1. Length of the security phrase
• 12 words (128-bit entropy):
• Provides 128-bit entropy, corresponding to 2^{128} combinations (~3.4 \times 10^{38}).
• Popular among users because it is easy to remember and sufficiently safe for current cryptocurrency transactions.
• 24 words (256-bit entropy):
• Provides 256-bit entropy, corresponding to 2^{256} combinations (~1.1 \times 10^{77}).
• Significantly higher security, suitable for storing large or long-term assets.
2. Security level
• 12 words (128-bit):
• Currently still safe enough with existing technologies.
• However, it may be threatened in the future as quantum computers develop.
• 24 words (256-bit):
• Provides a higher layer of security, better resistance against future attacks, including quantum computers.
3. Convenience
• 12 words:
• Easy to remember and manage, especially for new users.
• 24 words:
• Harder to remember but safer, especially if you are storing significant assets.
Which Type Should Be Used for Cold Wallets?
• 12 words (128-bit):
• Suitable if you store small assets or use a cold wallet for regular transactions.
• Safe for most current users.
• 24 words (256-bit):
• Should be used if you are storing large amounts of assets or intend to hold long-term.
• An ideal choice for maximum security, especially if you are concerned about future technological threats.
Is 128-bit vulnerable?
• Currently: Not easily bypassed
• With 2^{128} combinations, even the most powerful supercomputer today would take billions of years to brute-force the key.
• Therefore, a 12-word seed phrase with 128-bit entropy is still very safe in the current situation.
• The future: There are risks with quantum computers
• Quantum computers using Grover's algorithm can reduce search time from 2^{128} to 2^{64}.
• However, this requires 20-30 years of quantum technology development.
Is there a 512-bit type?
• 512-bit entropy exists but is rarely used in practice. This is a much higher security level, but unnecessary for most current applications.
• SHA-512: Some hashing algorithms, like SHA-512, use 512-bit for encoding, but for seed phrases, 512-bit is unnecessary as 256-bit already far exceeds current security requirements.
In summary:
1. 12 words (128-bit entropy):
• Suitable for ordinary users, small transactions, or no long-term storage needs.
2. 24 words (256-bit entropy):
• Ideal for large assets, long-term storage, and protection against future technological threats.
3. 512-bit entropy:
• Not necessary in cryptocurrency wallet applications as 256-bit fully meets the security needs.
If you store a large amount of cryptocurrency or have long-term plans, 24 words (256-bit) is the optimal choice. If it's just small transactions, the 12-word seed phrase still ensures current safety.
