What are HD Wallets

abril 12, 2023
Mobile wallet security HD wallets

When it comes to managing digital assets, one of the most important considerations is security. With cryptocurrencies, this means finding a reliable and secure wallet that can store your assets without the risk of them being lost, stolen, or hacked. Another interesting point is having several privates keys, however this comes at the expense of having to keep track of all of them. One type of wallet that is particularly interesting is the Hierarchical-Deterministic (HD) wallet since it allows to store several key pairs but the user only has to keep track of one seed phrase. In this blog post, we will explore what HD wallets such as NearMobile are, how they work, and why they are a secure option for storing your digital assets.

What is an HD Wallet?

A Hierarchical-Deterministic wallet, also known as a BIP32 wallet, is a type of crypto wallet that allows users to generate an infinite number of addresses from a single seed phrase. The seed phrase is a string of 12 to 24 words (in the case of Near Protocol 12) that are randomly generated and used to derive all of the private keys and public addresses in the wallet. This means that as long as you have the seed phrase, you can access all of the assets stored in your Near Mobile wallet, and you can also generate new addresses whenever you need them.

BIP 32 - Hierarchical Deterministic HD Wallets

How does an HD wallet work?

An HD wallet works by using a mathematical algorithm called a Hierarchical Deterministic (HD) algorithm, which generates a tree-like structure of private keys and public addresses. The top of the tree is the seed phrase, and each level down represents a different level of derivation. For example, the first level of derivation might be used for NEAR addresses, the second level for Bitcoin addresses, while the third level might be used for Ethereum addresses.

When you create an HD wallet, the software generates a master public key and a master private key. The master public key is used to generate public addresses that can receive payments, while the master private key is used to generate all of the private keys that control the funds in the wallet.

Why Are HD Wallets Secure?

HD wallets are considered to be one of the most secure types of crypto wallets because they offer several key security features:

  1. Private Key Control: With an HD wallet, you have complete control over your private keys. This means that you can back them up and store them in a safe place, or even memorize the seed phrase to ensure that no one else can access your funds.
  2. Hierarchical Structure: The hierarchical structure of an HD wallet makes it more difficult for hackers to access your funds. If someone were to compromise one of your public addresses, they would only have access to a small portion of your funds, rather than your entire wallet.
  3. Random Seed Generation: The seed phrase for an HD wallet is randomly generated, making it virtually impossible for someone to guess or brute-force their way into your wallet.
  4. Address Reuse Prevention: Because HD wallets can generate a new address for each transaction, they can prevent address reuse, which can make it easier for hackers to track your transactions and potentially compromise your wallet.


In conclusion, Hierarchical-Deterministic (HD) wallets are a secure and reliable option for storing your digital assets. With their ability to generate an infinite number of addresses from a single seed phrase, they offer users complete control over their private keys and make it more difficult for hackers to access their funds. If you are looking for a secure way to store your cryptocurrencies, consider using an HD wallet such as Near Mobile App.

NEAR Mobile wallet is a HD non-custodial crypto wallet for the NEAR protocol. Download it here

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