Wallet security is an important consideration for users, as a compromised account may result in users losing control of their assets. Blockchain Wallet has several levels of security to protect user funds from any possible attacker, including the company itself.
Like other digital services, Blockchain Wallet accounts require passwords for the users’ protection. However, the Blockchain company does not store user passwords, and cannot reset the password if lost. This measure prevents company insiders from being able to steal cryptocurrencies. If a user forgets or loses their password, the account can only be recovered with a mnemonic seed.13
A mnemonic seed is a random string of English words that function similarly to a password. If a user loses access to their phone or device, the seed can be used to restore the wallet, including any cryptocurrencies. Like passwords, the Blockchain company does not store users’ mnemonic seeds. These seeds follow an industry standard, meaning the wallets can be recovered even if the company goes out of business.13
In addition to the protections outlined above, there are also several optional security measures that are not required but can help secure user wallets against outside attacks. To reduce the danger of phishing, the Blockchain Wallet allows users to use two-factor authentication or IP whitelists to prevent log-ins from unfamiliar devices. It is also possible to block access through the Tor network, thereby preventing prospective hackers from disguising their IP addresses