What Are Cryptocurrency Transaction Memos?

Prominent exchanges have stated that it is the user’s responsibility to determine whether a memo or tag is required by their recipient’s wallet. It is critical to be aware of what a transaction memo is and how it works.

Transaction Memos Unique to Certain Crypto Tokens

A cryptocurrency destination tag/memo is an additional address feature that is essential for select cryptocurrency tokens to identify the recipient of a transaction beyond a simple wallet address used traditionally for currencies like Ether (ETH).

Binance.US highlighted that if a user forgets the memo for a transfer, the funds might not arrive at the destination until that information is supplied. 

Crypto tokens that require the use of the cryptocurrency memos are BNB (BNB), Cosmos (ATOM), EOS (EOS), Hedera Hashgraph (HBAR), NEM (XEM), XRP (XRP), Stellar Lumens (XLM), Stacks (STX), Algorand (ALGO), Anchor Protocol (ANC), Bonded Luna (BLUNA) or Terra Classic (LUNC).

It is also valid for any tokens sent to a user’s account on Binance Chain (BEP2). It is noteworthy that a destination tag/memo is as important as a wallet address when transferring funds to a shared wallet.

The only cryptocurrency token that currently implements the use of cryptocurrency destination tags is XRP. As explained by Freewallet, the difference between a crypto memo and a tag is that a tag is a special set of numbers that is unique for each user.

For these aforementioned crypto tokens, users would need to include a tag/memo unless the transfer is to a privately owned and controlled cryptocurrency wallet, for example, those downloaded on the user’s PC/Laptop or cold storage hardware wallets.

Source : bsc.news

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