GlossaryAdvanced
Derivation Path
A formula a wallet uses to generate many key pairs from a single seed phrase.
A derivation path is a standardized formula that lets a wallet generate a large, organized set of key pairs and addresses from a single seed phrase, rather than needing to back up each key separately.
Using the same seed phrase with a different derivation path, or in wallet software that doesn't follow the same standard, can sometimes produce a different set of addresses, which is why matching software matters when restoring a wallet.
Examples
- Restoring a wallet from a seed phrase in compatible software should reproduce the same addresses via the same derivation path.
- Different cryptocurrencies typically use different standard derivation paths.