The next step involves entering a passphrase. This prevents you from getting your funds stolen if someone gets access to your device and its PIN or to your 24-word backup. Before doing this step, please read below to know some important basics.
- It acts as a password that you add on top of your wallet backup (24-word seed phrase).
- You can create as many passphrase-protected wallets as you like, with each new passphrase generating a completely new wallet.
- The default wallet does not have a passphrase, adding one gives you plausible deniability, meaning that you can unlock the device normally containing no to little funds, with the majority of your bitcoin in a passphrase-protected wallet.
- If someone comes into contact with your 24-word seed or digital backup, they won’t be able to steal your funds since they also need the passphrase to unlock the funds.
- Write down the passphrase you want to use before entering it in your computer.
- The passphrase is required every time you want to spend the funds from your Coldcard.
- Use a combination of words as a passphrase to have less trouble remembering it.
- Use at least 12 characters in your passphrase, 24 characters offer more security.
- If someone has access to your PIN and Coldcard, the passphrase will prevent them from taking your Bitcoin.
- Create a unique passphrase that nobody can guess but that you can remember.
- If you lose the passphrase, you lose access to your Bitcoin forever.
- You cannot change your passphrase.
- You can only create a new one, which in turn will generate a new wallet.
- The passphrase is required to recover your access to your Bitcoin if your Coldcard is damaged, lost or stolen.