A device physically isolated from the internet and all wireless networks. Data transfer only via QR codes, MicroSD cards, or NFC. Eliminates remote attacks on private keys.
BIP-39
Standard for generating mnemonic phrases (seed phrases) from a dictionary of 2,048 words. Defines how 12 or 24 words encode a wallet’s private key. Supported by virtually all wallets.
Brute force
An attack method that tries every possible password or key combination. The longer and more complex the password, the exponentially more time is required.
Cold storage
Storing cryptocurrency keys on a device that has never been connected to the internet. Hardware wallets, paper wallets, and metal backups are forms of cold storage.
Duress PIN
A special PIN code for use under coercion. When entered, it opens a decoy wallet with a small balance instead of the main one. Allows you to hand over ‘everything’ to an attacker while preserving real funds.
Entropy
A measure of randomness and unpredictability. Measured in bits. 128 bits of entropy (12 BIP-39 words) = 2^128 possible combinations. 256 bits (24 words) is practically impossible to brute-force.
Multisig (multi-signature)
A scheme requiring signatures from multiple keys to authorize a transaction (e.g., 2 of 3). Implemented at the blockchain level, unlike Shamir which operates at the seed phrase level.
One-Time Pad (OTP)
The only mathematically proven unbreakable cipher. The key must be random, the same length as the message, and used only once. XOR encryption of a seed phrase with a random key implements OTP.
Open Source
Software with publicly available source code. Anyone can audit it for vulnerabilities and backdoors. For hardware wallets this is critical: closed source requires trusting the manufacturer.
OSF (Open Seed Form)
A SeedShift term. The open form of a seed phrase — the result of transforming PSF using a Passphrase. Looks like a normal seed but leads to an empty wallet. Can be stored openly.
Passphrase (25th word)
An additional password for a seed phrase per the BIP-39 standard. Each passphrase creates a completely separate wallet. Without the passphrase, even knowing all 24 words won’t grant access to funds.
PSF (Private Seed Form)
A SeedShift term. The private (real) seed phrase that grants access to the wallet. PSF is transformed into OSF for safe storage.
Secure Element (SE)
A specialized chip for storing cryptographic keys. Protected against physical data extraction. Used in bank cards, passports, and hardware wallets. Certification: CC EAL5+/EAL6+.
Seed phrase (mnemonic phrase)
A set of 12 or 24 words that serves as a backup of a cryptocurrency wallet. Generated per the BIP-39 standard. Knowing the seed phrase = full access to all wallet funds.
Shamir Secret Sharing (SSS)
A cryptographic algorithm for splitting a secret into N parts, where any K parts are needed for recovery (K-of-N). Each individual part contains no information about the secret. Standardized as SLIP-39.
SLIP-39
Standard implementation of Shamir Secret Sharing for seed phrases. Defines the format of shares, splitting schemes, and recovery procedures. Supported by Trezor and Keystone.
XOR (exclusive OR)
A bitwise operation: 0⊕0=0, 0⊕1=1, 1⊕0=1, 1⊕1=0. Used for encrypting seed phrases: each word index is XORed with a key. With a random key, it implements a One-Time Pad.
