New Function “Encrypt Mnemonic Phrase Backup”

On April 29, CoinEx Wallet V2.0.2 was released with a new feature called Encrypt Mnemonic Phrase Backup. Since its launch, we have received a lot queries from our users, like “What’s this?/ What can I use it for?/ Do I still need to back up my mnemonic phrase after encrypting my mnemonic phrase backup? ”. To make it easier for you to better understand this new feature, let’s go through it in detail today.

 

History of Wallet Backup 

 

As we all know, the most important thing for a wallet is the private key, whoever has the private key will have full control of the wallet. 

 

But the private key is not that short, probably like this:

 

998dfc4e06c5f6a5927ca8996d53094f528948eadf3458ed12fb76ae3a532bfe

 

This makes the backup of the private key very troublesome, so we usually encrypt the private key to generate mnemonic phrase, which is generally composed of 12 to 24 words. Below is an example. 

 

① upgrade  ② loud ③ install ④ hair

⑤ project ⑥ math ⑦ fitness ⑧ spin

⑨ damage ⑩ silver ⑪ abandon  ⑫ acoustic

 

It seems that the backup of the mnemonic phrase is much simpler since you only need to write all the words down correctly in order. However, because the mnemonic phrase is regarded as the private key, if it’s hacked, your wallet will be in great danger.

 

To ensure your assets security, most wallet operators, including CoinEx Wallet, will not allow screenshots. Instead, they will suggest that you should back up mnemonic phrase on physical media, e.g. write it down on paper. It sounds simple but might be difficult for you in an emergency.

 

So, is there a more convenient wallet backup method?

 

Here, CoinEx Wallet wants to say YES. With the help of “Encrypt Mnemonic Phrase Backup”, you don’t have to rely on handwriting and screenshots any more. 

 

What is an encrypted mnemonic phrase backup?

 

Encrypted mnemonic phrase backup is the encryption of mnemonic phase. It consists of a mnemonic phrase password and a ciphertext QR code. You must use both of them together to import your wallet.

 

The mnemonic phrase password is a password of 8 to 32 characters set by yourself, which is used for secondary encryption of the mnemonic phrase.

 

The ciphertext QR code is generated by encrypting the mnemonic phrase with the above password. It looks like a normal QR code shown below. 

 

 

 

 

Note: CoinEx Wallet only provides the secondary encryption algorithm and saves the password hint set by the users. As a decentralized wallet, we do not save any key information related to the users’ accounts, such as the private keys, mnemonic phrases and security passwords.

 

 

Is encrypted mnemonic phrase backup safe?

 

Yes. 

 

Encrypted mnemonic phrase backup = ciphertext QR code + mnemonic phrase password

 

When using an encrypted mnemonic phrase to import your wallet, besides a ciphertext QR code, CoinEx Wallet will also require you to enter your mnemonic phrase password. If the hackers fail to obtain these two things in the meanwhile, that means they cannot get your wallet.

 

How can I properly encrypt my mnemonic phrase backup?

 

CoinEx Wallet advises you to save your mnemonic phrase password and ciphertext QR code separately. The mnemonic password is a self-set password composed of 8 to 32 characters. For security reasons, it is recommended to set a complex password containing uppercase and lowercase letters, numbers, and special characters. Anyway, it’s up to you.

 

Since the mnemonic phrase password is closely associated with the mnemonic phrase, CoinEx Wallet will not save your password, nor provide a password retrieval function. Therefore, please back up your mnemonic password and store it separately from the ciphertext QR code.

 

Do I still need to back up my mnemonic phrase after encrypting my mnemonic phrase backup?

 

CoinEx Wallet recommends you to back up your mnemonic phrase and encrypt your mnemonic phrase backup at the same time. In real life scenarios, most users’ assets loss are caused by their own negligence rather than hacking.

 

 

Although encrypted mnemonic phrase backup is safe, however, once you lose your ciphertext QR code or mnemonic phrase password, your assets will also be lost forever. In this case, you’d better back up your mnemonic phrase while encrypting your mnemonic phrase backup.  The encrypted backup can be applied for daily use and the mnemonic phrase is stored on physical media for backup. If you do not have enough time or are impossible to back them up in the mean time, you can encrypt your mnemonic phrase backup first, and then back up your mnemonic phrase.