diff --git a/.github/CODEOWNERS b/.github/CODEOWNERS
index 6804f455dc..c1fbad4b55 100644
--- a/.github/CODEOWNERS
+++ b/.github/CODEOWNERS
@@ -32,7 +32,9 @@
 /packages/jellyfish-transaction-signature/      @fuxingloh @ivan-zynesis
 /packages/jellyfish-wallet/                     @fuxingloh @ivan-zynesis @monstrobishi
 /packages/jellyfish-wallet-classic/             @fuxingloh @ivan-zynesis @monstrobishi
+/packages/jellyfish-wallet-encrypted/           @fuxingloh @ivan-zynesis
 /packages/jellyfish-wallet-mnemonic/            @fuxingloh @ivan-zynesis
+
 /packages/testcontainers/                       @fuxingloh
 /packages/testing/                              @fuxingloh @canonbrother
 
diff --git a/.github/governance.yml b/.github/governance.yml
index 1cd11245dd..3a97edc9b2 100644
--- a/.github/governance.yml
+++ b/.github/governance.yml
@@ -49,6 +49,7 @@ issue:
         - jellyfish-transaction-builder
         - jellyfish-transaction-signature
         - jellyfish-wallet
+        - jellyfish-wallet-encrypted
         - jellyfish-wallet-classic
         - jellyfish-wallet-mnemonic
         - testcontainers
diff --git a/.github/labeler.yml b/.github/labeler.yml
index de0a49cf5a..dd65e3e94c 100644
--- a/.github/labeler.yml
+++ b/.github/labeler.yml
@@ -61,6 +61,11 @@ labels:
     matcher:
       files: "packages/jellyfish-transaction-signature/**"
 
+  - label: area/jellyfish-wallet-encrypted
+    sync: true
+    matcher:
+      files: "packages/jellyfish-wallet-encrypted/**"
+
   - label: area/jellyfish-wallet-classic
     sync: true
     matcher:
diff --git a/.github/labels.yml b/.github/labels.yml
index e6513e7184..06e5365f46 100644
--- a/.github/labels.yml
+++ b/.github/labels.yml
@@ -80,6 +80,8 @@
   name: area/jellyfish-wallet
 - color: fbca04
   name: area/jellyfish-wallet-classic
+- color: fbca04
+  name: area/jellyfish-wallet-encrypted
 - color: fbca04
   name: area/jellyfish-wallet-mnemonic
 - color: fbca04
diff --git a/README.md b/README.md
index 429197b546..71e8769ef2 100644
--- a/README.md
+++ b/README.md
@@ -89,6 +89,7 @@ Package                                            | Description
 `@defichain/jellyfish-transaction-builder`         | Provides a high-high level abstraction for constructing transaction ready to be broadcast for DeFi Blockchain.
 `@defichain/jellyfish-wallet-classic`              | WalletClassic implements a simple, single elliptic pair wallet.
 `@defichain/jellyfish-wallet`                      | Jellyfish wallet is a managed wallet, where account can get discovered from an HD seed.
+`@defichain/jellyfish-wallet-encrypted`            | Library to encrypt MnemonicHdNode as EncryptedMnemonicHdNode. Able to perform as MnemonicHdNode with passphrase known. 
 `@defichain/jellyfish-wallet-mnemonic`             | MnemonicHdNode implements the WalletHdNode from jellyfish-wallet; a CoinType-agnostic HD Wallet for noncustodial DeFi.
 `@defichain/testcontainers`                        | Provides a lightweight, throw away instances for DeFiD node provisioned automatically in a Docker container.
 `@defichain/testing`                               | Provides rich test fixture setup functions for effective and effortless testing.
diff --git a/jest.config.js b/jest.config.js
index 29d4e380b1..7b8b314451 100644
--- a/jest.config.js
+++ b/jest.config.js
@@ -12,6 +12,7 @@ module.exports = {
     '@defichain/jellyfish-transaction-builder': '<rootDir>/packages/jellyfish-transaction-builder/src',
     '@defichain/jellyfish-transaction': '<rootDir>/packages/jellyfish-transaction/src',
     '@defichain/jellyfish-wallet-classic': '<rootDir>/packages/jellyfish-wallet-classic/src',
+    '@defichain/jellyfish-wallet-encrypted': '<rootDir>/packages/jellyfish-wallet-encrypted/src',
     '@defichain/jellyfish-wallet-mnemonic': '<rootDir>/packages/jellyfish-wallet-mnemonic/src',
     '@defichain/jellyfish-wallet': '<rootDir>/packages/jellyfish-wallet/src',
     '@defichain/testcontainers': '<rootDir>/packages/testcontainers/src',
diff --git a/package-lock.json b/package-lock.json
index d13bceb6fa..7ad4d8c8d7 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -1529,6 +1529,10 @@
       "resolved": "packages/jellyfish-wallet-classic",
       "link": true
     },
+    "node_modules/@defichain/jellyfish-wallet-encrypted": {
+      "resolved": "packages/jellyfish-wallet-encrypted",
+      "link": true
+    },
     "node_modules/@defichain/jellyfish-wallet-mnemonic": {
       "resolved": "packages/jellyfish-wallet-mnemonic",
       "link": true
@@ -13283,6 +13287,15 @@
         "@types/node": "*"
       }
     },
+    "node_modules/@types/scryptsy": {
+      "version": "2.0.0",
+      "resolved": "https://registry.npmjs.org/@types/scryptsy/-/scryptsy-2.0.0.tgz",
+      "integrity": "sha512-iDmneBKWSsmsR3SlGisOVnpCz7sB5Mqhv4I/pLg1DYq2zttWT65r+1gOVZtoxXiTsSf/JO8NhgyCKhx7cvGbaA==",
+      "dev": true,
+      "dependencies": {
+        "@types/node": "*"
+      }
+    },
     "node_modules/@types/stack-utils": {
       "version": "2.0.0",
       "dev": true,
@@ -26445,6 +26458,11 @@
         "node": ">=10"
       }
     },
+    "node_modules/scryptsy": {
+      "version": "2.1.0",
+      "resolved": "https://registry.npmjs.org/scryptsy/-/scryptsy-2.1.0.tgz",
+      "integrity": "sha512-1CdSqHQowJBnMAFyPEBRfqag/YP9OF394FV+4YREIJX4ljD7OxvQRDayyoyyCk+senRjSkP6VnUNQmVQqB6g7w=="
+    },
     "node_modules/semver": {
       "version": "7.3.4",
       "dev": true,
@@ -29541,6 +29559,7 @@
       }
     },
     "packages/jellyfish-wallet-classic": {
+      "name": "@defichain/jellyfish-wallet-classic",
       "version": "0.0.0",
       "license": "MIT",
       "dependencies": {
@@ -29548,6 +29567,19 @@
         "@defichain/jellyfish-wallet": "0.0.0"
       }
     },
+    "packages/jellyfish-wallet-encrypted": {
+      "name": "@defichain/jellyfish-wallet-encrypted",
+      "version": "0.0.0",
+      "license": "MIT",
+      "dependencies": {
+        "@defichain/jellyfish-crypto": "0.0.0",
+        "@defichain/jellyfish-wallet": "0.0.0",
+        "scryptsy": "^2.1.0"
+      },
+      "devDependencies": {
+        "@types/scryptsy": "^2.0.0"
+      }
+    },
     "packages/jellyfish-wallet-mnemonic": {
       "name": "@defichain/jellyfish-wallet-mnemonic",
       "version": "0.0.0",
@@ -30831,6 +30863,15 @@
         "@defichain/jellyfish-wallet": "0.0.0"
       }
     },
+    "@defichain/jellyfish-wallet-encrypted": {
+      "version": "file:packages/jellyfish-wallet-encrypted",
+      "requires": {
+        "@defichain/jellyfish-crypto": "0.0.0",
+        "@defichain/jellyfish-wallet": "0.0.0",
+        "@types/scryptsy": "^2.0.0",
+        "scryptsy": "^2.1.0"
+      }
+    },
     "@defichain/jellyfish-wallet-mnemonic": {
       "version": "file:packages/jellyfish-wallet-mnemonic",
       "requires": {
@@ -40225,6 +40266,15 @@
         "@types/node": "*"
       }
     },
+    "@types/scryptsy": {
+      "version": "2.0.0",
+      "resolved": "https://registry.npmjs.org/@types/scryptsy/-/scryptsy-2.0.0.tgz",
+      "integrity": "sha512-iDmneBKWSsmsR3SlGisOVnpCz7sB5Mqhv4I/pLg1DYq2zttWT65r+1gOVZtoxXiTsSf/JO8NhgyCKhx7cvGbaA==",
+      "dev": true,
+      "requires": {
+        "@types/node": "*"
+      }
+    },
     "@types/stack-utils": {
       "version": "2.0.0",
       "dev": true
@@ -49710,6 +49760,11 @@
         "xmlchars": "^2.2.0"
       }
     },
+    "scryptsy": {
+      "version": "2.1.0",
+      "resolved": "https://registry.npmjs.org/scryptsy/-/scryptsy-2.1.0.tgz",
+      "integrity": "sha512-1CdSqHQowJBnMAFyPEBRfqag/YP9OF394FV+4YREIJX4ljD7OxvQRDayyoyyCk+senRjSkP6VnUNQmVQqB6g7w=="
+    },
     "semver": {
       "version": "7.3.4",
       "dev": true,
diff --git a/packages/jellyfish-wallet-encrypted/README.md b/packages/jellyfish-wallet-encrypted/README.md
new file mode 100644
index 0000000000..695414c765
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/README.md
@@ -0,0 +1,7 @@
+[![npm](https://img.shields.io/npm/v/@defichain/jellyfish-wallet-encrypted)](https://www.npmjs.com/package/@defichain/jellyfish-wallet-encrypted/v/latest)
+[![npm@next](https://img.shields.io/npm/v/@defichain/jellyfish-wallet-encrypted/next)](https://www.npmjs.com/package/@defichain/jellyfish-wallet-encrypted/v/next)
+
+# @defichain/jellyfish-wallet-encrypted
+
+This is an extended wallet hd node which has similar interface as @defichain/jellyfish-wallet-mnemonic. The library assists caller to encrypt mnemonic seed into provided storage. See example/demo.ts for more detail.
+
diff --git a/packages/jellyfish-wallet-encrypted/__tests__/scrypt-storage.test.ts b/packages/jellyfish-wallet-encrypted/__tests__/scrypt-storage.test.ts
new file mode 100644
index 0000000000..6547ddf363
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/__tests__/scrypt-storage.test.ts
@@ -0,0 +1,100 @@
+import { ScryptStorage, Storage, SimpleScryptsy } from '../src'
+
+class MockStorage implements Storage {
+  inMemory: string | undefined
+  async getter (): Promise<string|undefined> {
+    return this.inMemory
+  }
+
+  async setter (encrypted: string | undefined): Promise<void> {
+    this.inMemory = encrypted
+  }
+}
+// Mock storage
+let scryptStorage: ScryptStorage
+const encryptedSeedStorage = new MockStorage()
+const seedHashStorage = new MockStorage()
+
+const scryptProvider = new SimpleScryptsy()
+
+// 32 bytes
+const samplePrivateKey = 'e9873d79c6d87dc0fb6a5778633389f4e93213303da61f20bd67fc233aa33262'
+
+beforeEach(async () => {
+  scryptStorage = new ScryptStorage(scryptProvider, encryptedSeedStorage, seedHashStorage)
+  await encryptedSeedStorage.setter(undefined)
+  await seedHashStorage.setter(undefined)
+})
+
+it('Should be able to encrypt / decrypt', async () => {
+  const pass = 'password'
+
+  const privateKey = Buffer.from(samplePrivateKey, 'hex')
+  await scryptStorage.encrypt(privateKey, pass)
+
+  // encrypted data stored
+  expect(await encryptedSeedStorage.getter()).not.toStrictEqual(null)
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted?.toString('hex')).toStrictEqual(samplePrivateKey)
+})
+
+it('Should be able to encrypt / decrypt - simple passphrase', async () => {
+  // let say a 6 digit pin
+  const pass = '135790'
+
+  const privateKey = Buffer.from(samplePrivateKey, 'hex')
+  await scryptStorage.encrypt(privateKey, pass)
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted?.toString('hex')).toStrictEqual(samplePrivateKey)
+})
+
+it('decrypt() - should return null when no data in storage', async () => {
+  // let say a 6 digit pin
+  const pass = 'password'
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted).toStrictEqual(null)
+})
+
+it('Should work with variable data length - long', async () => {
+  const longData = samplePrivateKey + samplePrivateKey + samplePrivateKey + samplePrivateKey
+  const pass = 'password'
+
+  const data = Buffer.from(longData, 'hex')
+  await scryptStorage.encrypt(data, pass)
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted?.toString('hex')).toStrictEqual(longData)
+})
+
+it('Should work with variable data length - short', async () => {
+  const shortData = 'ffaa'
+  const pass = 'password'
+
+  const data = Buffer.from(shortData, 'hex')
+  await scryptStorage.encrypt(data, pass)
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted?.toString('hex')).toStrictEqual(shortData)
+})
+
+it('Should reject "odd" number long data, only accept "even" number long data', async () => {
+  const pass = 'password'
+
+  const fourBytes = 'eeffaabb'
+  await scryptStorage.encrypt(Buffer.from(fourBytes, 'hex'), pass)
+
+  const threeBytes = 'ffaabb'
+  const data = Buffer.from(threeBytes, 'hex')
+  await expect(async () => {
+    await scryptStorage.encrypt(data, pass)
+  }).rejects.toThrow('Data length must be even number')
+
+  const padded = Buffer.from('00' + threeBytes, 'hex')
+  await scryptStorage.encrypt(padded, pass)
+
+  const decrypted = await scryptStorage.decrypt(pass)
+  expect(decrypted?.toString('hex')).toStrictEqual(padded.toString('hex'))
+})
diff --git a/packages/jellyfish-wallet-encrypted/__tests__/scryptsy.test.ts b/packages/jellyfish-wallet-encrypted/__tests__/scryptsy.test.ts
new file mode 100644
index 0000000000..ea29f0bd8b
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/__tests__/scryptsy.test.ts
@@ -0,0 +1,38 @@
+import { SimpleScryptsy } from '../src'
+
+describe('passphraseToKey()', () => {
+  it('Should be able to generate from random (same) passphrase into multiple desired length secret', () => {
+    const scryptsy = new SimpleScryptsy()
+    const secret1 = scryptsy.passphraseToKey('random password', Buffer.from('abcd', 'hex'), 64)
+    expect(secret1.length).toStrictEqual(64)
+
+    const secret2 = scryptsy.passphraseToKey('random password', Buffer.from('abcd', 'hex'), 40)
+    expect(secret2.length).toStrictEqual(40)
+  })
+
+  it('Configurable params (difficulty)', () => {
+    const easy = new SimpleScryptsy({
+      N: 16384, // 2 ^ 14
+      r: 8,
+      p: 1
+    })
+
+    const hard = new SimpleScryptsy({
+      N: 16384, // 2 ^ 14
+      r: 8,
+      p: 8
+    })
+
+    const easyStart = Date.now()
+    easy.passphraseToKey('random password', Buffer.from('abcd', 'hex'), 32)
+    const easyTime = Date.now() - easyStart
+
+    const hardStart = Date.now()
+    hard.passphraseToKey('random password', Buffer.from('abcd', 'hex'), 32)
+    const hardTime = Date.now() - hardStart
+
+    // significantly slower
+    // technically it is 8x harder, but they can be processed in parallel
+    expect(hardTime).toBeGreaterThan(easyTime * 2)
+  })
+})
diff --git a/packages/jellyfish-wallet-encrypted/jest.config.js b/packages/jellyfish-wallet-encrypted/jest.config.js
new file mode 100644
index 0000000000..11d9802ff4
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/jest.config.js
@@ -0,0 +1,12 @@
+module.exports = {
+  testEnvironment: 'node',
+  testMatch: [
+    '**/__tests__/**/*.test.ts'
+  ],
+  transform: {
+    '^.+\\.ts$': 'ts-jest'
+  },
+  verbose: true,
+  clearMocks: true,
+  testTimeout: 120000
+}
diff --git a/packages/jellyfish-wallet-encrypted/package.json b/packages/jellyfish-wallet-encrypted/package.json
new file mode 100644
index 0000000000..7d1b042adf
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/package.json
@@ -0,0 +1,45 @@
+{
+  "private": false,
+  "name": "@defichain/jellyfish-wallet-encrypted",
+  "version": "0.0.0",
+  "description": "A collection of TypeScript + JavaScript tools and libraries for DeFi Blockchain developers to build decentralized finance on Bitcoin",
+  "keywords": [
+    "DeFiChain",
+    "DeFi",
+    "Blockchain",
+    "API",
+    "Bitcoin"
+  ],
+  "repository": "DeFiCh/jellyfish",
+  "bugs": "https://github.com/DeFiCh/jellyfish/issues",
+  "license": "MIT",
+  "contributors": [
+    {
+      "name": "DeFiChain Foundation",
+      "email": "engineering@defichain.com",
+      "url": "https://defichain.com/"
+    },
+    {
+      "name": "DeFi Blockchain Contributors"
+    },
+    {
+      "name": "DeFi Jellyfish Contributors"
+    }
+  ],
+  "main": "dist/index.js",
+  "types": "dist/index.d.ts",
+  "files": [
+    "dist"
+  ],
+  "scripts": {
+    "build": "tsc -b ./tsconfig.build.json"
+  },
+  "dependencies": {
+    "@defichain/jellyfish-crypto": "0.0.0",
+    "@defichain/jellyfish-wallet": "0.0.0",
+    "scryptsy": "^2.1.0"
+  },
+  "devDependencies": {
+    "@types/scryptsy": "^2.0.0"
+  }
+}
diff --git a/packages/jellyfish-wallet-encrypted/src/index.ts b/packages/jellyfish-wallet-encrypted/src/index.ts
new file mode 100644
index 0000000000..d4ab38bfce
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/src/index.ts
@@ -0,0 +1,2 @@
+export * from './scryptsy'
+export * from './scrypt_storage'
diff --git a/packages/jellyfish-wallet-encrypted/src/scrypt_storage.ts b/packages/jellyfish-wallet-encrypted/src/scrypt_storage.ts
new file mode 100644
index 0000000000..9d4cb168b2
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/src/scrypt_storage.ts
@@ -0,0 +1,165 @@
+import { dSHA256, AES256 } from '@defichain/jellyfish-crypto'
+
+export interface ScryptProvider {
+  passphraseToKey: (nfcUtf8: string, salt: Buffer, desiredKeyLen: number) => Buffer
+}
+
+export type InitVectorProvider = () => Buffer
+
+export interface Storage {
+  getter: () => Promise<string | undefined>
+  setter: (encrypted: string | undefined) => Promise<void>
+}
+
+export class EncryptedData {
+  constructor (
+    // total = 7 + 2n bytes
+    readonly prefix: number, // 0x01
+    readonly type: number, // 0x42 or 0x43 (only 0x42 for now)
+    readonly flags: number, // 1 byte (only true for 2 most significant bit for now)
+    readonly hash: Buffer, // 4 bytes, checksum and salt
+    readonly encryptedFirstHalf: Buffer, // n bytes
+    readonly encryptedSecondHalf: Buffer // n bytes
+  ) {
+    this.prefix = prefix
+    this.type = type
+    this.flags = flags
+    this.hash = hash
+    this.encryptedFirstHalf = encryptedFirstHalf
+    this.encryptedSecondHalf = encryptedSecondHalf
+
+    if (encryptedFirstHalf.length !== encryptedSecondHalf.length) {
+      throw new Error('Unxpected data size, first and second half should have same length')
+    }
+  }
+
+  encode (): string {
+    const first3Bytes = Buffer.from([this.prefix, this.type, this.flags]).toString('hex')
+    const full = first3Bytes + this.hash.toString('hex') + this.encryptedFirstHalf.toString('hex') + this.encryptedSecondHalf.toString('hex')
+    return full
+  }
+
+  static decode (encoded: string): EncryptedData {
+    if (encoded.length < 18) { // min length is 9 bytes
+      throw new Error('Invalid encrypted data')
+    }
+
+    const dataLen = encoded.length - 14
+    if (dataLen % 2 !== 0) {
+      throw new Error('Invalid encrypted data')
+    }
+
+    const firstHalfEndIndex = 14 + (dataLen / 2)
+    return new EncryptedData(
+      Number(encoded.slice(0, 2)),
+      Number(encoded.slice(2, 4)),
+      Number(encoded.slice(4, 6)),
+      Buffer.from(encoded.slice(6, 14), 'hex'),
+      Buffer.from(encoded.slice(14, firstHalfEndIndex), 'hex'),
+      Buffer.from(encoded.slice(firstHalfEndIndex), 'hex')
+    )
+  }
+}
+
+export class ScryptStorage {
+  /**
+   * @param {ScryptProvider} scryptProvider to convert a utf8 string into a secret, cryptographically secured
+   * @param {Storage} encryptedStorage to store encrypted data
+   * @param {Storage} hashStorage to store hash of the data, for passphrase verification use
+   * @param {InitVectorProvider} ivProvider `() => Buffer` as AES encryption iv randomizer, default = `crypto-js.randomBytes`
+   */
+  constructor (
+    readonly scryptProvider: ScryptProvider,
+    readonly encryptedStorage: Storage,
+    readonly hashStorage: Storage,
+    readonly ivProvider?: InitVectorProvider
+  ) {
+    this.scryptProvider = scryptProvider
+    this.encryptedStorage = encryptedStorage
+    this.hashStorage = hashStorage
+    this.ivProvider = ivProvider
+  }
+
+  /**
+   * To encrypt `data` with a `passphrase` derived secret (derivation based on provided `ScryptProvider`)
+   * @see https://github.com/bitcoin/bips/blob/master/bip-0038.mediawiki#Encryption_when_EC_multiply_flag_is_not_used for encryption methodology
+   *
+   * @param {Buffer} data data with even number length
+   * @param {string} passphrase to derived encryption secret, utf8 string in normalization format C
+   */
+  async encrypt (data: Buffer, passphrase: string): Promise<void> {
+    if (data.length % 2 !== 0) {
+      throw new Error('Data length must be even number')
+    }
+
+    const hash = dSHA256(data).slice(0, 4)
+    const key = this.scryptProvider.passphraseToKey(passphrase, hash, 64)
+
+    const k1a = Buffer.from(key.toString('hex').slice(0, 32), 'hex') // 16 bytes
+    const k1b = Buffer.from(key.toString('hex').slice(32, 64), 'hex') // 16 bytes
+    const k2 = Buffer.from(key.toString('hex').slice(64), 'hex') // 32 bytes
+
+    const d1 = Buffer.from(data.toString('hex').slice(0, data.length), 'hex')
+    const d2 = Buffer.from(data.toString('hex').slice(data.length), 'hex')
+
+    const xor1 = this._xor(k1a, d1)
+    const xor2 = this._xor(k1b, d2)
+
+    const b1 = AES256.encrypt(k2, xor1, this.ivProvider)
+    const b2 = AES256.encrypt(k2, xor2, this.ivProvider)
+
+    const encrypted = new EncryptedData(0x01, 0x42, 0xc0, hash, b1, b2)
+    await this.encryptedStorage.setter(encrypted.encode())
+
+    const dataHash = dSHA256(data).slice(0, 4)
+    await this.hashStorage.setter(dataHash.toString('hex'))
+  }
+
+  /**
+   * To decrypt raw data
+   * @param {string} passphrase to decrypted data, utf8 string in normalization format C
+   * @returns {Promise<Buffer|null>} null if no data found in storage
+   */
+  async decrypt (passphrase: string): Promise<Buffer|null> {
+    const encrypted = await this.encryptedStorage.getter()
+
+    if (encrypted === undefined) {
+      return null
+    }
+
+    const data = EncryptedData.decode(encrypted)
+    const key = this.scryptProvider.passphraseToKey(passphrase, data.hash, 64)
+
+    const k1a = Buffer.from(key.toString('hex').slice(0, 32), 'hex') // 16 bytes
+    const k1b = Buffer.from(key.toString('hex').slice(32, 64), 'hex') // 16 bytes
+    const k2 = Buffer.from(key.toString('hex').slice(64), 'hex') // 32 bytes
+
+    const dec1 = AES256.decrypt(k2, data.encryptedFirstHalf) // 16 bytes = decipher(32 bytes) - salt
+    const dec2 = AES256.decrypt(k2, data.encryptedSecondHalf)
+
+    const d1 = this._xor(k1a, dec1)
+    const d2 = this._xor(k1b, dec2)
+    const decrypted = Buffer.from([...d1, ...d2])
+
+    const dataHash = dSHA256(decrypted).slice(0, 4)
+    const expected = await this.hashStorage.getter()
+    if (dataHash.toString('hex') !== expected) {
+      throw new Error('InvalidPassphrase')
+    }
+
+    return decrypted
+  }
+
+  private _xor (key: Buffer, data: Buffer): Buffer {
+    const output = Buffer.alloc(data.length)
+    for (let i = 0, j = 0; i < data.length && i < data.length; i++) {
+      output[i] = data[i] ^ key[j]
+      if (j + 1 === data.length) {
+        j = 0
+      } else {
+        j++
+      }
+    }
+    return output
+  }
+}
diff --git a/packages/jellyfish-wallet-encrypted/src/scryptsy.ts b/packages/jellyfish-wallet-encrypted/src/scryptsy.ts
new file mode 100644
index 0000000000..825b3fa36e
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/src/scryptsy.ts
@@ -0,0 +1,46 @@
+import scrypt from 'scryptsy'
+import { ScryptProvider } from './scrypt_storage'
+
+export interface ScryptParams {
+  N: number
+  r: number
+  p: number
+}
+
+const DEFAULT_SCRYPT_PARAMS: ScryptParams = {
+  N: 16384,
+  r: 8,
+  p: 8
+}
+
+/**
+ * A simple ScryptProvider implementation using
+ * {@link https://www.npmjs.com/package/scryptsy} (Javascript implementation of the scrypt key derivation)
+ *
+ * Mainly for testing and prototyping purpose, required for {@link EncryptedMnemonicProvider} instantiation
+ * Scrypty library may not compatible with other platforms, eg: react-native
+ */
+export class SimpleScryptsy implements ScryptProvider {
+  constructor (private readonly scryptParams: ScryptParams = DEFAULT_SCRYPT_PARAMS) {}
+
+  /**
+   * Derive a specific length buffer via Scrypt implementation
+   * Recommended (by bip38) to serve as an private key encryption key
+   *
+   * @param {string} passphrase utf8 string
+   * @param {Buffer} salt
+   * @param {number} keyLength desired output buffer length
+   * @returns {Buffer}
+   */
+  passphraseToKey (passphrase: string, salt: Buffer, keyLength: number): Buffer {
+    const secret = Buffer.from(passphrase.normalize('NFC'), 'utf8')
+    return scrypt(
+      secret,
+      salt,
+      this.scryptParams.N,
+      this.scryptParams.r,
+      this.scryptParams.p,
+      keyLength
+    )
+  }
+}
diff --git a/packages/jellyfish-wallet-encrypted/tsconfig.build.json b/packages/jellyfish-wallet-encrypted/tsconfig.build.json
new file mode 100644
index 0000000000..d4e0fc2696
--- /dev/null
+++ b/packages/jellyfish-wallet-encrypted/tsconfig.build.json
@@ -0,0 +1,15 @@
+{
+  "extends": "../../tsconfig.build.json",
+  "include": [
+    "./src/**/*"
+  ],
+  "compilerOptions": {
+    "outDir": "./dist",
+    "rootDir": "./src",
+  },
+  "references": [
+    {"path": "../jellyfish-crypto/tsconfig.build.json"},
+    {"path": "../jellyfish-wallet/tsconfig.build.json"},
+    {"path": "../jellyfish-wallet-mnemonic/tsconfig.build.json"}
+  ]
+}
diff --git a/tsconfig.build.json b/tsconfig.build.json
index a044af1438..45bbdb3a38 100644
--- a/tsconfig.build.json
+++ b/tsconfig.build.json
@@ -19,6 +19,7 @@
     {"path": "./packages/jellyfish-transaction-signature/tsconfig.build.json"},
     {"path": "./packages/jellyfish-wallet/tsconfig.build.json"},
     {"path": "./packages/jellyfish-wallet-classic/tsconfig.build.json"},
+    {"path": "./packages/jellyfish-wallet-encrypted/tsconfig.build.json"},
     {"path": "./packages/jellyfish-wallet-mnemonic/tsconfig.build.json"},
     {"path": "./packages/testcontainers/tsconfig.build.json"},
     {"path": "./packages/testing/tsconfig.build.json"}
diff --git a/tsconfig.json b/tsconfig.json
index 8a55a200bc..1ac46d6c1a 100644
--- a/tsconfig.json
+++ b/tsconfig.json
@@ -14,6 +14,7 @@
       "@defichain/jellyfish-transaction-signature": ["jellyfish-transaction-signature/src"],
       "@defichain/jellyfish-wallet": ["jellyfish-wallet/src"],
       "@defichain/jellyfish-wallet-classic": ["jellyfish-wallet-classic/src"],
+      "@defichain/jellyfish-wallet-encrypted": ["jellyfish-wallet-encrypted/src"],
       "@defichain/jellyfish-wallet-mnemonic": ["jellyfish-wallet-mnemonic/src"],
       "@defichain/testcontainers": ["testcontainers/src"],
       "@defichain/testing": ["testing/src"],
@@ -29,6 +30,7 @@
       "@defichain/jellyfish-transaction-signature/*": ["jellyfish-transaction-signature/src/*"],
       "@defichain/jellyfish-wallet/*": ["jellyfish-wallet/src/*"],
       "@defichain/jellyfish-wallet-classic/*": ["jellyfish-wallet-classic/src/*"],
+      "@defichain/jellyfish-wallet-encrypted/*": ["jellyfish-wallet-encrypted/src/*"],
       "@defichain/jellyfish-wallet-mnemonic/*": ["jellyfish-wallet-mnemonic/src/*"],
       "@defichain/testcontainers/*": ["testcontainers/src/*"],
       "@defichain/testing/*": ["testing/src/*"],
diff --git a/website/docs/introduction.md b/website/docs/introduction.md
index 9be68bf7db..5da403bbc6 100644
--- a/website/docs/introduction.md
+++ b/website/docs/introduction.md
@@ -39,6 +39,7 @@ Package                                            | Description
 `@defichain/jellyfish-transaction-signature`       | Stateless utility library to perform transaction signing.
 `@defichain/jellyfish-wallet`                      | Jellyfish wallet is a managed wallet, where account can get discovered from an HD seed.
 `@defichain/jellyfish-wallet-classic`              | WalletClassic implements a simple, single elliptic pair wallet.
+`@defichain/jellyfish-wallet-encrypted`            | Library to encrypt MnemonicHdNode as EncryptedMnemonicHdNode. Able to perform as MnemonicHdNode with passphrase known.
 `@defichain/jellyfish-wallet-mnemonic`             | MnemonicHdNode implements the WalletHdNode from jellyfish-wallet; a CoinType-agnostic HD Wallet for noncustodial DeFi.
 `@defichain/testcontainers`                        | Provides a lightweight, throw away instances for DeFiD node provisioned automatically in a Docker container.
 `@defichain/testing`                               | Provides rich test fixture setup functions for effective and effortless testing.