How to think about encrypting your records
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
Encryption is what keeps a record unreadable if it ends up in someone else's hands. But the strength of it comes down to the passphrase and where you keep a copy of that passphrase. This page covers the general thinking only; for software settings, read the product's own documentation.
Key points
- In practice, the passphrase is what determines the strength
- Lose the passphrase and the contents are gone for you too
- Keep the encrypted file and the means of opening it in different places
- Do not treat an encrypted file as the place for a seed phrase
Definition
Converting a records file into a form only someone with the passphrase can read, so that losing it does not mean exposing it.
Start from what happens if the file reaches someone else. A leaked CSV of trade history does not let anyone take anything, but it does show what you hold, which can make you a target. A wallet inventory says more still. If files like these are going onto external storage or into the cloud, encrypting them is worth the trouble.
In practice the passphrase, not the algorithm, sets the strength. With any widely used scheme, brute force is not a realistic attack. A short passphrase, or one reused from another service, is. Length and uniqueness are effectively the whole of it.
Encryption carries the mirror-image risk: forget the passphrase and you can never read the file again either. When encrypting something you will need in several years, ask whether that future version of you will remember. If you keep a written copy, keep it somewhere other than with the encrypted file, ideally offline. A text file with the passphrase on the same USB stick undoes the entire exercise.
On keys: the thought that a seed phrase could be encrypted and then stored in the cloud is a natural one, and we do not recommend it. A compromised cloud account, a reused passphrase, a sync bug, or simply being unable to open the file years later — and with keys, a failure cannot be undone. Keys belong on offline media, under different rules from encrypted files.
This page names no products and gives no settings. Recommended configurations differ by tool and change over time. Before adopting one, read its official documentation and check that it is still actively maintained.
Watch out for
- · Lose the passphrase and you cannot recover the file either
- · We do not recommend encrypting a seed phrase and storing it in the cloud
- · For actual settings, always follow the product's own official documentation
Frequently asked questions
How am I supposed to remember the passphrase?
A long combination of words you do not use elsewhere balances memorability against strength. If you write it down, store it somewhere other than with the encrypted file.