Wallet Derivation Paths Explained
A derivation path tells a wallet which addresses to create from your seed phrase. Learn how paths like m/44'/60'/0'/0/0 work and how to fix missing balances.
A derivation path is a short code, such as m/44'/60'/0'/0/0, that tells a wallet exactly which private key and address to generate from your seed phrase. The same seed phrase can produce billions of different addresses, and the path picks one of them, so two wallets using the same seed but different paths will show different addresses and balances.
This is why people sometimes restore a seed phrase into a new wallet and see an empty balance, even though their funds are perfectly safe on the blockchain. Understanding derivation paths turns that frightening moment into a settings fix. It also helps you write better backup notes.
How HD Wallets Turn One Seed Into Many Addresses
Older wallets generated random, unrelated keys, and each one had to be backed up separately. Hierarchical deterministic wallets fixed this. Defined in BIP32, they derive every key from one master seed in a tree structure. BIP39 standardized turning that seed into a list of 12 or 24 words, the seed phrase you back up.
Because derivation is deterministic, the same seed and the same path always produce the same key. That is what makes a single backup enough. It also means that a wallet looking down a different branch of the tree simply won't see your funds. For a deeper look, see Multi-Chain Wallets.
Reading a Derivation Path
BIP44 defined a common layout. Take the first Ethereum account path, m/44'/60'/0'/0/0:
| Level | Value | Meaning |
|---|---|---|
| m | master | The root key derived from your seed |
| purpose | 44' | Which standard is used (here BIP44) |
| coin type | 60' | Which blockchain: 0 for Bitcoin, 60 for Ethereum, per the SLIP-44 registry |
| account | 0' | Lets you keep separate accounts under one seed |
| change | 0 | 0 for receiving addresses, 1 for change addresses (mainly Bitcoin) |
| address index | 0 | The individual address: 0, 1, 2 and so on |
The apostrophe means hardened derivation, a security feature that stops a leaked child key from being used to compute related keys. Some tools write it as "h" instead.
Common Paths You'll See
Bitcoin address types
Bitcoin uses different purpose numbers for different address formats:
- m/44'/0'/0' – legacy addresses starting with 1
- m/49'/0'/0' – nested SegWit addresses starting with 3
- m/84'/0'/0' – native SegWit addresses starting with bc1q
- m/86'/0'/0' – Taproot addresses starting with bc1p
If you restore a seed and see no Bitcoin, check that the wallet is scanning the right address type.
Ethereum and EVM chains
Most EVM wallets use m/44'/60'/0'/0/x, incrementing the last number for each new account. Some wallet software has historically incremented a different level instead, for example m/44'/60'/x'/0/0, which is why accounts beyond the first can appear "missing" when you switch wallets. Because EVM chains share an address format, the same path gives you the same address on Ethereum and other EVM networks. See why your wallet shows different addresses on different chains.
Solana and other chains
Solana wallets commonly use paths based on coin type 501, but different wallets have used different variations over time. Many wallets show a choice of paths during import for this reason.
How to Fix a Missing Balance After Restoring
- 1Don't panic and don't move anything. Your funds are on the blockchain, not in the app.
- 2Check the address. Compare the restored wallet's first address with an old transaction or an address you saved. If they differ, it's a path or address-type issue.
- 3Look for path options. Many wallets have an "advanced," "custom path" or "import" setting that lists common paths.
- 4Try the original wallet's defaults. Wallet documentation usually states which path it uses.
- 5Check for a passphrase. If you used an optional passphrase (a "25th word"), a different or missing passphrase also produces a completely different wallet. See passphrases explained.
- 6Look further down the tree. If you used many addresses, increase the wallet's address gap limit or add accounts manually.
Never paste your seed phrase into a website offering to "find your path." Legitimate recovery tools run offline, and many "path finder" sites are phishing pages.
Why Wallets Don't Just Scan Every Path
You might wonder why wallets don't simply check all possible paths automatically. The tree is effectively infinite, and every check requires looking up addresses on the blockchain, which is slow and can leak information about which addresses you own to the service doing the lookup. Wallets therefore scan a limited set of default paths and stop after a number of unused addresses in a row, known as the gap limit.
That design is sensible for privacy and performance, but it means unusual setups need a little help from you during recovery.
What to Write in Your Backup Notes
Alongside your secured seed phrase, it helps to store, separately and safely:
- Which wallet software or hardware wallet you used, and roughly when
- The derivation path or address type, if you changed the default
- Whether a passphrase exists (but not the passphrase next to the seed)
- One public receiving address, so you can confirm a restore is correct
This information isn't secret on its own, but it can save hours during recovery. Our guide on how wallet recovery works covers the full process.
Bottom line
A derivation path is the map from your seed phrase to a specific address. When a restored wallet shows nothing, the cause is almost always a different path, address type or passphrase, not lost funds. Know which wallet and settings you used, keep a public address for reference, and use your wallet's advanced import options before assuming the worst.
Frequently asked questions
Why does my restored wallet show a zero balance?
The most common reason is that the new wallet uses a different derivation path or address type than the original one, so it is generating different addresses from the same seed phrase. Check which path the original wallet used and select it in the new wallet's advanced or import settings.
Is a derivation path secret?
No. Derivation paths are standard, public conventions and do not give access to your funds. Only your seed phrase and any passphrase must be kept secret. It is helpful to note the path and wallet software you used alongside your backup, without writing it next to anything that reveals the seed.
What does the apostrophe in a derivation path mean?
The apostrophe, sometimes written as h, marks a hardened derivation level. Hardened keys add a security property: someone who learns a child private key and the parent's public extended key cannot use them to work out other keys at that level.
Do I need to know my derivation path to recover a wallet?
Often the default works, but not always. If you used a less common wallet, an older version, or non-default settings, recording the wallet name and path helps you or your heirs restore funds later. Keep that note separate from your seed phrase backup.