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The importance of the Derivation path in your BCH wallet and in any other
An original article from estudiobitcoin and translated by me for you since I consider it very important that you know this information due as it is something very useful, and most people have trouble accessing their wallets when they try.
The derivation path in almost all cryptocurrencies is something that is typical of all wallets called HD (Hierarchical Deterministic) that have a structural model in their organization and always determine the same result.
These wallets have a software whose main function is to generate an infinite number of addresses and generate keys (mnemonics or the 12 recovery words) and the balance you have in it in any other wallet that is compatible. This allows you to access your coins easily. These keys are known by the name of seeds, and it is easier because you do not have to remember a long complex key of numbers and special symbols.
In summary, HD wallets are wallets that generally have 12 words that are human-readable and that allow you to have an unlimited number of addresses on any blockchain that is compatible with that type of wallet.
It is the way to enter your address where your coins are using the 12 recovery words or seeds.
Going into more technical terms, most of the wallets use BIPS (means Bitcoin Improvement Proposal, they are proposals for improvements to the protocol that are being reviewed by developers that are open source among other things) that have the following characteristics:
BIP 32: m / 0 '/ 0/0 → (oldest)
BIP 44: m / 44 '/ 0' / 0 '/ 0/0 → Used for addresses named Legacy
BIP 49: m / 49 '/ 0' / 0 '/ 0/0 → Used for addresses named Segwit
BIP 84: m / 84 '/ 0' / 0 '/ 0/0 → Used for addresses named Native
In HD wallets there is a single phrase or seed of 12 words which are decoded through cryptographic algorithms and mathematical equations to be able to derive an infinite number of key pairs.
If any of those words are changed, the private key that you get will be different, and you will not be able to access where you have your coins, so be very careful with this.
And that is why it is very important to have these words safeguarded, preferably written on paper, so that in case the phone is lost, the PC is damaged, or that for any other reason we cannot access our device, we can have access on any other device if we have these words.
Always remember to copy the derivation route and its seeds, because this way you can have access to your coins whenever and wherever you want. And they can also import your wallet to any other that is compatible.
I comment on this because I have seen many cases in which despite having all 12 keywords, people cannot access their coins, and this happens because they have not configured the derivation path correctly. Most wallets allow you to configure this.