A passphrase (sometimes called the "25th word") is an additional user-chosen string added to your seed phrase during key derivation. It creates an entirely separate set of wallets from the same 24 words, effectively a hidden wallet that only exists when the correct passphrase is entered. Without the passphrase, the hidden wallet is invisible and inaccessible.
What Is a Passphrase (25th Word) on a Hardware Wallet?
3 min read
The short version
Your 24-word seed opens one set of accounts. Adding a passphrase is like having a secret second door behind a bookcase, the same building (seed phrase) leads to completely different rooms depending on whether you say the password. Someone who steals your 24 words without knowing the passphrase will only see the standard accounts, not the hidden ones.
How It Works
In BIP-39, the seed derivation function takes two inputs: the mnemonic (your 24 words) and a passphrase (empty string by default). PBKDF2(mnemonic, "mnemonic" + passphrase, 2048 rounds, SHA-512) produces the 512-bit seed. Different passphrases produce entirely different seeds, and therefore different master keys and address sets. There is no "wrong" passphrase, every passphrase generates a valid wallet. If you enter the wrong passphrase, you get an empty wallet, not an error message. This means: (1) Plausible deniability, you can keep decoy funds in the no-passphrase wallet and real holdings in the passphrase wallet. (2) No brute-force feedback, an attacker cannot tell if they guessed correctly unless they know which addresses to look for.
Setting up plausible deniability with a passphrase
Your 24-word seed with no passphrase shows a wallet with 0.1 BTC (decoy). You set up a passphrase "correct horse battery staple" on your Ledger. This generates a completely different Bitcoin wallet where you hold 3 BTC (your real savings). If coerced to reveal your seed phrase, you give the 24 words. The attacker sees 0.1 BTC and may assume that is everything. Your 3 BTC remains hidden, it only appears when the specific passphrase is entered. You keep the passphrase memorized or stored in a separate physical location from the seed phrase.
What People Get Wrong
The passphrase must be a single word
It can be any string, a word, a sentence, numbers, symbols. The term "25th word" is misleading. It is not limited to BIP-39 word list words and can be any length.
The wallet will tell you if you enter the wrong passphrase
It will not. Every passphrase generates a valid but different wallet. If you forget or mistype your passphrase, you access an empty wallet with no indication that you are wrong. There is no recovery mechanism, a forgotten passphrase means lost funds.
A passphrase is the same as the wallet PIN
Completely different things. The PIN protects physical access to the device. The passphrase changes which keys are derived from the seed. You can have the correct PIN but wrong passphrase and access the wrong wallet.
Keep Reading
Sources & Further Reading
- BIP-39 Passphrase Section
The part of the BIP-39 spec that defines how passphrases modify key derivation
Questions People Also Ask
- What happens if I forget my passphrase?
- Your funds in the passphrase wallet are permanently lost. There is no recovery. That is why many security experts recommend: if you use a passphrase, store it in a separate secure location from your seed phrase, but never in a way that can be completely lost.
- Do all hardware wallets support passphrases?
- All major hardware wallets (Ledger, Trezor, Coldcard, BitBox02) support BIP-39 passphrases. The feature is usually found in advanced settings during wallet setup or as a "hidden wallet" option.
- Is a passphrase really necessary?
- For most users, a well-secured seed phrase + hardware wallet is sufficient. Passphrases add value for: high-value holdings, threat models involving physical coercion, or situations where you want plausible deniability. They add complexity and a new failure mode (forgetting it), so weigh the tradeoff.