Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-01343
Passphrase unavailable — software wallet (2025)
SurvivesCase description
A 2025 case involved a MetaMask wallet user who had set a custom password for their wallet but could not recall it after a phone factory reset and reinstallation. Unlike hardware wallets, MetaMask does not use a standard BIP39 encryption scheme for its password—it uses a custom PBKDF2-based encryption. The holder had their seed phrase documented, which they used to restore the wallet. The password for the local encrypted vault was irrelevant once the seed phrase was used in the fresh installation. The case illustrated the distinction between the wallet password (which protects local access) and the seed phrase (which is the true recovery mechanism)—a distinction many users do not understand.
Custody context
| Stress condition | Passphrase unavailable |
| Custody system | Mobile or software wallet |
| Outcome | Survives |
| Documentation | Unknown |
| Year observed | 2025 |
| Country | International |
Structural dependencies observed
Outcome interpretation
Access remained possible under the reported conditions.
Source
Privately Reported
Evidence type
News article
Related cases involving passphrase unavailable
217 cases involve passphrase unavailable
572 cases involve mobile or software wallet
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This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
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Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.