BIP-85
BIP-85 is a wallet standard for deriving child seeds, passwords, or entropy from one master seed. It lets a hardware wallet create separate backups for smaller wallets without inventing new randomness each time.
How It Works
BIP-85 uses a master seed to derive new entropy at specific indexes. That entropy can become a new 12-word or 24-word seed phrase, a password, or another secret. The child looks independent, but it can be recreated from the parent seed and the same index.
This is handy when you want several small wallets without creating several unrelated backups. For example, a COLDCARD can derive a child seed for a phone wallet, a test wallet, or a duress wallet. If the phone dies, the child seed can be recreated from the parent.
The tradeoff is concentration. The parent seed now controls more than one wallet. Protect it like the root of a tree, because it is one.
Key Points
- Derives child secrets from one master seed
- Useful for test wallets, smaller spending wallets, and compartmentalized setups
- The child can be recreated if you know the parent seed and index
- Compromise of the parent seed compromises all children
- Record indexes and purpose labels so future recovery is not guesswork