BIP 32 BIP 39

In bitcoin, you usually use new key pairs for every transaction you make. It becomes unmanageable when your keys grow over time, as you need to store each private key in your wallet. A Hierarchical Deterministic wallet or HD wallet helps users by just deriving key pairs from a single seed instead of randomly generating it. This way you only need to store the seed or sometimes called the master key.

Keys used in bitcoin are elliptic curve key pairs. The private key is used to sign a transaction and is kept hidden safe in a crypto wallet. This key is a hash of a 32bit seed generated randomly and is not human readable. Basically you can derive all of your key pairs and addresses from the seed so its really important if you have a really have a backup of it. Even its string representation in either base64 or hex is not human friendly and is hard to memorize. Backing it up by writing it on a piece of paper or memorizing it is not a good thing to do since it is very prone to human error. You might accidentally write a wrong character. Memorizing it is practically impossible. So you are force to copy it in a file, making it insecure if your system gets compromised. BIP solves this problem by mapping the seed to a chosen set of simple words, words that a normal human brain would easily recognize. An algorithm is applied to the seed to produce the words, typically ranges from 12 to 24 words. So basically you can derive the seed from the word set and you can also derive the word set given the seed.

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