The loss of a phone can be stressful, particularly if it includes access to a cryptocurrency wallet. However, the positive side of it is that the loss of your device doesn't necessarily mean the loss of your crypto. If you have a self-custodial wallet, then your digital assets aren't stored on your phone, they're still on the blockchain. If you have lost your recovery phrase you can regain access to your wallet on a new device.
In this guide, we outline the safe measures you should take when recovering your self-custody wallet, what to do if you have lost or stolen your phone, and how you can protect your funds during recovery.
What Happens When You Lose Your Phone?
Many people feel that their cryptocurrency is stolen in case their phone loses. Luckily that is not the case with self-custody wallets.
Your phone simply provides access to your wallet. The real cryptocurrency is registered on the blockchain. There are private keys required to manage those assets that are stored in your wallet application.
If one of your phones is lost, stolen, or replaced, you can recover access to your wallet by downloading your wallet to another compatible device and using your recovery phrase to restore your wallet.
If an individual accesses your unlocked phone and your wallet isn't safeguarded with a PIN or biometric authentication, however, they could try to gain access to your assets. So, it's crucial to act promptly.
Step 1: Stay Calm and Assess the Situation
When making a decision, ask yourself these questions about your phone:
- Lost temporarily
- Stolen
- Damaged beyond repair
If you think the phone is stolen, consider it as a security threat. The faster the sooner the better.
Lock or Erase if services with remote device management are used, lock or erase as soon as possible.
Step 2: Get a New Trusted Device
Recover your wallet only on a device that you trust.
Prior to installing your wallet:
- 1. Update the computer operating system.
- 2. Ensure that you have the most recent security updates installed.
- 3. Do not share or use shared equipment.
- 4. Secure Internet: Use a safe connection.
A fresh and clean device means fewer unwanted security issues.
Step 3: Install the Official wallet App
Only install your wallet from the official website or a trusted app store.
One of the most popular ways scammers try to obtain recovery phrases is by creating fake wallet applications. Make sure you always check the publisher before installing any application.
Do not download the wallet from links provided in mails, social media or messengers unless from the official link.
Step 4: Recover Wallet With Your Recovery Phrase
When creating a wallet, choose to restore an existing wallet.
Please type in your recovery phrase exactly as it was written, when the wallet was initially created. The words must be entered in the correct order.
Once verified, your wallet will re-establish the connection to the blockchain, and you will see your balances and transaction history.
Be aware, do not enter your recovery phrase into any app other than your official wallet app. Do not share it with someone else, nor type it in an unfamiliar website.
Step 5: Put Your Wallet Back in Place
Once your wallet has been restored, take a few minutes to improve its security.
Enable:
- A strong PIN
- If available, biometric authentication to be used.
- Automatic device locking
- The newest wallet versions
If you think that someone may have the key to accessing your lost phone, you can also move your money to a new wallet that has a new recovery phrase to ensure that you still have the funds in your new wallet, even if it is recovered.
What If You Don't Have Your Recovery Phrase?
The Mnemonic phrase is the backup to access your wallet.
You might not be able to recover your wallet if your phone is lost and you don't have the recovery phrase.
It is, therefore, crucial that the recovery phrase be written down and kept off the network properly when creating a wallet for every wallet user who chooses self-custody for his wallet.
It's best not to save it in cloud storage, email, or screenshots, because it heightens the risk of it being stolen.
The steps needed to avoid issues going forward
When we are prepared, it is easier to recover a wallet!
Good habits include:
- Keeping the recovery phrase in a secure separate location.
- Having several secure copies.
- Secure wallet with a strong PIN number.
- Regularly updating wallet software.
- Installing wallet apps through trusted sources and channels.
In this way, you can limit the risk of losing access to your crypto in the future.
To reinforce the protection of your wallet across the board, our post on crypto wallet security provides a down-to-earth guide on the practices every crypto person ought to take.
Some common recovery mistakes to avoid:
There are a number of security issues that users may encounter during the recovery process.
Here are some mistakes that should be avoided:
- Typing the recovery phrase in a bogus website.
- Downloading unofficial wallet applications.
- Give out recovery information to an alleged "supporter.
- Not updating the software prior to wallet restore.
- Hurrying in the recovery and not checking every step.
By studying the security pitfalls of common crypto wallet mistakes, you can stay away from these pitfalls and retrieve your wallet securely.
Frequently Asked Questions
What is the risk of theft of my phone causing me to lose my crypto?
No. Your crypto assets are safe on the blockchain. If the recovery phrase exists, it is possible to recover your wallet on another trusted device.
Can anybody get access to my wallet without my phone?
When the phone is protected by a pin, password or biometric authentication, your wallet is much harder to access. There are extra security measures in the wallets to ensure it goes even further.
What is the recovery time of the wallet?
Once you've downloaded the official wallet app and verified with the correct “recovery phrase”, restoring a wallet typically requires just a few minutes.
Conclusion
Don't fear the loss of your phone, it doesn't mean you have to lose your cryptocurrency. A self custody wallet is created to provide us the control over our assets so long as we take care of our recovery word and adopt good security measures.
We can safely regain access to our wallet in a timely fashion, restore it on a trusted device, and re-authenticate it with robust security, ensuring we can control our crypto confidently and safely. The best protection is making a backup and keeping your recovery phrase safe is the most important step of all.
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