2/n

A vital distinction in wallets lies in key derivation. They're either nondeterministic (random keys) or deterministic (derived from a seed). Nondeterministic wallets, often a collection of random keys, are cumbersome for backup and usage, challenging address reuse principles.

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3/n

Deterministic wallets, on the other hand, link all keys to a master seed, streamlining backup and management.