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Crypto Glossary/Account Number

Account Number

Account numbers are unique identifiers used in cryptocurrencies to represent a user's wallet or address. They are generated through cryptographic algorithms applied to a user's public key, providing security, privacy

TLDR - Account Number

An account number is a unique identifier assigned to an individual or entity within a financial system. In the context of cryptocurrencies, an account number is used to represent a user's wallet or address. It is a string of alphanumeric characters that allows for the sending and receiving of digital assets on a blockchain network. Account numbers are essential for securely transacting and managing cryptocurrency holdings.

Structure and Format

Cryptocurrency account numbers are typically represented as a string of alphanumeric characters. The specific format and length of an account number depend on the blockchain network and the type of cryptocurrency being used. For example, Bitcoin addresses are usually 26-35 characters long and start with a '1' or '3', while Ethereum addresses are 42 characters long and start with '0x'.

Account numbers are generated using cryptographic algorithms, such as hash functions, which ensure their uniqueness and security. These algorithms take a user's public key as input and produce a corresponding account number. The public key is derived from the user's private key, which is kept secret and used for signing transactions.

Public Key Cryptography

Account numbers are closely tied to public key cryptography, a fundamental aspect of blockchain technology. Public key cryptography involves the use of a key pair: a public key and a private key. The public key is shared openly and serves as the basis for generating the account number, while the private key is kept secret and used for cryptographic signing.

When a user wants to receive funds, they share their account number (derived from the public key) with the sender. The sender then uses the account number to encrypt the transaction data, ensuring that only the intended recipient can decrypt and access the funds using their private key. This cryptographic process provides security and authenticity to cryptocurrency transactions.

Address Generation

Account numbers are generated through a series of mathematical operations applied to the user's public key. The specific process varies depending on the cryptographic algorithm used by the blockchain network. In most cases, the generation process involves applying a hash function, such as SHA-256 or RIPEMD-160, to the public key.

Once the hash function is applied, the resulting hash is further processed to create the final account number. This may involve adding a checksum to detect errors, encoding the hash in a specific format, or applying additional cryptographic operations. The resulting account number is then ready to be used for receiving funds.

Security and Privacy

Account numbers play a crucial role in maintaining the security and privacy of cryptocurrency transactions. Since account numbers are derived from public keys, they do not reveal any sensitive information about the user. This allows users to transact pseudonymously, without disclosing their real-world identity.

Additionally, the cryptographic nature of account numbers ensures that they are virtually impossible to guess or forge. The use of hash functions and other cryptographic operations makes it computationally infeasible to reverse-engineer a private key from an account number. This provides a high level of security against unauthorized access to funds.

Address Reuse and Hierarchical Deterministic Wallets

While account numbers are generally considered safe to share publicly, it is generally recommended to avoid reusing them for multiple transactions. Reusing the same account number can compromise privacy and make it easier for others to track a user's transaction history.

To address this concern, hierarchical deterministic (HD) wallets have been developed. HD wallets use a master seed or root key to generate a sequence of account numbers. Each time a user receives funds, a new account number is generated from the master seed. This allows for improved privacy and reduces the risk of address reuse.


Account numbers are essential components of cryptocurrency transactions, serving as unique identifiers for wallets or addresses. They are generated through cryptographic algorithms applied to a user's public key and provide security, privacy, and authenticity to transactions. Understanding the structure and features of account numbers is crucial for securely managing and transacting with cryptocurrencies.

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