Trying to grasp seedphrase vs. passphrase

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So I’m trying to see if I got this right?

From an internet search

“A seed phrase (12-24 random words) is the mandatory master backup for recovering a cryptocurrency wallet, while a passphrase (or “25th word”) is an optional, user-defined string that adds a layer of security, creating a completely hidden, separate wallet. Seed phrases recover assets; passphrases secure them”

So, with my limited knowledge of a cold wallet, here’s a scenario

  1. I login to river and buy $400 worth of bitcoin.

  2. I create a seedphrase and store it on a ledger or Trezor cold wallet. Say it’s 12 words

  3. In addition, I can choose a passphrase which is essentially a password that I have to enter to get to my seedphrase to buy/sell bitcoin on my ledger cold wallet? Isn’t that the same thing as a pin? Or is the pin device specific? I thought you needed a pin as well to get into the cold wallet. So with a passphrase , I could lose my Trezor wallet, buy another wallet and enter that passphrase and have access to my 12 word seedphrase?

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The passphrase is different from the typical pin or password concepts you are used to.

Your seed phrase doesn’t represent one wallet: it represents a “library” of wallets, each identified by its passphrase.

(some passphrase is always there; if you “don’t use” passphrase, an empty one is used automatically)

All passphrases are equally valid. By “creating” a passphrase protected wallet, you are in fact choosing which wallet you will be working with today.

The “protection” does NOT come from the usual concept of “if you put in a wrong passphrase, you can’t enter”.

Instead, it’s “if you put in a wrong passphrase, you enter the wrong place”.

All of “hunter2”, “hunter 2”, and “humter2”, are equally valid choices of a wallet, as far as your Trezor is concerned. The device doesn’t know which one you picked (in fact, Trezor device doesn’t even know which one you actually put your money on)

This means that you cannot add or change a passphrase. The passphrases point to different wallets: to “change” a passphrase, you actually have to send funds to another address.

(you are not “changing” the passphrase, you are taking the money out of passphrase A and putting it on passphrase B)

So you can log in to your CEX and send money to your Trezor to passphrase A. On a different day, you log in and send other money to passphrase B. Both are now under your seed phrase, but in separate wallets under different passphrases.

If someone steals your Trezor, they have to input PIN to unlock the device. (that’s the traditional thing). But even then – or if they steal the seed phrase directly – they won’t see any funds. If they try to input a passphrase, and guess passphrase A, they will find the first transfer but not the second one.

Neither the Trezor nor any blockchain record can identify that any of the passphrases are in use: even if you know passphrase A, that doesn’t tell you whether passphrase B or XYZ or any other was ever used: all of the passphrases “exist” mathematically, you’d have to check each one by one to see if something is there.

You always need both the seed phrase and the passphrase. If you lose a Trezor and buy a Ledger, you will first have to input the seed phrase, and then open the right passphrase. If you put money on a passphrase, then without knowing both the seed phrase and the passphrase, this money is inaccessible.

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