Overview
An xpub (extended public key) is a special public key defined by the BIP32 HD wallet standard that can mathematically derive an entire tree of child public keys and their corresponding Bitcoin addresses. By sharing an xpub with a service, the service can generate new receive addresses and monitor balances without having any ability to spend the associated funds.
Key Derivation
Master Seed
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[BIP32 derivation]
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m/84'/0'/0' (account-level key pair)
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┌─────────────┐
│ xpub │ ← Extended public key at this path
│ (shareable) │
└──────┬──────┘
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┌────┴────┐
| |
m/.../0 m/.../1 (external / internal chains)
| |
┌─┴─┐ ┌─┴─┐
0 1 0 1 ... (child addresses)
| | | |
addr addr addr addr (derived without private keys)
The xpub contains both a public key and a chain code, which together allow deterministic derivation of child keys. The corresponding extended private key (xprv) can derive private keys, but the xpub alone cannot.
Variants: ypub and zpub
Different address format standards introduced prefixed variants to indicate the derivation path and address type:
- xpub: Legacy addresses (BIP44, P2PKH) — addresses starting with
1 - ypub: Wrapped SegWit (BIP49, P2SH-P2WPKH) — addresses starting with
3 - zpub: Native SegWit (BIP84, P2WPKH) — addresses starting with
bc1q
These are functionally the same data structure with different version bytes, allowing wallet software to automatically determine which address format to generate.
Use Cases
- Watch-only wallets: Import an xpub to monitor a cold storage wallet's balance and generate receive addresses without exposing private keys.
- Payment processing: A merchant can share an xpub with their e-commerce platform to generate unique addresses for each customer payment.
- Accounting: Financial tools can import xpubs to track bitcoin holdings for tax or audit purposes.
Privacy Warning
An xpub reveals the complete transaction history and balance of all addresses in its derivation path. Anyone with an xpub can see every past and future transaction for that account. Treat xpubs as sensitive data:
- Never share an xpub publicly
- Only share with trusted services that require it
- Be aware that a service with your xpub can correlate all your addresses
Common Misconceptions
An xpub cannot be used to spend bitcoin. It enables address generation and balance monitoring only. However, if someone obtains both an xpub and a single child private key, they can potentially derive all other private keys in that derivation path — which is why hardened derivation is used for account-level keys.