In terms of a site's SEO, is the following format best:
Or can a website do just as well SEO-wise if it has URLs like this?
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Yes it matters if it's human readable. It's a minor ranking factor. It probably won't make or break you, but, think of it like doing an extra credit question on a quiz. You'll get a few bonus points for it.
There are two areas it matters. The first is initial rankings. If you have human keywords in your url you will rank higher than an exact duplicate of the site with a long seemingly random url. If you've ever seen the seo table of elements urls are on there. If you google search a term on desktop if the search term is in the url, that term will be bolded. That means Google considers it to be a ranking factor for the term.