Public Key, Private Key & Seed Phrase Explained

In crypto, control equals ownership, and that control comes down to three things: your public key, your private key, and your seed phrase. They’re the invisible trio that makes crypto wallets work, giving you the power to send, receive, and safeguard your digital assets.

But what exactly are they, and why do they matter so much? Let’s discuss each below.

What Is a Public Key?

Your public key is like your crypto address, the one you can safely share with others. It’s what people use to send you crypto, and it’s derived from your private key using cryptographic algorithms.

When you create a wallet, it automatically generates a key pair: one public, one private. From your public key, the wallet derives a shorter, more user-friendly version known as your wallet address (the string of numbers and letters you copy-paste when receiving tokens).

What Is a Private Key?

If your public key is your address, your private key is the key to your safe. It’s a unique alphanumeric code that proves you own the crypto in your wallet.

In crypto, whoever controls the private key controls the funds. That’s why non-custodial wallets like Velto never store or access your private keys. They’re encrypted locally on your device, so only you have the power to approve transactions.

Here’s what your private key does:

• It signs transactions, verifying that they came from you.
• It unlocks your assets, giving you full control of your coins and tokens.
• It authenticates your ownership, making it impossible for anyone else to move your funds without it.

Why Private Keys Must Stay Secret

Sharing your private key (even accidentally) is one of the worst things you can do in crypto. Once it’s out there, your funds can be gone, with neither password reset nor customer service recovery.

Never store your private key in cloud storage (i.e., Google Drive, iCloud, Dropbox, etc.). Don’t keep screenshots or photos on your phone, email drafts, text files, chat apps, or notes. Instead, write it down and keep it offline, or use a hardware backup if possible.

How Public and Private Keys Work Together

When someone sends you ETH, SOL, or another token, they use your public address. The transaction is then verified on the blockchain using cryptography (specifically, your private key) which proves that you’re the rightful owner of the funds being spent or received.

The public key acts as the lock, while the private key is the key that opens it. This is why they always come in pairs: one encrypts (public), and one decrypts (private).

And because of how asymmetric cryptography works, it’s mathematically impossible to derive a private key from its public counterpart. That’s what makes the blockchain secure, and what makes Velto’s Web3 wallet architecture both safe and convenient for everyday users.

What Is a Seed Phrase?

Your seed phrase (or mnemonic phrase) is a human-readable backup of your wallet, a list of 12, 18, or 24 words generated when you create a new wallet.

It’s basically your master key. From it, your wallet can regenerate both your private and public keys. That means if you lose your phone, uninstall the app, or switch devices, your seed phrase is the only way to recover access to your crypto.

When you set up Velto, you’ll notice the app asks you to back up your seed phrase and store it securely offline. That’s because no one (not even Velto) can restore your wallet without it.

The Role of the Seed Phrase in Wallet Recovery

Your seed phrase is the foundation of your wallet. It’s used to regenerate all your private and public keys in the exact same order every time. So, when you reinstall Velto or move to a new phone, all you need to do is enter your seed phrase, and your assets instantly reappear.

Without it, however, recovery is impossible. Unlike custodial wallets (where a third party can help you reset access), non-custodial wallets keep you in full control. It’s true ownership, but it comes with responsibility.

That’s why Velto emphasizes seed phrase safety during onboarding, making sure users understand that this single phrase is the ultimate backup to their Web3 identity.

How Web3 Wallets Generate Keys and Phrases

When you create a safe Web wallet with Velto (or any non-custodial wallet), it uses advanced cryptographic algorithms to generate your seed phrase and keys. Here’s how it works:

• A random number (entropy) is generated.
• That number is turned into your seed phrase.
• From that seed phrase, your private key is derived.
• From your private key, your public key and wallet address are created.
• It all happens locally on your device, meaning the data never leaves your hands.

Backing Up and Storing Seed Phrases Safely

Seed phrase security is non-negotiable, so be sure to follow these best practices:

• Write it down. Never type it. A written copy is immune to hacks or breaches.
• Use metal backups, especially if you hold large amounts of crypto. Paper can burn or fade; metal plates last decades.
• Keep multiple copies. Store them in different secure locations (like safes or safety deposit boxes).
• Never share it. No one legitimate will ever ask for your seed phrase. Not Velto, not support, not anyone.
• Stay alert to phishing scams. Fake airdrops, pop-up wallets, and malicious sites often trick users into entering their phrases. Always double-check URLs and never click suspicious links.

Final Thoughts

Your public key, private key, and seed phrase form the backbone of crypto ownership. They’re what make decentralization possible, empowering you to hold, send, and build in Web3 on your own terms.

And with a secure, intuitive wallet like Velto, managing them doesn’t have to feel complex.

FAQs

What is the difference between a public key and a private key?

A public key is your blockchain “address,” used to receive funds. A private key proves ownership and allows you to send them.

What is a seed phrase in a crypto wallet?

It’s a set of words that backs up your entire wallet and regenerates your keys if you ever need to restore access.

Can someone steal my crypto with my public key?

No. Your public key is safe to share. Only your private key or seed phrase can move funds.

Why is the seed phrase more important than the private key?

Because the seed phrase can recreate all private keys. It’s the ultimate backup for your wallet.

Do Web3 wallets store my private keys?

Non-custodial wallets like Velto never store them. Your keys stay encrypted on your device.

Are hardware wallets safer for storing keys and seed phrases?

Yes, they keep your private keys completely offline, making them resistant to hacks.