The role of "MEMO" in cryptocurrency transactions

The Memo, also referred to as a tag or destination identifier, is a crucial alphanumeric code in certain cryptocurrency networks. Its primary function is to uniquely identify the recipient or associate a transaction with a specific account within an exchange platform.

Why is the Memo necessary?

Some cryptocurrencies, such as XRP, XLM, or BNB, allow multiple users to share the same wallet address on exchange platforms. To distinguish between these users, a Memo or tag is added to each transaction.

The omission of the correct Memo may result in the platform being unable to identify the recipient, which could lead to the loss of funds or require complex procedures for recovery.

Use cases of the Memo

The Memo is mainly used when sending cryptocurrencies to centralized exchanges like Gate. It is mandatory in certain cases for specific networks and coins, such as:

• XRP: Requires a tag.
• XLM: Needs a Memo.
• BNB on the BNB Chain: Use Memo.
• EOS: Use Memo or destination identifier.

Location of the Memo

In your exchange account:

When selecting the option to deposit a coin such as XRP, XLM, or BNB, the platform will display the deposit address along with a unique Memo or tag.

For example: Address: rDIRECCIONEJEMPLO987654 Memo/Label: 87654321

In the withdrawal section:

When transferring funds from an exchange, you will find a specific field to enter the Memo, in addition to the destination address.

Confirmation in external wallets:

Some wallets, like Trust Wallet or Ledger Live, will also indicate if it is necessary to add a Memo when sending funds.

Practical example

Let's imagine that you want to send XRP from Gate to another exchange. The process would be as follows:

1. Access your account on the destination exchange and select "Deposit XRP".
2. The platform will provide you with two pieces of data:
   • Deposit address
   • Tag/Memo ( for example: 87654321)
3. When making the withdrawal from Gate, copy both data (address and Memo) and enter them in the corresponding fields.

Consequences of omitting the Memo

If you forget to enter the Memo or tag:

• The transaction will be sent, but the exchange will not be able to identify the recipient.
• You should contact the support of the exchange to try to recover the funds.
• This process is usually complex and does not always guarantee recovery.

It is essential to remember that the Memo is crucial for transactions with coins like XRP, XLM, and BNB when sending them to centralized exchanges.