What is MEMO, Destination Tag, Comment in crypto

What Is a Memo?

A memo (also known as a memo tag or tag memo) is an additional field displayed when sending funds in certain cryptocurrency projects. Essentially, it’s an identifier that helps accurately designate the recipient of a payment, especially when using centralized exchanges and services.

In cryptocurrencies, a memo can be compared to a note or private message that helps systems understand who is sending funds and why. The memo tag is used in cryptocurrencies that support multi-user wallet addresses.

Unlike traditional bank transfers that use account numbers, in crypto it’s common for a single wallet address to serve many users. That’s where the memo helps the system determine exactly who the payment is for. This is especially important when working with centralized platforms, where accurate recipient identification is crucial for successful transactions.

The tag memo functions as a sort of “internal address” within a main wallet. It ensures precise distribution of funds among users. A memo tag in cryptocurrencies guarantees that the funds reach the correct recipient.

Why Is a Destination Tag Needed for Transactions?

The main reason for using a destination tag or memo is the need to properly identify the recipient on platforms that handle high volumes of incoming payments. Large exchanges and payment systems often rely on a limited number of “hot” and “cold” wallets to store user funds.

For example, when placing an order on a platform, a user selects the cryptocurrency for payment. After choosing a payment method, such as USDT on the TON network, the next step is receiving payment details. The system generates a payment address and tag, after which the user proceeds with the transfer. The user then copies the details into their wallet and confirms the transaction.

Without the tag, the platform won’t be able to determine who sent the funds. This is what makes the memo an essential tool for the proper functioning of transaction processing systems. The memo helps avoid confusion and ensures the correct crediting of funds.

Using a memo when sending crypto also helps prevent fund loss. The tag enables quick identification of payments when processing large volumes of transactions.

Cryptocurrencies That Use Memos

Here are several popular cryptocurrencies that use the memo system.

The TON blockchain, developed by the Telegram team, is one of the modern solutions for decentralized applications and e-commerce. In the TON blockchain, the tag plays a key role in transactions.

Take CryptoCloud as an example — a platform for accepting payments in TON. It generates payment links with unique identifiers. This simplifies integration and protects against DDoS attacks.

TON offers several advantages:

• Low transaction fees;
• High transaction speeds;
• Rich developer functionality;
• Support for smart contracts, making it attractive for various applications.

Stellar (XLM) is another popular platform that uses memos for transactions. It enables fast and inexpensive transfers of digital assets, with the memo helping to correctly identify recipients.

Binance Coin (BNB) is the native asset of the Binance platform, one of the largest centralized exchanges. It actively uses memo tags within its ecosystem. When sending assets to a Binance wallet, a memo is often required to ensure the funds reach the intended account.

Ripple (XRP) also uses a memo tag system to identify recipients. This enables efficient and secure processing of crypto payments, especially in high-volume transactions.

Frequently Asked Questions

How do I find the XRP destination tag in Trust Wallet?

To locate the XRP memo tag in Trust Wallet, follow these steps:

1. Open the Trust Wallet app.
2. Select XRP from your list of cryptocurrencies.
3. Tap the “Receive” button.

After these steps, your wallet address and tag will be displayed. Both must be provided to the sender for the funds to be delivered correctly.

How do I find the XRP memo tag on Binance?

To locate the memo tag for XRP on Binance:

1. Log in to your Binance account.
2. Go to the “Wallet” section, then choose “Deposit.”
3. Select XRP from the list of cryptocurrencies.

The system will display the deposit address and memo. You need to share both with the sender to ensure proper crediting of funds.

What happens if I send XRP without a destination tag?

If you send XRP to an exchange or service that requires a memo but fail to include it, the funds may:

• Not reach the recipient;
• Get stuck in a pending state;
• Require additional verification and a lengthy recovery process.

Recovering funds sent without the required tag can take time and is not always guaranteed. Some platforms may charge an extra fee for manual recovery of such transactions.

In cryptocurrency transfers, a memo is not just an optional fi