A hardware wallet passphrase is an optional, case-sensitive string combined with a device's recovery words to derive a separate set of wallet accounts. It is sometimes called a 25th word, although it can contain multiple words, spaces, or other supported characters. Every different input creates valid but different addresses, so a typo can appear as an empty wallet.

To set up a hardware wallet passphrase, use only the manufacturer's built-in feature, choose whether the device should request it temporarily or link it to a secondary PIN, and record the exact input offline. Verify the newly derived receiving address, test access after reconnecting, and complete a small recovery rehearsal before moving significant assets into the passphrase-protected accounts.

What Do You Need Before You Set Up a Hardware Wallet Passphrase for Extra Security?

Prepare the supported device, verified instructions, tested recovery phrase, and a separate offline passphrase backup before enabling this advanced feature. The original 24 words and extra passphrase are both required to reconstruct the protected accounts.

  1. A supported hardware wallet. Confirm that the exact model and current firmware provide an official passphrase menu, since recovery and PIN behavior differs between manufacturers and devices.
  2. A verified recovery-phrase backup. Check that the existing 24 words are complete before changing settings because they remain the foundation for both standard and passphrase-derived accounts.
  3. A private setup environment. Prevent cameras, screen sharing, and observers from seeing the passphrase, and enter it directly on the hardware device whenever the manufacturer supports that method.
  4. Separate offline backup storage. Plan where to record the exact characters without storing the passphrase beside the 24 words, which would remove much of the added protection.

How to Set Up a Hardware Wallet Passphrase: A Step-by-Step Guide

Complete each check in order and verify the resulting public record before increasing the amount or risk.

Step 1: Verify official device support. Open the manufacturer's current documentation, update only through its verified application, and locate the passphrase settings on the hardware device. Do not use a third-party recovery or passphrase generator.

Step 2: Choose temporary or PIN-attached access. A temporary passphrase lasts until the device restarts or locks, while a PIN-attached option opens the protected accounts with a secondary PIN. Select the mode whose recovery process you can repeat reliably.

Step 3: Enter and record the exact passphrase. Create a strong case-sensitive input and confirm it on the trusted device. Copy every character, space, and capitalization offline because the manufacturer cannot determine which version you intended.

Step 4: Verify the new account addresses. Open the companion wallet under passphrase access and record a public receiving address separately from the secret. Switch back to standard access to confirm that the original accounts remain distinct.

Step 5: Test recovery before transferring funds. Send a small amount to the new address, restart the device, and reproduce access using the correct passphrase or secondary PIN. Transfer more only after the same address and test balance return.

Does a Hardware Wallet Passphrase Cost Anything?

Creating a hardware-wallet passphrase does not require blockchain gas or a service fee. Costs arise only from buying the device and transferring assets from standard accounts to the newly derived passphrase accounts.

Each transfer pays the relevant network fee, so moving several assets across multiple chains can require several transactions. Ledger's passphrase can contain up to 100 characters, and each distinct input creates different addresses. The passphrase is not recoverable from the device or company account.

What Common Mistakes Should Hardware Wallet Passphrase Users Avoid?

The most serious mistake is moving all assets before testing recovery. A typo, missing space, capitalization change, or forgotten passphrase opens different addresses and can make the funded accounts permanently inaccessible.

Do not store the passphrase beside the 24 words, confuse it with a PIN, or type the recovery phrase into a computer to test it. A secondary PIN is only a shortcut on that device; restoration still requires the exact recovery phrase and passphrase.

Why Is the Hardware Wallet Passphrase Called a 25th Word?

The term 25th word is shorthand, not a literal requirement. A passphrase is a separate case-sensitive string combined with the 24-word recovery phrase to derive an entirely different wallet. The same recovery phrase can therefore produce the normal wallet plus many passphrase wallets, with no visible link between them in the blockchain records.

It can contain more than one word, spaces, numbers, or other supported characters. It is never written as an extra item on the BIP-39 recovery list. Treating it as a simple dictionary word can weaken security and create confusion during restoration. A longer passphrase can improve guessing resistance, but recoverability still depends on recording a string that the owner can reproduce exactly years later.

What Happens If You Forget a Hardware Wallet Passphrase?

The passphrase-protected accounts become inaccessible if you cannot reproduce the exact input. The original 24 words still restore the standard wallet, but they do not reveal or reset the additional passphrase. Repeated guessing is risky because each plausible variation opens another valid address set and gives no indication that the intended wallet exists elsewhere.

Trying similar spellings produces valid yet unrelated wallets, often with zero balances. The manufacturer cannot identify the correct one. This is why recovery must be tested from a locked or restarted device before any important balance is transferred. Test the full restoration process using official instructions and public addresses, without exposing the 24 words or passphrase to an internet-connected recovery service.

Related Concepts

  1. What Is a Wallet?
  2. What Is a Private Key?
  3. What Is a Seed Phrase?
  4. What Is a DApp?

Further Reading

  1. Best Web3 Wallets' List for 2026: An Overview of Top Options
  2. What Are the Best Cryptocurrency Hardware Wallets in 2026?
  3. What Is a Ledger Hardware Wallet and How To Set Up Your Ledger?
  4. MetaMask Web3 Wallet vs. Ledger Hardware Wallet: Which Wallet Is Best in 2026?