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

Phantom is a non-custodial cryptocurrency wallet built originally for the Solana blockchain. It now supports other networks, such as Bitcoin and Ethereum, but it is still mainly used as a gateway to the Solana ecosystem.

There are many other non-custodial wallets available and many offer similar benefits, but this article will focus on Phantom wallet.

If you only hold SOL on an exchange, you cannot usually use many Solana apps directly. To interact with NFTs, decentralised finance (DeFi) protocols or on-chain staking, you will need a compatible wallet such as Phantom.

This guide explains what Phantom is, how to set it up securely, and how to fund it from your CoinJar account. It is for information only and is not personal advice.

What is a Phantom wallet?

Phantom is a hot wallet. This means it is software, either a browser extension or a mobile app, that stays connected to the internet so you can send and receive crypto quickly. The benefit of this convenience is that it can be more exposed to online risks than an offline (cold) wallet.

It is also a self-custody wallet. Unlike your CoinJar account, where CoinJar manages the private keys on your behalf, Phantom stores the private keys on your device and gives you direct control.

Because you control the keys, you can move your funds at any time without asking a provider to approve the transaction. However, you are also fully responsible for keeping those keys secure. If you lose your Secret Recovery Phrase or it is stolen, there is usually no way to recover access to your assets and no one is obliged to reimburse you.

Step 1: Download and install

Phantom is free to download and works with major browsers such as Chrome, Firefox, Brave and Edge, and on iOS and Android devices.

You should only download Phantom from official sources. Fake websites and apps are common, and some are designed to look almost identical to the real thing in order to steal your funds.

1. Go to the official Phantom website, or search for "Phantom" in the Apple App Store or Google Play Store.
2. Select the version that matches your browser or device.
3. Follow the on-screen prompts to add the extension to your browser or to install the mobile app.

Take your time during this step and check that the publisher and URL are genuine before you install anything.

Step 2: Create a new wallet

Once installed, open Phantom. You will usually see two core options:

• Create a new wallet
• I already have a wallet

Choose Create a new wallet if this is your first Phantom wallet. Choose I already have a wallet only if you are restoring an existing wallet with a recovery phrase.

Step 3: Secure your Secret Recovery Phrase

This is the most important part of the setup process. Phantom will generate a Secret Recovery Phrase, often called a seed phrase. It is 12 random words in a specific order, for example:

witch collapse practice ...

(Your phrase will be different. Never share your actual phrase with anyone.)

This phrase represents your private key in a form you can write down. It is effectively the master key to everything in your wallet. If your laptop is stolen or your phone breaks, entering these 12 words into Phantom on a new device is usually the only way to regain access to your crypto.

If someone else gets your phrase, they can take full control of your wallet and move your funds without your consent. There is no "undo" button.

How to store your phrase safely

• Write it down on paper: Use a pen and paper. Write the words in the exact order (1 to 12), and double-check the spelling.
• Keep it offline: Do not take a screenshot, do not store it in cloud storage, notes apps, email, messaging apps or online password managers. Anything connected to the internet can be hacked.
• Store it securely: Keep the paper in a secure place such as a safe, lockbox or another protected location only you (and any trusted co-owner) can access. Consider having a second copy in a separate safe location in case of fire or loss.

Phantom may ask you to re-enter some or all of the words to confirm you have recorded them correctly. Do not rush this step. If you get the phrase wrong, you may not be able to restore your wallet in future.

Step 4: Create a password

After you have secured your Secret Recovery Phrase, Phantom will ask you to set a password for the wallet on that device.

This password locks Phantom on your current laptop or phone. If someone gains physical access to your device, the password should stop them opening Phantom easily.

However, this password does not back up your wallet. It cannot restore your crypto on a new device. Only your 12-word Secret Recovery Phrase can do that. Losing the phrase, even if you still remember the password, can mean permanently losing access to your assets.

Alternative: Seedless setup

Phantom has introduced a "seedless" onboarding option for some users. Instead of managing a 12-word phrase yourself, you can create a wallet using your Google or Apple account together with device biometrics such as FaceID.

This approach uses Multi-Party Computation (MPC). In simple terms, your private key is split into several parts (often called "shards"), which are stored in different locations and combined only when needed.

• Pros: Set-up can feel quicker and more familiar, especially if you are used to logging in with Google or Apple on other apps.
• Cons: You are now relying on external systems and infrastructure. If you lose access to your Google or Apple account, or change phones without proper backup, you may face problems recovering your wallet. You are also trusting additional third parties with parts of the security process.

For people who want direct, traditional self-custody and are comfortable looking after their own Secret Recovery Phrase, the standard 12-word phrase method is still widely used. Each method involves trade-offs between convenience and control, and neither removes the risk of loss.

How to fund your Phantom wallet from CoinJar

Once your wallet is set up, it will start with a balance of zero. To use the Solana network, you need SOL to pay transaction fees, sometimes called "gas". The cost per transaction is usually low compared with some other networks, but it can still vary and it is not guaranteed.

To send SOL from CoinJar to Phantom:

1. Copy your Phantom address
   Open Phantom and select the "Receive" option. Choose "Solana" from the list. You should see a QR code and a long string of letters and numbers (for example 8FE...k92). Click "Copy" to copy this address.

2. Log in to CoinJar
   Open your CoinJar app or sign in to the web version.

3. Start a withdrawal
   Go to your Solana (SOL) wallet in CoinJar and choose "Send" or "Withdraw".

4. Paste and confirm the address
   Paste the Phantom address into the recipient field. Carefully check the first and last few characters to make sure it matches what you see in Phantom. Enter the amount of SOL you want to send. If you prefer, you can calculate the value in GBP and then convert to SOL within CoinJar.

5. Send the transaction
   Review all the details, including the network (it must be Solana), the amount and the address. Once you confirm, CoinJar will broadcast the transaction to the Solana network.

Solana is designed to process transactions quickly, so your SOL may arrive in Phantom within seconds or a few minutes. Network issues or congestion can still cause delays, so timing is not guaranteed.

Crypto transfers are generally irreversible. If you send SOL to the wrong address or the wrong network, it is very unlikely you will be able to get it back.

Real-life examples: What can you do with Phantom?

Phantom lets you interact with a wide range of Solana-based services. These activities can be complex and high risk. Prices can move sharply and you could lose some or all of the funds involved.

Staking as a delegator

Solana uses a Proof of Stake system. Through Phantom, you can delegate your SOL to a validator to help secure the network and potentially earn rewards paid in SOL.

Basic steps in Phantom:

• Click your SOL balance.
• Select "Start earning SOL".
• Choose a validator from the list shown in the wallet.

When you delegate, the SOL stays in your wallet address, but its "voting power" is assigned to the validator. In return, you may receive rewards, although these are not guaranteed and the rate can change.

Important points and risks:

• Your SOL is usually locked while staked and can take a few days (commonly 2 to 3 days) to unstake before you can move it.
• Validators can behave poorly or be penalised at protocol level, which may affect your rewards or, in some designs, your stake.
• The value of SOL itself can rise or fall sharply, so even if you earn rewards, the GBP value of your holdings could still drop.

Only stake amounts you are prepared to keep locked for a period of time and accept that returns are not certain.

Transaction simulation

Phantom includes a transaction simulation tool. Before you approve a transaction, such as a token swap or NFT mint, Phantom will try to show a preview of what is expected to happen.

For example, it might show:
"You will give 1 SOL and receive 50 USDC."

This preview can help you spot potential scams or mistakes. If Phantom instead shows something like:
"You will give All SOL" and receive nothing, this is a strong warning sign.

If the simulation looks unusual, confusing or too good to be true, you can and should cancel the transaction. Simulation is a helpful safety feature, but it is not perfect and cannot protect you from all scams or smart contract bugs. You remain responsible for what you approve.

Security risks and red flags

No wallet is completely risk-free. Phantom includes useful security features, but as a hot wallet it is always online and therefore exposed to internet threats.

You should consider keeping only smaller, spending-level amounts in hot wallets, and use more secure storage solutions for larger holdings if appropriate to your situation.

Phishing attacks

Phishing is one of the most common ways people lose funds. Scammers create fake websites that copy well-known NFT marketplaces, DeFi platforms or exchanges. The aim is to get you to connect your wallet and approve malicious transactions.

To reduce the risk:

• Type website addresses yourself or use trusted bookmarks instead of clicking random links.
• Check the URL carefully for spelling mistakes or strange domain endings.
• Be wary of links from social media, email or instant messages, even if they appear to come from official accounts.

If you are not sure a site is genuine, do not connect your wallet.

Support impersonators

Scammers often pose as "support" staff for Phantom, CoinJar or other crypto services. They may contact you on Telegram, Discord, X (Twitter) or other platforms, often offering to "fix" a problem or help with an error.

A frequent red flag is any request for your 12-word Secret Recovery Phrase.

Golden rule:
No genuine support staff, whether from Phantom, CoinJar or any other reputable company, will ever ask for your Secret Recovery Phrase or private keys. Not in chat, not over the phone, not by email.

If anyone asks for your phrase, they are trying to take your funds. End the conversation and report or block the user if possible.

Summary

Phantom is a non-custodial hot wallet that gives you direct control over your SOL and other supported assets, and allows you to interact with the wider Solana ecosystem. By setting up the wallet, securing your Secret Recovery Phrase and funding it from CoinJar, you can start to explore activities such as staking, token swaps and NFTs.

However, using crypto wallets involves significant risk. Transactions are usually irreversible, prices can be extremely volatile and there is no guarantee you will get your money back if something goes wrong. Keeping your Secret Recovery Phrase safe, checking addresses carefully and being cautious with new apps and websites are all crucial steps in protecting your funds.

Always take your time, start with small amounts you can afford to lose, and do your own research before using any third party service or protocol.