We’ve got a Special Edition, SD! For the next few issues, rockstar community member 0xJeff will be writing for ETH SD. Let’s dive in!

Bitcoin and Ethereum adoption has increased in the past 3 years, especially as NFTs brought a new group - creatives - into the space. While creatives have added a great deal of value to crypto, they are often less technical users. The result has been painful, as many NFTs have been stolen from users who never understood the importance of on-chain security.

For my first Weekly GM article, I'd like to help explain the three pillars of account security, making it easy enough for most people to set up their crypto wallets. For many of you, this will be a review of what you already know. If, however, you can't define the terms "seed phrase" or "private key", or if you've never purchased a cold storage wallet, you should continue reading, and ask questions in the ETH SD Discord or Telegram Group (DM for access - you must add value).

The three pillars of account security are the seed phrase, the private key, and a physical cold storage wallet. These are the pillars of the castle that holds your digital assets, and can be used for Bitcoin, Ethereum, and any other digital asset token.

Let's break down each one to better understand what it does.

Seed phrase: the seed phrase is essentially a very long, clever password. Most of us have generated passwords for websites, and been told to use something like "2 upper case letters, 2 lower case letters, 2 numbers, 2 special characters" and don't write it down, or we forget it. However, even a 20 character password matching these conditions is not nearly as secure as a 24 word seed phrase.

The seed phrase must be kept secret, and safe. If it is revealed, anyone who sees them can steal all the crypto you've stored with them (including accounts derived from the seed phrase). These words should never be near a camera, never saved on a PC, and only handwritten and secured in a safe location. Treat your seed phrase like you would treat a stack of hundred-dollar bills. The only recourse if your seed phrase is revealed to others is to try and move your tokens to a new address, derived from a completely different seed phrase before the attacker does.

Splitting the words into a few groups of 6, or 8, can be a useful way to ensure they don't remain in one place (theft) and ensure continuity in case of death or incapacitation. Consider an attorney to hold some or maybe a trusted family member. Never, under any circumstances, give the entire seed phrase to someone you don't trust with the full amount of tokens you hold in your account.

For more information on seed phrases, you can watch Andreas Antonopolous do a deep dive on them.

Private Key: the private key is a series of letters and numbers, ranging from 0 to f (0, 1, 2, 3, 4, 5, 6, 7, 8, 9, a, b, c, d, e, f), that allow you to move tokens on chain. When a seed phrase is entered into a cold storage wallet, it uses those words to automatically generate the private key (which will be the same, regardless of the device, any time the exact 24 words are used).

The private key, unlike the seed phrase, is not human readable. It looks like a random string of letters (a - f) and numbers. This doesn't matter too much, however. While you will see your seed phrase words when you first set up your account, you might never see your private key string...and you never need to.

Treat your private key like you treat your seed phrase: it should never be near a camera, never saved on a PC. It will reside on your cold storage wallet after your seed phrase is typed in.

Can someone guess your private key? It's pretty unlikely. If you’re feeling lucky, check out keys.lol.

Cold storage wallet: this is the actual physical hardware device that you'll use to move your tokens. The most common are Ledger and Trezor. Both have strengths and weaknesses, but are the oldest and most reliable companies in the space.

There are a number of models for each of the products, but for about $60 the entry model is enough for most people. Each has simple to follow instructions that will walk a user through creating a seed phrase, backing it up (handwritten cards for seed phrases are provided in the packaging), and securing it with a PIN.

If, after reading this, you find yourself woefully insecure in your crypto holdings, and want to ensure you use the best technology to secure them, buying a Trezor or Ledger will give you all you need to apply the pillars we've covered today.

A cold storage wallet is MORE safe than the seed phrase or the private keys, because it is locked with a PIN that will erase the entire contents of the device if there are three wrong attempts. This means a thief who steals your device has at best a 3 in 10,000 chance of guessing your PIN.

Nevertheless, it is unwise to carry a cold storage wallet on your person unless there is a compelling need to do so. A thief can't guess your PIN, but they can use methods to convince you to tell them.

These are the basic pillars of owning your crypto safely. Review these, and again, ask questions in the ETH SD Discord.

We’ll keep you posted every Monday on what’s happening in the space. Follow @ETHSanDiego on Twitter or visit ethsd.org for info on events, educational content, and more!

See you next week,
@ChaseOnChain.eth & @gmchad.eth

Disclaimer: None of this is financial advice and is for educational purposes. Always do your own research.