BIP 32 — Hierarchical Deterministic Wallets

BIP 32 (Hierarchical Deterministic Wallets) defines how a single master key can deterministically derive a tree of child keys, enabling one backup to cover all future addresses and allowing watch-only wallets via extended public keys (xpubs). Repository status: Deployed.

Debate relevance: Foundational to nearly every self-custody discussion: single-backup wallets, xpub sharing, and derivation-path recovery problems all trace here. Common misstatements: Conflating BIP 32 with BIP 39 — BIP 32 is key derivation; the mnemonic seed words come from BIP 39. Also, sharing an xpub does not risk funds directly but does expose the entire address history of that branch, a privacy (not theft) issue — with the caveat that an xpub plus any single non-hardened child private key can reveal the branch's parent private key.