BIP39 wallet
Bitcoin Improvement Suggestions or BIPs are design features, input, ideas, information or changes fundamental to how Bitcoin works (including storage, i.e. wallets).
One of these features is BIP39 (short for Bitcoin Improvement Suggestion: 39). BIP39 is a proposed standard to use a mnemonic phrase – a group of easy-to-remember words – that acts as a backup to recover your wallet and coins in case your wallet is lost or destroyed. This is also known as a seed phrase, recovery phrase, wallet backup, etc.
Your wallet generates this phrase for you when you create a new wallet. If you have an existing phrase, you can type it into your wallet to regenerate your wallet.
Typically, when you start a new wallet, the instructions will ask you to write down a 12-24 word sentence that will serve as a recovery method should your wallet break or stop working.
Other considerations
Also, when storing your coins, you should write down the BIP standards that your wallet supports. These standards are called derivation paths and are a “map” that tells your wallet where to find your coins. They are described in BIP44, BIP49 and BIP84.
You should also write down what type of coin you have saved (Bitcoin, Ethereum, etc.)
This information will help you recover your coins if the wallet you originally used ever becomes obsolete and you need to use another wallet developer’s software.
Your 12-24 Phrase can be entered into any other wallet using the same structure/format standard (BIP39), derivation path and coin support to access your coins (by you or others). Note that it is possible for your coins to be on more than one wallet at the same time.
What makes a “good wallet” is one that has clear, easily accessible documentation on supported BIP standards, derivation paths, and recovery processes. This allows the user to successfully restore their funds to another wallet in case of discontinued support or obsolescence.
If you’re having trouble restoring your wallet, we recommend you refer to Common mistakes when restoring a seed phrase
BIP39 wallet list
Below is a list of some popular hardware and software wallets that not only use the BIP39 standard but provide adequate documentation in case of recovery.
Note: We do not explicitly or implicitly endorse or are endorsed by the listed wallets. If you would like your wallet to be added, removed or modified please contact us at in[email protected]. Please include a link to your documentation.
BIP39: Mnemonic code for generating deterministic keys
Bitcoin Iimprovement Papplications (GDP). BIPs are documentation for features, ideas, information, changes, improvements, etc. about how Bitcoin works.
Each of these BIPs is denoted by a number.
GDP39 or Bitcoin Improvement Proposal: 39 is one of the many design ideas that was approved by an economic majority of the Bitcoin community and became the standard for many popular wallets.
Again, BIP39 is the use of a mnemonic phrase – a group of easy-to-remember words – that acts as a backup to recover your wallet and coins in the event your wallet is compromised, lost, or destroyed.
The BIP39 documentation describes the specific steps a wallet (i.e. algorithm) must take to generate this mnemonic phrase. This includes specific requirements, structures, practices, words, etc.
In addition to its specific structure, it must use a specific list of words when generating your mnemonic phrase. This is known as the BIP39 word list.
BIP39 word list
The words in your mnemonic are not random words. They are drawn from a specific list of 2048 words known as the BIP39 word list. At launch, wallets using the BIP39 standard will provide you with a 12-24 word phrase randomly selected from the standard BIP39 word list.
In this list are the first 4 letters unique to every word.
To clarify “unique” we literally mean the first 4 letters (not the first 4 different letters). For example, the word “apple”, “appl” does not appear anywhere else in the BIP39 word list.
For words with only 3 letters, there is no 4th letter. For example, with the word “add” there are no more letters after that and therefore the word “add” must be there. The word “addict” is in the BIP39 word list, but you would have used “addi” for “addict”.
In other words, there is not two words in this list with the same first 4 characters.
That is, if you have the first 4 letters, you know the rest of the word by searching for those first 4 letters in the BIP39 word list. Some wallets even fill in the rest of the word once the first 4 letters are typed.
BIP39 wallet recovery
Remember your coins are not saved on your wallet device. They are stored on the blockchain (i.e. a universal network) and can be accessed using your seed phrase. Your wallet saves those “Access” to these coins, not the coins themselves.
If you are restoring an existing wallet, the wallet’s software will ask you if you have an existing phrase or if you have the option to import one. You enter your existing mnemonic seed phrase and voila, your coins are restored… right?
Well, actually it’s not that easy (but it should be!). Let’s go into the background why that is.
BIP39 is Not enough to recover your coins
Unfortunately, having a wallet that supports BIP39 mnemonic phrases doesn’t mean it can recover your coins. It is only a part the requirement.
GDP39 is like the ability to “read” and understand the seed phrase. But your wallet also needs to understand how to “find” your coins with that 12-24 word phrase and “know” the coin you are trying to find.
You need to know about a compatible wallet when importing an existing seed phrase:
- If it supports the structure in which the seed phrase was originally created (i.e. seed format, e.g. BIP39)
- The derivation paths it supports (i.e. the ability to find your coins)
- The supported coins (e.g. Bitcoin, Ethereum, etc.)
To understand what we mean by this, let’s first examine what a “wallet” actually is.
Hierarchical deterministic purses
Your wallet is essentially a whole string of numbers (which can “store” coins) linked together starting from a single random number.
This random number can be converted (with math) into another number. This number can be converted into several other numbers (and so on and so forth)
Eventually, at the end of these transformations, you arrive at a series of numbers. These numbers can be associated with coins (by sending coins to these numbers). Correct, these numbers are your addresses.
You can think of a wallet as a tree (like a real one in the ground)
Your seed phrase is the secret recipe for creating very specific seeds for a very specific tree.
BIP 39 is the “language” the recipe is in (so it can be read).
From the seed comes a stem. From this trunk there are branches. Each branch has a name (branch 1, branch 2, branch 3, etc.).
These branches also have branches (Branch 1-1, Branch 1-2, etc.) and the branches of these branches also have branches (and so on).
And at the very end of all those branches are leaves. yeahYour coins can be “stored” on these sheets (your addresses).
It can get pretty confusing, right? To the right.
derivation paths
You need some kind of “map” to traverse the branches and find those leaves (and therefore your coins). This “card” is referred to as a derivation path.
derivation paths Tell your wallet how to find your coins by guiding them through the tree and are described in Bitcoin Improvement Proposals (BIP).
The most common derivation paths are described in BIP44, BIP49 and BIP84.
A The derivation path has a specific notation where each level is denoted by a “https://www.blockplate.com/” beginning with M:
m / purpose’ / coin type’ / account’ / change / address
Purpose, coin type, account, change and address are represented by numbers and explained here.
Your wallet must support the same derivation path that you used (i.e. “have the card”). to store your coins.
Whether a wallet supports a specific derivation path should be well documented or referenced on their website.
If another wallet doesn’t support a derivation path that your original wallet supports, it doesn’t mean your coins are lost. It just means you can’t access it (because it doesn’t know how to find it!).
A more detailed explanation of derivation paths can be found here: What is a derivation path
coin support
You may have noticed that not all wallets support all coins.
Not only does your wallet need to know how to find your coins, it also needs to support the coin you are trying to find.
Coin types are the cryptocurrencies (e.g. Bitcoin, Ethereum, etc.)
Coin support should be well documented or referenced on the wallet developer’s website. Again, if a wallet supports a particular coin, it doesn’t mean it’s lost. You’ll need to find another wallet that does this in order to access it again.
Additional standards
There are other standards like:
- Lighting Network Daemon (AEZeed): When using the Lightning Network Daemon wallet, it uses a different seed scheme known as AEZeed.
- electrum: If you use the Electrum wallet, it also uses a unique seed scheme.
- Improvement Suggestion by Satoshi Labs (SLIP 39): If you use Trezor’s parent company, Satoshi Labs, Shamir Secret Shares’ unique seed standard, SLIP 39.
For these unique standards, they can only be restored on wallets that support this standard. If your wallet doesn’t “understand” how your seed phrase was created, it won’t understand how to recover it either.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.