CryptoURANUS Economics: Mnemonics: Defined in CryptoCurrency


Sunday, November 28, 2021

Mnemonics: Defined in CryptoCurrency

Mnemonics: Defined in CryptoCurrency


Mnemonics are memory aids with a system such as letters or associations that help in recall. *see Mnemonic Phrase.

What Are Mnemonics?

Mnemonics are simply songs, abbreviations and rhymes that assist in remembering something.

In the world of cryptocurrencies, mnemonics is a group of words, usually 12 or more that are generated when a new crypto wallet is created.

The whole point of this is to ensure crypto wallets can be accessed if the password is lost.

It is very difficult to retrieve the details of a cryptocurrency wallet given its decentralized and secure nature.

But mnemonic groups can be used to retrieve details.

There are two types of mnemonics used in cryptocurrencies. These include the mnemonic phrase and mnemonic passphrase.

A mnemonic phrase is also called seed key, mnemonic seed, and recovery seed, to name a few abbreviations.

Every time a new crypto wallet is generated, users are encouraged to take note of a mnemonic phrase — 12, 18 or 24 words long — on a piece of paper or to store it in any other safe place.

This ensures that users are not locked out of crypto wallets.

There are many obvious benefits of using a mnemonic phrase, including making the crypto wallet more secure and making it easier to store.

Mnemonic passphrases are an extra added layer of security, building up on mnemonic phrases, and act as a two-factor authentication for the crypto wallet.

They're also known as a mnemonic extension or a seed extension.

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