An alphanumeric entity simply consists of both numbers and letters.

It could represent a combination of lower-case letters, upper-case letters, and numbers. The term is coined from the words “alphabet” referring to letters and “numeric” referring to numbers; however, alphanumeric entities can also contain special characters.

What are alphanumeric characters used in the cryptocurrency world?

The main uses of alphanumeric entities in the crypto space are for identification and security purposes.

Each wallet created is associated with a public address as well as a private key. The private key is a string of cryptographically-generated alphanumeric characters used to digitally sign the transfer of crypto assets from a wallet. The private key is represented in alphanumeric form to serve as a security measure as it cannot be easily memorized for malicious use. It is the one most crucial piece of information required to send cryptos from a wallet.

Public addresses are also made up of cryptographically-generated alphanumeric characters. They pose no security threats on their own; hence they simply are used to identify parties involved in a particular crypto transaction. Public addresses can be likened to e-mail identities. The receiver must provide their public wallet address before the sender can identify the correct wallet to transfer a particular crypto asset.

Many cryptocurrency exchanges and wallet service providers also require that an alphanumeric password is created as a security measure, preferably containing at least 8-characters and select special characters. This is so that passwords used to secure accounts (on exchanges and wallets) cannot easily be compromised.