Why memos exist
Why exchanges need one
An exchange with millions of users does not create a separate blockchain address for each of them. It uses one address per asset and identifies the recipient by the memo.
The transfer arrives at the exchange’s address. The exchange reads the memo, matches it to your account, and credits you. Without the memo the funds are at the exchange with nothing indicating whose they are.
This is a design choice about scale rather than a property of the network. A personal wallet needs no memo, because the address already identifies exactly one recipient.
Which networks use them
The requirement belongs to the chain rather than to the exchange, though the exchange decides whether to use it.
XRP calls it a destination tag, a number. Stellar and Cosmos call it a memo. TON calls it a comment, and exchange deposits there frequently need one. Algorand uses a note field.
Networks that do not use memos include Bitcoin, Ethereum and everything else in the EVM family, TRON, Solana and Litecoin. On these chains an exchange generates a unique deposit address per user instead, which is why most people never encounter a memo at all.
What happens if you forget one
The transfer confirms. The blockchain considers it complete, and the transaction hash resolves normally. The problem is entirely on the receiving side.
At an exchange
The funds sit in the exchange’s wallet, unassigned.
What to send to support
The transaction hash, the sending address, the deposit address you used and the amount. Recovery takes days to weeks, many exchanges charge a fee for the manual work, and some decline to look at small amounts at all.
At a personal wallet
Nothing happens, because no memo was needed. The funds are credited normally.
Which direction is expensive
Sending a memo where none is required is harmless. Omitting one where it is required is the expensive direction, which makes the safe habit obvious: include it whenever the recipient provides it.
The routine that prevents this
Three steps, and they take longer to read than to do.
Copy the memo separately from the address. Wallets keep them in different fields, and copying only the address is the most common version of this mistake.
Check whether the recipient asked for one. Exchange deposit screens display it prominently, usually with a warning.
Send a small test amount first when the transfer is large. The funding guide covers the wider set of checks worth running.
Why merchants do not use memos
A payment gateway generates a fresh address for each order, which solves the same problem the memo solves and solves it better.
The order is identified by its address, so nothing depends on the customer entering an extra field correctly. That removes an entire class of support ticket, and it is one reason the per-order address is the standard arrangement rather than a nicety. The setup guide describes the flow.