Do I need a key for Stack Exchange?

Only if you want the Stack Exchange source. Stack Overflow and the wider Stack Exchange network are one optional source among many, so the workspace and every other platform work fully without it. When you do want it, a free Stack Apps key is required to turn it on: the API's keyless quota is counted per IP and is already spent on shared hosting, so keyless requests fail.

What does a Stack Exchange key change?

It turns the Stack Exchange source on and gives it its own 10,000 requests/day across the network. Without a key the source stays off while every other source keeps working. The key is free either way.

Why was my Stack Exchange key rejected?

Copy the Key field from your Stack Apps registration (not the client id or secret), then re-paste.

Is my API key stored securely?

Your key is encrypted at rest and only decrypted server-side at the moment it's used. The plaintext never reaches your browser and is never logged. Settings shows only a masked hint.

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Stack Exchange key

Stack Exchange is an optional source: BackTalk and every other platform work without it, so you only need this key if you want to monitor Stack Overflow and the wider Stack Exchange network. When you do want it, a key is required to turn it on. The key itself is free: the Stack Exchange API technically allows keyless calls, but its keyless quota is counted per IP address and shared hosting sends requests from shared IPs, so that quota is almost always already spent by other tenants and keyless requests simply fail. A Stack Apps key gives BackTalk a quota of its own, so the source only turns on once a key is saved.

What it unlocks

One key enables monitoring across the developer-relevant Stack Exchange network:

Stack Overflow, Server Fault, Super User, Ask Ubuntu, Software Engineering, DBA, Security, and DevOps.

Get your API key

Go to Stack Apps → Register a new OAuth app and sign in with your Stack Exchange account.
Fill in a name and any URL (OAuth Domain can be localhost; BackTalk only uses the resulting key, not the OAuth flow).
Register the app, then copy the Key it issues (not the client id or secret).

Add it in BackTalk

Go to Settings and find the Stack Exchange card under Data sources.
Paste the Key.
Save. BackTalk validates and stores it encrypted, and Stack Exchange monitoring switches on.

Quota

A free key comes with 10,000 requests/day across the Stack Exchange network. There's no dollar cost.

Troubleshooting

The source shows "no key". Stack Exchange stays off until a key is saved; add one as above and it turns on automatically (unless you had switched it off by hand).
"The provider rejected that API key." Copy the Key field from your Stack Apps registration (not the client id or secret), then re-paste.
Still rate-limited with a key. Very large keyword sets can exhaust even the raised quota; spread keywords across sources or reduce them.

Your key stays private. It's encrypted at rest and only decrypted server-side at sync time. It is never returned to your browser and never logged. Settings shows only a masked hint.

Replacing your key: paste a new Stack Apps key into Settings to replace the old one. Removing it turns the source off until a key is saved again.