What Is a ‘Hierarchical Deterministic’ (HD) Wallet?
A Hierarchical Deterministic (HD) wallet is a system defined by BIP-32 that allows for the creation of a 'master' private key (seed phrase) from which all subsequent private and public keys can be deterministically generated in a tree-like structure. This is highly beneficial because the user only needs to back up the single master seed to restore all their accounts and future addresses.
It improves privacy by generating a new address for every transaction.
