Matrix and its implementations like Synapse have a very intimidating architecture (I’d go as far as to call most of the implementations somewhat overengineered) and the documentation ranges from inconsistent to horrific. I ran into this particular situation myself, Fortunately this particular step you’re overthinking it. You can use any random string you want. It doesn’t even have to be random, just as long as what you put in the config file matches. It’s basically just a temporary admin password.

Matrix was by far the worst thing I’ve ever tried to self-host. It’s a hot mess. Good luck, I think you’re close to the finish line.