list of 2,048 words. These 2,048 words are carefully chosen with no similar words to cause any potential errors, and each of the words can be identified by just the first 4 letters.

These 2,048 words can generate a huge amount of possible combinations (in fact, 2048¹² = 2¹³²), which guarantees the same strict level of 256-bit encryption standard, same as other features of Bitcoin and blockchain.

You can check out this BIP39 mnemonic code convertor and generate a new mnemonic code for fun:

What happened after I entered the seed phrase?

After you enter the seed phrase to recover your wallet, through a special algorithm, a master private key, as well as the public key (the public key or address is also a hash of the private key), can then be generated from the phrase, which is essentially what a wallet is combined of (public key + private key).

Not only that, it can calculate all of the corresponding public and private keys for every supported cryptocurrency or token from your seed phrase. Why the name ‘seed’ phrase? Seed phrases can be used by the wallet to ‘sprout’ (aka create) all other public keys (wallet addresses) and other information. Just from this one seed phrase, your wallet can create a set of hundreds of public and private keys.

That’s why this seed phrase (recovery phrase) is very important, and you need to make sure they’re not shared with anyone as basically the same as a private key; anyone who has access to it can have access to your wallet.

I hope it’s all clear by now…

By now, you understand even though both private keys and seed phrases serve the same purpose, which is to grant you access to a wallet, they are not technically the same thing and are created differently. However, it’s very important to keep them both very safe and secure. In the upcoming article, we will explore some interesting options to keep your seed phrases secure other than just writing them down on a piece of paper. Stay tuned!

Here’s a special shoutout to Ms. Bee Lee, for her crucial effort that contributed to creating this article.

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