Bitcoin glossary
356 terms, defined in plain English by people who spend their days comparing exchanges and wallets rather than writing consensus code.
The starting point was the Bitcoin Core developer glossary, which covers 148 terms and has barely moved since 2021. Every one of those is here, rewritten from scratch, and the ones that went stale are corrected rather than repeated: BIP70 is dead, blocks are not capped at 1 MB, and replace-by-fee is no longer opt-in. On top of that sit the words that glossary never had, the ones people actually type into a search box before their first purchase. Seed phrase. sat/vB. Spot ETF. Travel Rule. Cold storage.
Each entry opens with a one sentence definition, explains the mechanism, and, where it changes a real decision, says what it means for your money. Figures are sourced and dated. Nothing here is investment advice.
Last reviewed 2026-08-13.
356 terms shown
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- 1 addressLegacy address
- 21 million21 million supply cap
- 21 million supply capBasicsThe 21 million supply cap is bitcoin's permanent ceiling on how many coins can ever exist, enforced by every node through a halving schedule no participant can override.
- 25th wordPassphrase
- 2FATwo-factor authentication
- 3 addressNested SegWit
- 51 percent attack51% attack
- 51% attackPrivacy & securityA 51% attack is an attempt to rewrite recent bitcoin history by controlling most of the network's mining power, letting the attacker reverse their own recent payments.
A
- AddressBitcoin address
- Address poisoningPrivacy & securityAddress poisoning is a theft trick where a scammer sends you a worthless transaction from an address that mimics one you already use, hoping you copy theirs from your history.
- Address reuseAddresses & keysAddress reuse means accepting more than one payment at the same bitcoin address, which publishes a permanent public link between everyone who has ever paid you there.
- Address spoofingAddress poisoning
- Address whitelistWithdrawal whitelist
- Air gapAir-gapped
- Air-gappedWallets & custodyAir-gapped describes a signing device that has never been connected to a network or a computer: transactions reach it only as files on a card or as scanned QR codes.
- AltcoinCulture & historyAltcoin means any cryptocurrency that is not bitcoin, from Namecoin in 2011 to the thousands of tokens launched since, each with its own rules, team, and failure modes.
- AMLAnti-Money Laundering
- Ancestor miningChild pays for parent
- Anti-Money LaunderingRegulation & taxAnti-Money Laundering rules are the obligations a country puts on exchanges to detect and report suspicious activity, and they are why a platform can freeze your withdrawal without warning.
- Application-specific integrated circuitASIC
- Archival nodeNode
- ArkLightning & layer 2Ark lets you receive bitcoin off chain without opening a channel, by giving you a share of a large shared output that expires unless you refresh it.
- ASICMining & consensusAn ASIC is a chip built to do one job, and in bitcoin that job is guessing SHA-256 hashes, which it does thousands of times faster per watt than any general purpose computer.
- Atomic swapLightning & layer 2An atomic swap trades coins on two different blockchains in a single all-or-nothing operation, enforced by matching hash locks and timelocks rather than by an exchange holding both sides.
- Auto-buyRecurring buy
B
- Backup phraseSeed phrase
- Bare multisigMultisig
- Base58Base58Check
- Base58CheckAddresses & keysBase58Check is bitcoin's original text encoding, which turns binary data into a string of 58 easily transcribed characters and appends a four byte checksum to catch typos.
- bc1p addressP2TR
- bc1q addressP2WPKH
- Bear marketMarkets & investingBear markets are the long stretches when bitcoin's price falls and stays down, and they are when the businesses holding other people's coins tend to break.
- Bech32Addresses & keysBech32 is the address encoding behind bc1q strings, a lowercase base32 format whose six-character checksum detects any error affecting up to four characters.
- Bech32mAddresses & keysBech32m fixes a flaw in bech32 by changing one constant in the checksum, and every Taproot address starting bc1p uses it instead of the original encoding.
- Best block chainBlockchain
- Best header chainHeader chain
- Bid-ask spreadBuying & exchangesThe bid-ask spread is the gap between the highest price a buyer will pay and the lowest price a seller will accept, and you pay half of it every time you cross.
- BIPBitcoin Improvement Proposal
- BIP-39BIP39
- BIP112OP_CHECKSEQUENCEVERIFY
- BIP119OP_CHECKTEMPLATEVERIFY
- BIP141SegWit
- BIP152Compact block relay
- BIP157Neutrino
- BIP174PSBT
- BIP21Bitcoin URI
- BIP300Drivechain
- BIP32HD wallet
- BIP340Schnorr signature
- BIP341Taproot
- BIP352Silent payments
- BIP37Bloom filter
- BIP39Wallets & custodyBIP39 is the 2013 specification that encodes wallet entropy as words from a fixed 2,048-word list and stretches them into a 512-bit seed.
- BIP65OP_CHECKLOCKTIMEVERIFY
- BIP70Payment protocol (BIP70)
- BitcoinBasicsBitcoin is a digital money system with a fixed supply of 21 million coins, run by a worldwide network of independent computers rather than a bank or a company.
- Bitcoin addressAddresses & keysA bitcoin address is a short encoded string that tells a sender's wallet which locking condition to put on the coins, so only your keys can later spend them.
- Bitcoin ATMBuying & exchangesA bitcoin ATM is a cash kiosk that sells bitcoin on the spot for banknotes, at a double-digit percentage markup that no reputable online exchange would charge.
- Bitcoin banCryptocurrency ban
- Bitcoin CoreNodes & softwareBitcoin Core is the reference implementation of bitcoin, the descendant of Satoshi's original client and the software most of the network's validating nodes actually run.
- Bitcoin denominationsDenomination
- Bitcoin dominanceMarkets & investingBitcoin dominance is bitcoin's share of the combined market capitalization of every crypto asset a data provider chooses to track, quoted as a percentage.
- Bitcoin estate planningBitcoin inheritance planning
- Bitcoin ETFSpot bitcoin ETF
- Bitcoin halvingHalving
- Bitcoin Improvement ProposalProtocol & upgradesA Bitcoin Improvement Proposal is a numbered design document that describes a change to bitcoin or a standard for wallets to follow, with no authority to impose it.
- Bitcoin inheritance planningWallets & custodyBitcoin inheritance planning is the work of making sure someone you choose can find, unlock, and legally claim your coins after you die, without being able to touch them now.
- Bitcoin KnotsNodes & softwareBitcoin Knots is an alternative bitcoin node implementation maintained by Luke Dashjr, consensus-compatible with Bitcoin Core but shipping stricter defaults for which transactions it will relay.
- Bitcoin maximalismCulture & historyBitcoin maximalism is the position that bitcoin is the only cryptocurrency worth owning, and that every other chain competes for attention it will eventually lose.
- Bitcoin miningMining & consensusBitcoin mining is the competition to add the next block of transactions to the blockchain, in which specialized machines guess trillions of hashes for a reward paid in new coins and fees.
- Bitcoin Pizza DayCulture & historyBitcoin Pizza Day is May 22, the anniversary of the 2010 trade in which Laszlo Hanyecz paid 10,000 bitcoin for two delivered pizzas, the first documented purchase of goods.
- Bitcoin ScriptDeveloper referenceBitcoin Script is the small stack-based language that every bitcoin output carries, setting the conditions someone must satisfy before those coins can be spent again.
- Bitcoin transactionTransactions & feesA bitcoin transaction is a signed instruction that destroys some existing coins and creates new ones in their place, which is the only way value ever moves on the network.
- Bitcoin treasury companyMarkets & investingA bitcoin treasury company is a listed business whose main activity is borrowing or issuing shares to buy bitcoin, so its stock is a leveraged wrapper around the coin.
- Bitcoin URIDeveloper referenceA Bitcoin URI packs the details of a payment into one clickable string that begins with bitcoin: and can carry an address, an amount, and a label.
- Bitcoin walletWallet
- Bitcoin whitepaperCulture & historyThe bitcoin whitepaper is the nine page paper published on October 31, 2008 that describes a payment system settling without a bank, by chaining proof of work into a public history.
- BlockMining & consensusA block is one batch of bitcoin transactions plus the 80 byte header that seals it, added to the chain roughly every ten minutes by whichever miner solves it first.
- Block 0Genesis block
- Block chainBlockchain
- Block explorerNodes & softwareA block explorer is a website that lets you search the blockchain by transaction ID, address, or block, showing confirmations, fees, and amounts without running any software yourself.
- Block headerMining & consensusA block header is the 80 byte summary of a block: version, previous header hash, merkle root, timestamp, nBits, and nonce, and it is the part miners actually hash.
- Block heightMining & consensusBlock height is the number of blocks in the chain before a given block, which makes the genesis block height 0 and the block mined after it height 1.
- Block rewardMining & consensusThe block reward is everything a miner is paid for a block: the newly issued subsidy plus every transaction fee inside it, claimed in the block's first transaction.
- Block size limitMaximum block size
- Block size warCulture & historyThe block size war was the 2015 to 2017 fight over whether bitcoin should raise its block size limit by hard fork, and it ended with SegWit and a chain split.
- Block subsidyMining & consensusThe block subsidy is the brand new bitcoin created in each block, fixed by code at 50 coins in 2009 and halving every 210,000 blocks until it reaches zero.
- Block weightMining & consensusBlock weight measures a bitcoin block on a scale where a byte of witness data costs 1 unit and every other byte costs 4, capped at 4,000,000 units.
- BlockchainBasicsThe blockchain is bitcoin's public transaction ledger: an append-only chain of blocks in which each block commits to the one before it by hash, so history cannot be quietly edited.
- Blockchain analysisChain analysis
- Blockchain reorganizationChain reorganization
- Blocks-first syncNodes & softwareBlocks-first sync was bitcoin's original catch-up method, requesting blocks one at a time from a single peer and validating each before asking for the next.
- Blocksize warBlock size war
- Bloom filterNodes & softwareA bloom filter is a compact probabilistic set that BIP37 light wallets sent to a full node so the node would forward only transactions plausibly belonging to them.
- BOLT 11BOLT11 invoice
- BOLT11 invoiceLightning & layer 2A BOLT11 invoice is the long string starting with lnbc that a Lightning wallet produces to request a payment, encoding the amount, a payment hash, an expiry, and a signature.
- Brain walletWallets & custodyBrain wallets turn a memorized phrase straight into a private key by hashing it, a design that researchers emptied at scale and that no maintained wallet still offers.
- BRC-20Protocol & upgradesBRC-20 is an experimental token standard that writes JSON text into ordinal inscriptions and leaves every balance to be computed by off-chain indexers rather than by bitcoin.
- Brokerage buyInstant buy
- BTCBitcoin
- BTMBitcoin ATM
- Bull marketMarkets & investingA bull market in bitcoin is a sustained stretch of rising prices, and it is a label the market only awards in hindsight, usually after the easy part is over.
C
- Capital gains taxRegulation & taxCapital gains tax is what you owe on the profit when you dispose of bitcoin, and in most countries spending it counts as a disposal exactly like selling it.
- CashuLightning & layer 2Cashu is an open protocol for Chaumian ecash on bitcoin, where a mint issues blinded digital notes that spend instantly and privately but remain the mint's IOUs.
- CBDCRegulation & taxA CBDC is money issued directly by a central bank as a digital record, which makes it programmable and traceable by design and the structural opposite of bitcoin.
- CDDCoin days destroyed
- Central bank digital currencyCBDC
- Centralized exchangeCryptocurrency exchange
- Certificate chainDeveloper referenceA certificate chain is the ordered list of certificates that connects the one a server presents back to a root your device already trusts, each link signed by the next.
- CEXCryptocurrency exchange
- Chain analysisPrivacy & securityChain analysis is the practice of reading the public ledger to group addresses into wallets and attach real names to them, using clustering heuristics plus data from exchanges.
- Chain codeAddresses & keysA chain code is the 32 bytes of extra entropy carried alongside each key in an HD wallet, mixing into every child derivation so keys cannot be guessed from their siblings.
- Chain reorganizationMining & consensusA chain reorganization is what happens when your node discovers a branch with more accumulated work, disconnects the blocks it had accepted, and rebuilds the tip along the new branch.
- Change addressAddresses & keysA change address receives the part of an input your wallet did not spend, because bitcoin outputs are consumed whole and any remainder has to go somewhere.
- Change outputChange address
- Channel capacityLightning & layer 2Channel capacity is the total amount of bitcoin locked in a Lightning channel's funding output, which is the ceiling on what the two peers can move between them, not the amount you can spend.
- Chaumian ecashCashu
- Child keyAddresses & keysA child key comes out of a derivation step rather than a random number generator, identified by the index its parent used to produce it.
- Child pays for parentTransactions & feesChild pays for parent rescues a low fee transaction by spending its unconfirmed output in a second transaction whose fee covers both, since miners judge the pair together.
- Child private keyChild key
- Child public keyChild key
- Clipboard malwarePrivacy & securityClipboard malware sits on an infected computer or phone and silently replaces any bitcoin address you copy with one belonging to the attacker, moments before you paste it.
- Clipper malwareClipboard malware
- CLTVOP_CHECKLOCKTIMEVERIFY
- Cluster mempoolProtocol & upgradesCluster mempool is the redesign of Bitcoin Core's waiting room that keeps every group of connected unconfirmed transactions sorted, so the node always knows which ones a miner would actually pick.
- Coin controlPrivacy & securityCoin control is the wallet feature that lets you choose exactly which of your existing coins get spent in a transaction, instead of letting the wallet pick for you.
- Coin days destroyedMarkets & investingCoin days destroyed weights every spend by how long the coins had been sitting still, so one bitcoin untouched for 100 days destroys 100 coin days when it moves.
- CoinbaseTransactions & feesThe coinbase is the free-form field inside a mining reward transaction where the miner writes arbitrary bytes, and it has nothing to do with Coinbase the exchange.
- Coinbase block heightTransactions & feesThe coinbase block height is the block's own height, written as the first bytes of the coinbase field, which BIP34 has required of every block since March 2013.
- Coinbase transactionTransactions & feesThe coinbase transaction is the first transaction in every block, created by the miner to pay out the block subsidy plus the fees, with no inputs to spend.
- CoinJoinPrivacy & securityCoinJoin is a single bitcoin transaction that several people build together, each putting in coins and taking out equal-sized amounts, so no observer can say which output belongs to which input.
- Cold storageWallets & custodyCold storage means the private keys never touch an internet-connected device: they are generated, stored and used to sign on hardware that stays offline.
- Cold walletCold storage
- Collaborative custodyMultisig vault
- Compact block filtersNeutrino
- Compact block relayProtocol & upgradesCompact block relay replaces a new block on the wire with a list of six-byte identifiers, which the receiving node matches against transactions it already holds and reassembles locally.
- Compact size unsigned integerCompactSize
- Compact targetnBits
- CompactSizeDeveloper referenceCompactSize is the variable length integer bitcoin uses to prefix counts and lengths in serialized data, costing one byte for values below 253 and up to nine for the rest.
- Compressed public keyAddresses & keysA compressed public key stores only the x coordinate of a curve point plus a one byte parity flag, fitting a full public key into 33 bytes instead of 65.
- ConfirmationTransactions & feesA confirmation is one block of proof of work stacked on top of the block that contains your transaction, so a payment in the latest block has exactly one.
- Confirmation scoreConfirmation
- ConfirmationsConfirmation
- Confirmed transactionConfirmation
- ConsensusMining & consensusConsensus in bitcoin is the state where independently run nodes, following identical rules, agree on one chain: the valid chain carrying the most accumulated proof of work.
- Consensus rulesMining & consensusConsensus rules are the validity checks every full node applies to a block, and breaking even one of them makes that block invalid no matter how much work it carries.
- ConsolidationUTXO consolidation
- Cost basisRegulation & taxCost basis is what you paid for a coin including fees, the figure subtracted from your sale proceeds to compute a taxable gain, and US rules now require tracking it wallet by wallet.
- CovenantProtocol & upgradesA covenant is a spending rule that limits where bitcoin can go next, not just who may move it, and no opcode in Bitcoin Script can enforce one today.
- CPFPChild pays for parent
- CryptoCryptocurrency
- Crypto exchangeCryptocurrency exchange
- Crypto winterBear market
- CryptocurrencyBasicsCryptocurrency is the broad category of digital assets secured by cryptography and issued on a public network, a category in which bitcoin is one asset among thousands of very different ones.
- Cryptocurrency banRegulation & taxA cryptocurrency ban is a government prohibition on some or all bitcoin activity, ranging from a blanket criminal ban to a narrower order cutting banks off from exchanges.
- Cryptocurrency exchangeBuying & exchangesA cryptocurrency exchange is a company that holds your money and your coins on its own books, matching buyers and sellers internally and settling the result in its database.
- CSVOP_CHECKSEQUENCEVERIFY
- CTVOP_CHECKTEMPLATEVERIFY
- CustodialCustodial wallet
- Custodial walletWallets & custodyA custodial wallet is an account at a company that holds the keys for you, so your balance is a claim on that company rather than coins you control.
- CustodianCustodial wallet
- CypherpunkCulture & historyA cypherpunk is a member of the privacy movement that argued from the early 1990s that strong cryptography, rather than legislation, is what protects individuals from surveillance.
D
- Data carrier transactionNull data transaction
- Data-pushing opcodeOpcode
- DCADollar-cost averaging
- DecentralisationDecentralization
- DecentralizationBasicsDecentralization measures how widely the power to change or block bitcoin is spread across node operators, miners, developers, and users, so that no single group can impose a rule change.
- Decentralized exchangeBuying & exchangesA decentralized exchange swaps one token for another inside a smart contract, with no company holding the funds, no account, and no way to accept a bank transfer.
- DenominationBasicsBitcoin denominations are the named units people price things in, from one whole BTC down through millibitcoin and microbitcoin to the satoshi, all of them the same asset scaled differently.
- Derivation pathAddresses & keysA derivation path is the route through an HD wallet's key tree, written like m/84h/0h/0h/0/0, that tells software exactly which key of billions to rebuild from your seed.
- DescriptorOutput descriptor
- Descriptor walletOutput descriptor
- Desktop walletSoftware wallet
- DEXDecentralized exchange
- DifficultyMining difficulty
- Difficulty adjustmentMining & consensusThe difficulty adjustment is the rule that resets how hard mining is every 2,016 blocks, pulling the average time between blocks back toward ten minutes as hash rate changes.
- Digital signatureTransactions & feesA digital signature is the proof, produced with a private key, that whoever authorized a bitcoin transaction controlled the key its coins were locked to, and that the details have not been altered.
- DNS seedNodes & softwareA DNS seed is a domain name that answers with the IP addresses of reachable Bitcoin nodes, giving a freshly installed node somewhere to make its first connection.
- Dollar-cost averagingBuying & exchangesDollar-cost averaging is buying a fixed amount of bitcoin on a fixed schedule, so the price you pay averages out instead of depending on one lucky day.
- Double spendPrivacy & securityA double spend is an attempt to make the same bitcoin pay two different people, by getting a second transaction that spends the same coins confirmed instead of the first.
- Double spendingDouble spend
- DrivechainLightning & layer 2Drivechain is an unactivated proposal, BIP300 and BIP301, that would let bitcoin miners rather than a federation guard sidechain deposits, with withdrawals taking months of miner votes.
- DustPrivacy & securityDust is a coin so small that spending it would cost more in transaction fees than the coin is worth, which makes it economically stranded in your wallet.
- Dust attackDusting attack
- Dust limitPrivacy & securityThe dust limit is the smallest amount a bitcoin output can hold before nodes refuse to relay the transaction that creates it, currently 546 satoshis for a legacy address.
- Dust thresholdDust limit
- Dusting attackPrivacy & securityA dusting attack sprays tiny payments across thousands of addresses so the sender can watch which ones later get spent together, linking separate addresses to a single owner.
E
- EcashCashu
- ECDSA signatureDigital signature
- El Salvador Bitcoin LawCulture & historyThe El Salvador Bitcoin Law made bitcoin legal tender alongside the US dollar from September 2021, and was amended in January 2025 to make acceptance voluntary.
- Electrum Personal ServerElectrum server
- Electrum serverNodes & softwareAn Electrum server indexes the blockchain by script and answers address queries for lightweight wallets, so those wallets get instant balances without downloading the chain themselves.
- Ephemeral anchorProtocol & upgradesAn ephemeral anchor is a zero-value output added to a transaction purely so that somebody can attach a fee-paying child and drag the parent into a block.
- ErlayProtocol & upgradesErlay is a proposed way for nodes to compare notes on which transactions they have seen using tiny sketches, instead of shouting every transaction hash at every peer.
- Escrow contractTransactions & feesAn escrow contract locks bitcoin in an output that neither trading party can spend alone, releasing it only when both agree or a named third party breaks the tie.
- Exit scamPrivacy & securityAn exit scam is a platform that operates normally, builds up customer deposits, and then vanishes with them, usually behind a wall of withdrawal delays and technical excuses.
- Extended keyAddresses & keysAn extended key pairs an ordinary bitcoin key with a 32-byte chain code, and that pair is what lets software derive an entire branch of keys below it.
F
- FATFRegulation & taxFATF is the intergovernmental body in Paris that writes the anti-money-laundering standards almost every country copies into law, including the rules your exchange applies to you.
- FATF Travel RuleTravel Rule
- Fear of missing outFOMO
- Fear, uncertainty and doubtFUD
- Federated mintFedimint
- FedimintLightning & layer 2Fedimint is a protocol for community custody: a group of guardians holds bitcoin in a threshold multisig and issues blinded ecash notes that the guardians themselves cannot trace.
- Fee rateTransactions & feesA fee rate is the price you pay per unit of transaction size, quoted in satoshis per virtual byte, and it is the only number miners sort by when filling a block.
- FiatBasicsFiat money is currency that a government declares valid by law rather than backing with gold or silver, which is why every dollar, euro, or naira price you see is a fiat price.
- Fiat currencyFiat
- Fiat moneyFiat
- Fiat off-rampOff-ramp
- Fiat on-rampOn-ramp
- Financial Action Task ForceFATF
- FOMOCulture & historyFOMO, fear of missing out, is the buying impulse that arrives after a price has already run, and it is the single most expensive emotion in bitcoin.
- Force closeLightning & layer 2A force close ends a Lightning channel without your counterparty's help: you broadcast the latest commitment transaction, pay on-chain fees, and wait out a delay before your own balance is spendable.
- ForkProtocol & upgradesA fork is any point where bitcoin's history or its rulebook splits in two, which is why the word covers three different events that resolve on completely different timescales.
- Form 1099-DARegulation & taxForm 1099-DA is the US tax form on which a custodial broker reports your digital asset sales to the IRS and to you, starting with the 2025 tax year.
- Free transactionHigh-priority transaction
- FUDCulture & historyFUD stands for fear, uncertainty and doubt, a label bitcoin holders attach to negative claims, sometimes correctly and sometimes to wave away a real warning.
- Full nodeNode
- Full-RBFReplace-by-fee
G
H
- HalveningHalving
- HalvingMining & consensusThe halving is the moment, every 210,000 blocks, when the new bitcoin paid to miners is cut in half, tightening bitcoin's issuance on a schedule nobody can change.
- Hard cap21 million supply cap
- Hard forkProtocol & upgradesA hard fork loosens or changes bitcoin's rules so that blocks the old software rejects become valid, which means every node must upgrade or be left behind on a different chain.
- Hardened derivationAddresses & keysHardened derivation feeds the parent private key into every child calculation, which is what stops a leaked extended public key from unraveling the branch beneath it.
- Hardened extended keyHardened derivation
- Hardware walletWallets & custodyA hardware wallet is a small dedicated device that generates and holds your private keys, signs transactions internally, and shows you on its own screen what you are agreeing to.
- Hash rateMining & consensusHash rate is the number of hash attempts the mining network makes each second, the standard measure of how much computing work is defending bitcoin at any moment.
- Hash time-locked contractHTLC
- Hashing powerHash rate
- HashpriceMining & consensusHashprice is the daily revenue a miner earns per unit of computing power, usually quoted in dollars per petahash per day, and it is the number that decides whether a machine is worth running.
- HashrateHash rate
- HD protocolHD wallet
- HD walletAddresses & keysAn HD wallet grows every key it will ever need from a single random seed, arranged as the tree of parents and children that BIP-32 specified in 2012.
- HD wallet seedWallets & custodyThe HD wallet seed is the raw binary number, 128 to 512 bits of it, that BIP-32 feeds into one hash to produce a wallet's master key and chain code.
- HeaderBlock header
- Header chainNodes & softwareThe header chain is the sequence of 80 byte block headers a node has verified, which can run thousands of blocks ahead of the block data it has actually downloaded.
- Headers-first syncNodes & softwareHeaders-first sync is the startup strategy where a node downloads and verifies the whole 80 byte header chain before requesting any block bodies, then fetches those bodies in parallel.
- HeightBlock height
- Hidden walletPassphrase
- Hierarchical deterministic walletHD wallet
- High-priority transactionTransactions & feesA high-priority transaction was one that old versions of Bitcoin Core would mine for free because it spent old, large coins, a mechanism deleted from the software in 2017.
- HODLCulture & historyHODL is bitcoin slang for holding through volatility instead of trading, born from a misspelled forum post and now shorthand for a long horizon strategy.
- HodlingHODL
- Hot walletWallets & custodyA hot wallet keeps its private keys on a device that is connected to the internet, so it can sign a payment in seconds and can be robbed by software.
- HTLCLightning & layer 2An HTLC is a payment that pays out only against a secret, and refunds the sender if that secret never arrives before a block height both sides agreed on.
I
- IBDInitial block download
- Inbound liquidityLightning & layer 2Inbound liquidity is the amount someone can send you over Lightning right now, which equals the balance your channel partners hold on their side of your open channels.
- Initial block downloadNodes & softwareInitial block download is the catch-up phase a new bitcoin node goes through, fetching and verifying every block from the genesis block to the current tip.
- InputTransaction input
- InscriptionProtocol & upgradesAn inscription is a file stored inside a Taproot witness and attached to one satoshi, which is how images, text, and collectibles ended up living on bitcoin itself.
- Instant buyBuying & exchangesAn instant buy is the one-click purchase widget on an exchange, where the venue quotes you a single price and sells to you directly instead of matching you in the order book.
- Intermediate certificateDeveloper referenceAn intermediate certificate sits between a root and a leaf, signed by the root and signing the leaf, so the root's private key can stay offline and unused.
- Internal byte orderDeveloper referenceInternal byte order is the layout bitcoin uses inside serialized structures: integers written least significant byte first, and hash digests written in the order SHA-256 produced them.
- Inv messageInventory
- InventoryNodes & softwareAn inventory is the list of object identifiers a node advertises to its peers, saying what transactions and blocks it holds without sending any of them yet.
J
K
- Key aggregationMuSig2
- Key indexAddresses & keysA key index is the number chosen at each step of an HD derivation, from 0 up to 4,294,967,295, that decides which child of a parent key you land on.
- Key pairAddresses & keysA key pair is one private key together with the single public key it generates, the unit of ownership that every bitcoin signature and every multisig quorum is counted in.
- Know Your CustomerRegulation & taxKnow Your Customer is the set of checks a regulated exchange runs before it lets you trade: identity documents, a selfie, an address, and a permanent record of all of it.
- KYCKnow Your Customer
- KYC-free exchangeNo-KYC exchange
L
- LabelDeveloper referenceThe label in a Bitcoin URI names the person or business being paid, and in a wallet it is the private note you attach to an address or a transaction.
- Leaf certificateDeveloper referenceThe leaf certificate is the end-entity certificate presented by the server you actually connected to, and it proves control of a domain name, nothing about the people behind it.
- Legacy addressAddresses & keysA legacy address is a Base58Check string beginning with 1, the original bitcoin address format, and coins sitting in one cost the most to move.
- Legal tenderRegulation & taxLegal tender is a legal status that forces creditors to accept a currency for debts, and bitcoin has held it in only two countries, both of which have since withdrawn it.
- LightningLightning Network
- Lightning addressLightning & layer 2A Lightning address looks like an email address, user at domain, and resolves to a web endpoint on that domain which hands your wallet a fresh Lightning invoice on request.
- Lightning channelPayment channel
- Lightning invoiceBOLT11 invoice
- Lightning NetworkLightning & layer 2The Lightning Network is a payment layer built on top of bitcoin where two parties lock coins in a shared on-chain address and then pay each other instantly off-chain.
- Lightweight clientNodes & softwareA lightweight client is a wallet that holds no copy of the blockchain and asks other people's servers what happened to your addresses.
- Limit orderBuying & exchangesA limit order sets the worst price you will accept and waits, so it controls what you pay but offers no promise that the trade ever happens.
- LiquidLiquid Network
- Liquid NetworkLightning & layer 2Liquid Network is a bitcoin sidechain run by a federation of exchanges and financial firms, offering one minute blocks, confidential amounts, and issued assets in exchange for federated custody.
- LNLightning Network
- LNURLLightning & layer 2LNURL is a family of small web protocols that let a Lightning wallet fetch a fresh invoice, a withdrawal, or a login challenge from a server by following one encoded link.
- Locking scriptPubkey script
- LocktimeTransactions & feesLocktime is the last four bytes of a transaction, setting the earliest block height or clock time at which the network will accept it into a block.
M
- MainnetNodes & softwareMainnet is the live Bitcoin network, the one chain where coins have real value, running without interruption since the genesis block was mined on January 3, 2009.
- Majority attack51% attack
- Maker and taker feesBuying & exchangesMaker and taker fees are the two prices an exchange charges for a trade: less if your order waits in the book, more if it takes an existing order out.
- Maker feeMaker and taker fees
- Market capMarket capitalization
- Market capitalizationMarkets & investingMarket capitalization is bitcoin's circulating supply multiplied by its latest traded price, a headline number that measures the market's current valuation rather than money invested.
- Market orderBuying & exchangesA market order buys or sells immediately at whatever prices the order book is offering, which guarantees that the trade happens but never guarantees what it costs.
- Market value to realized valueMVRV ratio
- Markets in Crypto-Assets RegulationMiCA
- MASFMiner-activated soft fork
- MASTProtocol & upgradesMAST hides every spending condition you do not use behind a Merkle tree, so revealing one branch when you spend keeps the rest private and off the blockchain.
- Master chain codeAddresses & keysThe master chain code is the right half of the 64 byte hash of your seed, the companion to the master private key that sits at depth zero of an HD wallet tree.
- Master private keyMaster chain code
- MaximalismBitcoin maximalism
- Maximum block sizeMining & consensusMaximum block size is the ceiling on how much data one bitcoin block may carry, and since SegWit that ceiling is a four million weight unit budget rather than a byte count.
- Memory poolMempool
- MempoolTransactions & feesA mempool is the set of valid transactions a node has heard about but not yet seen in a block, held in memory while they wait for a miner to pick them up.
- Mempool policyTransactions & feesMempool policy is the extra set of rules a node applies before it will accept and relay a transaction, stricter than consensus and adjustable by whoever runs the node.
- MergePrivacy & securityA merge is a transaction that spends coins from two or more of your addresses at once, publicly announcing that those addresses share a single owner.
- Merge avoidancePrivacy & securityMerge avoidance is the practice of never spending two of your coins in the same transaction, keeping the different parts of your wallet from being publicly tied together.
- Merkelized Alternative Script TreeMAST
- Merkle blockMining & consensusA merkle block is the reply a light wallet gets when it asks for filtered block contents: the 80 byte header plus just enough hashes to prove which transactions matched.
- Merkle rootMining & consensusThe merkle root is the single 32 byte hash in a block header that commits to every transaction in that block, in the exact order the miner arranged them.
- Merkle treeMining & consensusA merkle tree is the hash pyramid that compresses every transaction in a block down to a single 32 byte value, so any one payment can be proved without the rest.
- MessageP2P message
- Message headerNodes & softwareBitcoin's message header is a fixed 24 bytes of envelope wrapped around every peer-to-peer message: a network start string, a command name, a payload length, and a checksum.
- Metal seed backupWallets & custodyA metal seed backup records your recovery words by stamping, punching, or engraving them into steel, so the words survive the house fire and the flood that paper does not.
- MiCARegulation & taxMiCA is the European Union's crypto licensing law, and it regulates the companies that sell you bitcoin rather than bitcoin itself, which has no issuer to regulate.
- Micropayment channelPayment channel
- MinerBitcoin mining
- Miner feeTransaction fee
- Miner-activated soft forkProtocol & upgradesA miner-activated soft fork switches on when a supermajority of mined blocks signals for it, using the block version field as a vote counted automatically by every node.
- Miners feeTransaction fee
- Minimum relay feeTransactions & feesThe minimum relay fee is the floor a transaction must pay before a node will keep it at all, lowered in Bitcoin Core 30.0 from 1 satoshi per virtual byte to 0.1.
- MiningBitcoin mining
- Mining difficultyMining & consensusMining difficulty is the dial the network turns every 2,016 blocks to keep blocks arriving about ten minutes apart, no matter how much or how little hash rate shows up.
- Mining poolMining & consensusA mining pool combines the hash rate of thousands of separate miners so they share block rewards in small, regular payments instead of each waiting years for a block of their own.
- Mining rigASIC
- MiniscriptProtocol & upgradesMiniscript is a structured way of writing the useful subset of Bitcoin Script so that software can analyze a spending policy, work out its costs, and sign for it automatically.
- Mnemonic codeBIP39
- Mnemonic seedSeed phrase
- Mobile walletSoftware wallet
- MSG_BLOCKDeveloper referenceMSG_BLOCK is inventory type 2, the code a node puts in a getdata message to ask a peer for one complete block by its hash.
- MSG_CMPCT_BLOCKDeveloper referenceMSG_CMPCT_BLOCK, inventory type 4, is a request-only code: it never appears in an announcement and is legal only inside a getdata message sent to a peer that agreed to it first.
- MSG_FILTERED_WITNESS_BLOCKDeveloper referenceThe filtered witness block type sits in BIP144's reserved list and in Bitcoin Core's source enum, with no implementation behind it in either place.
- MSG_TXDeveloper referenceMSG_TX marks an inventory entry as a transaction, type code 1, and it is how your unconfirmed payment gets announced to peers before any of them have seen its contents.
- MSG_WITNESS_BLOCKDeveloper referenceThe witness block inventory type is how a segwit-aware node asks for a block in the extended serialization, with every signature attached instead of stripped away.
- MSG_WITNESS_TXDeveloper referenceA witness transaction request, sent as getdata, tells a peer to return the named transaction with its signature data still attached rather than stripped out.
- Mt. GoxCulture & historyMt. Gox was the Tokyo exchange that handled most bitcoin trading until February 2014, when it froze withdrawals and filed for bankruptcy with 850,000 coins missing.
- MtGoxMt. Gox
- MultisigWallets & custodyMultisig locks bitcoin behind several keys at once and requires a set number of signatures to spend, so losing or leaking any one key does not lose the coins.
- Multisig vaultWallets & custodyA multisig vault is a long-term storage arrangement secured by several keys, typically with a service provider holding one of them, so no single party can move the coins.
- MultisignatureMultisig
- MuSig2Protocol & upgradesMuSig2 lets several signers combine their public keys into one and produce a single 64-byte Schnorr signature, so a group spend looks identical to a solo spend on chain.
- MVRV ratioMarkets & investingThe MVRV ratio divides bitcoin's market capitalization by its realized capitalization, giving a single number for how far the price sits above what holders collectively paid.
N
- Native SegWit addressP2WPKH
- nBitsMining & consensusnBits is the four byte field in every block header that packs the mining target into a compact, floating point style encoding of one exponent and a three byte coefficient.
- Nested SegWitAddresses & keysNested SegWit wraps a native SegWit key hash inside a P2SH address, buying compatibility with software that could not read bc1 strings, at about 23 extra vbytes per input.
- Network difficultyMining difficulty
- Network feeTransaction fee
- Network magicStart string
- Network value to transactionsNVT ratio
- NeutrinoNodes & softwareNeutrino is the light client design where your wallet downloads a tiny filter for each block, checks it locally, and only fetches the full blocks that might concern you.
- nLockTimeLocktime
- No-KYC exchangeBuying & exchangesA no-KYC exchange sells bitcoin without collecting your identity documents, which is legal in some places, prosecutable in others, and always a trade of price and recourse for privacy.
- NodeNodes & softwareA node is a computer running bitcoin software that stores the chain, checks every rule for itself, and relays valid blocks and transactions to its peers.
- Node runnerRunning a full node
- Non-custodial walletWallets & custodyNon-custodial wallets hold your keys on your own device, which means no company can freeze your bitcoin, reverse a payment, or restore access when you lose the backup.
- Non-data-pushing opcodeOpcode
- NonceMining & consensusA nonce is the four byte counter in a block header that miners increment while searching for a hash below the target, giving only 4,294,967,296 tries per header.
- Noncustodial walletNon-custodial wallet
- Not your keys, not your coinsCulture & historyNot your keys, not your coins is the warning that bitcoin left on an exchange is a claim against a company, not bitcoin you actually control.
- nSequenceSequence number
- Null data transactionTransactions & feesA null data transaction carries an output that stores a short message instead of money, marked provably unspendable so nodes can discard it from the set of spendable coins.
- NVT ratioMarkets & investingThe NVT ratio divides bitcoin's network value by the value settled on chain each day, borrowing the logic of a price-to-earnings ratio for a network with no earnings.
O
- Off-rampBuying & exchangesAn off-ramp converts bitcoin back into spendable national currency in your bank account, and it is the leg of the journey that fails most often for ordinary people.
- On-rampBuying & exchangesAn on-ramp is any service that turns your national currency into bitcoin, and the hard part is the payment rail it accepts, not the coins it delivers.
- OP_CATProtocol & upgradesOP_CAT joins the top two items on the script stack into one, an operation Satoshi disabled in 2010 and that BIP-347 proposes to restore inside tapscript.
- OP_CHECKLOCKTIMEVERIFYProtocol & upgradesOP_CHECKLOCKTIMEVERIFY is the script opcode that stops a coin being spent before a stated block height or calendar date, no matter who holds the key.
- OP_CHECKMULTISIGDeveloper referenceOP_CHECKMULTISIG verifies a group of signatures against a list of public keys in one step, and Taproot spends cannot use it at all because it blocks batch verification.
- OP_CHECKSEQUENCEVERIFYProtocol & upgradesOP_CHECKSEQUENCEVERIFY locks a coin for a stretch of time measured from its own confirmation, failing any spend whose input has not waited long enough.
- OP_CHECKSIGDeveloper referenceOP_CHECKSIG takes a public key and a signature off the stack and verifies that the signature commits to this transaction, which is the check that actually proves you own the coins.
- OP_CHECKSIGADDProtocol & upgradesOP_CHECKSIGADD counts signatures one key at a time inside tapscript, replacing the old multisig opcode with a check that batch verification and future key types can both handle.
- OP_CHECKTEMPLATEVERIFYProtocol & upgradesOP_CHECKTEMPLATEVERIFY is a proposed opcode that would let an output commit in advance to the exact transaction allowed to spend it, down to its outputs and amounts.
- OP_DUPDeveloper referenceOP_DUP copies the top item on the stack so it can be used twice, which is why the standard pay-to-public-key-hash script can both hash your public key and verify against it.
- OP_EQUALDeveloper referenceOP_EQUAL compares the top two stack items byte for byte and pushes a true or false result, and it is the last opcode in every pay-to-script-hash output.
- OP_EQUALVERIFYDeveloper referenceOP_EQUALVERIFY compares the top two stack items and kills the script instantly if they differ, which is how a legacy spend proves it presented the right public key.
- OP_HASH160Developer referenceOP_HASH160 runs SHA-256 over the top stack item and then RIPEMD-160 over that result, leaving a 20 byte digest, the same fingerprint carried inside every address beginning with 1 or 3.
- OP_RETURNDeveloper referenceOP_RETURN is the opcode that makes a transaction output provably unspendable, which lets a small amount of arbitrary data be written to the blockchain without bloating the set of live coins.
- OP_RETURN transactionNull data transaction
- OP_VERIFYDeveloper referenceOP_VERIFY pops the top stack item and aborts the entire script unless that item is true, turning any test in Bitcoin Script into a hard requirement.
- OpcodeDeveloper referenceAn opcode is a single byte of Bitcoin Script that tells a validating node what to do next, either pushing data onto the stack or performing one operation on what is already there.
- Opt-in replace by feeReplace-by-fee
- Orange pillCulture & historyOrange pill is the slang for the moment someone stops dismissing bitcoin and starts studying it, borrowed from The Matrix and colored after the bitcoin logo.
- Order bookBuying & exchangesAn order book is the live list of every buy and sell offer waiting at each price on an exchange, and the price you see quoted is simply its top.
- Ordinal inscriptionInscription
- Ordinal theoryOrdinals
- OrdinalsProtocol & upgradesOrdinals is a numbering scheme that assigns every satoshi a serial number in mining order and tracks it through transactions, giving individual units of bitcoin an identity.
- Orphan blockMining & consensusAn orphan block is a block whose parent your node has not seen yet, so it cannot be validated or connected, which is not what most people mean when they say the word.
- OTC deskBuying & exchangesAn OTC desk quotes a single price for a large bitcoin trade and settles it privately, off the public order book, so the purchase never moves the visible market.
- OutpointTransactions & feesAn outpoint is the 36-byte pointer that identifies exactly one transaction output, combining the 32-byte id of the transaction that created it with the 4-byte index of its position.
- OutputTransaction output
- Output descriptorAddresses & keysAn output descriptor is a single line of text that states which script type, which keys and which derivation branch a wallet should use, with a checksum on the end.
- Output indexTransactions & feesAn output index is the position of one output inside a transaction, counted from zero, and it is the number after the colon when you see a coin written as txid:1.
- Over-the-counter deskOTC desk
P
- P2EPPayjoin
- P2PPeer-to-peer
- P2P exchangePeer-to-peer exchange
- P2P marketplacePeer-to-peer exchange
- P2P messageNodes & softwareP2P messages are the fixed vocabulary bitcoin nodes use to talk to each other: short commands like version, inv, getdata, tx, and block, sent over a plain TCP connection.
- P2PKH addressAddresses & keysP2PKH is the output type that locks coins to a 20-byte hash of a public key, so the key itself stays hidden until the moment you spend.
- P2PKH outputP2PKH address
- P2SH addressAddresses & keysA P2SH address begins with 3 and commits to the hash of a redeem script, so the spending conditions stay secret until someone reveals the script.
- P2SH multisigAddresses & keysP2SH multisig hides an m-of-n redeem script behind a 3 address, and the 520-byte script cap limits it to fifteen public keys.
- P2SH outputP2SH address
- P2SH-P2WPKHNested SegWit
- P2TRAddresses & keysP2TR pays to a single 32-byte tweaked public key, so a key spend looks identical on-chain whether one person signed or a complicated contract settled cooperatively.
- P2WPKHAddresses & keysP2WPKH moves the signature and public key out of the input and into the witness, where each byte counts one weight unit instead of four.
- P2WSHAddresses & keysP2WSH locks coins to a 32-byte SHA-256 commitment to a witness script, giving contracts far more room than P2SH and a discount on the script when it is revealed.
- Package relayTransactions & feesPackage relay lets a node accept a group of related unconfirmed transactions together, so a child paying a high fee can carry a parent the network would otherwise refuse.
- Paper gainUnrealized gain
- Paper walletWallets & custodyA paper wallet is a printed private key and address from the pre-hardware era, and spending from one safely is harder than the format ever admitted.
- Parent keyAddresses & keysThe parent key sits one level directly above another key in an HD wallet's tree, and every extended key carries four bytes that fingerprint its own parent.
- Parent private keyParent key
- Parent public keyParent key
- Partial merkle branchMerkle block
- Partially Signed Bitcoin TransactionPSBT
- PassphraseWallets & custodyA passphrase is an extra secret added to your recovery words that produces a completely different wallet, with no way to check whether the one you typed was right.
- Pay-to-endpointPayjoin
- Pay-to-Public-Key-HashP2PKH address
- Pay-to-Script-HashP2SH address
- Pay-to-TaprootP2TR
- Pay-to-Witness-Public-Key-HashP2WPKH
- Pay-to-Witness-Script-HashP2WSH
- PayjoinPrivacy & securityPayjoin is a payment where the person receiving the coins quietly adds one of their own inputs to your transaction, so the amount on chain no longer matches the amount you actually paid.
- Payment channelLightning & layer 2A payment channel is a two-party bitcoin contract funded by one on-chain transaction, inside which the two sides can rewrite the split of that money thousands of times without touching the chain.
- Payment protocolPayment protocol (BIP70)
- Payment protocol (BIP70)Developer referenceThe payment protocol (BIP70) was bitcoin's attempt to replace bare addresses with signed, certificate-backed payment requests, and Bitcoin Core removed the last of its support in version 0.20.0.
- PaymentDetailsDeveloper referencePaymentDetails is the inner BIP70 message that actually described a payment: which outputs to pay, how much, when the request expires, and where to send the signed transaction.
- PaymentRequestDeveloper referencePaymentRequest is the outer BIP70 envelope: it wraps a serialized PaymentDetails blob together with a certificate chain and a signature, so the payer could check who was asking.
- PeerNode
- Peer-to-peerBasicsPeer-to-peer describes a network where every participant connects directly to other participants as an equal, with no central server in the middle deciding whose payment goes through.
- Peer-to-peer exchangeBuying & exchangesA peer-to-peer exchange is a marketplace where individuals trade bitcoin with each other directly, with the platform holding the coins in escrow while the buyer sends payment by whatever local method both agreed.
- Pending transactionStuck transaction
- PermissionlessBasicsPermissionless means anyone can use bitcoin's base layer without applying to anybody: no account approval, no minimum balance, and no authority with a switch that turns your access off.
- PhishingPrivacy & securityPhishing is a fake message or website built to look like your exchange, wallet, or hardware wallet vendor, so that you hand over a password, a code, or your seed phrase.
- Pig butchering scamPrivacy & securityA pig butchering scam is a long confidence fraud where someone you meet online spends weeks building trust, then steers you into a fake crypto investment platform that pays out nothing.
- PKIDeveloper referencePKI, or public key infrastructure, is the system of certificate authorities, certificates and trust stores that lets software decide whether a public key really belongs to the name attached to it.
- Point functionDeveloper referenceThe point function turns a private key into a public key by multiplying the secp256k1 generator point by that number, and it is the one-way step every bitcoin address is built on.
- Point time-locked contractPTLC
- PoRProof of reserves
- PoWProof of work
- PP amountDeveloper referencePP amount was the satoshi-denominated field inside a BIP70 output, set to zero when the merchant wanted the payer to choose how much to send.
- PP expiresDeveloper referencePP expires was the optional Unix timestamp in a BIP70 PaymentDetails message that told a wallet to stop honoring the request once that moment had passed.
- PP memoDeveloper referencePP memo was the free-text UTF-8 note that BIP70 let a merchant, a payer, or an acknowledging server attach to a payment for a human to read.
- PP merchant dataDeveloper referencePP merchant data was an opaque byte string a BIP70 merchant put in a payment request and got back untouched, so the incoming coins could be matched to an order.
- PP pki dataDeveloper referencePP pki data was the field in a BIP70 payment request that carried the merchant's certificates, DER encoded, leaf first, with any intermediates behind it and the root left out.
- PP pki typeDeveloper referencePP pki type was the one-word string in a BIP70 payment request that said how the merchant had signed it: none, x509 with SHA-256, or x509 with SHA-1.
- PP scriptDeveloper referencePP script was the required field in a BIP70 output holding the raw locking script the payer had to reproduce, the same bytes that end up in a transaction output.
- Previous block header hashMining & consensusThe previous block header hash is the 32 byte field in every block header that names its parent, and it is the single link that turns a pile of blocks into a chain.
- Private extended keyExtended key
- Private keyAddresses & keysA private key is the 256-bit secret number that authorizes spending from a bitcoin output; anyone who learns it can move the coins, and nobody can reissue it.
- Proof of KeysCulture & historyProof of Keys is the annual January 3 exercise in which holders withdraw their coins from every custodian, testing both the platform's solvency and their own backups.
- Proof of reservesPrivacy & securityProof of reserves is an exchange publishing cryptographic evidence that it actually holds the coins it owes customers, usually a Merkle tree of balances plus signatures from its wallets.
- Proof of workMining & consensusProof of work is the rule that a block only counts once its header hashes below a target, so publishing a valid block costs real electricity that anyone can verify in milliseconds.
- Pruned nodeNodes & softwareA pruned node validates the entire blockchain and then deletes the old block files it no longer needs, keeping full verification while giving up the archive.
- PSBTTransactions & feesA PSBT is a transaction file that is not finished yet: it carries the inputs, outputs, and everything a signer needs to verify them, and it travels between devices instead of across the network.
- PseudonymityPrivacy & securityPseudonymity means your bitcoin addresses stand in for your name rather than hiding it: nothing on the ledger says who you are, and nothing forgets what you did.
- PseudonymousPseudonymity
- PTLCLightning & layer 2A PTLC locks a payment to an elliptic curve point rather than a hash, so each hop on a Lightning route sees a different lock and cannot recognize the same payment twice.
- Pubkey scriptDeveloper referenceThe pubkey script is the short piece of Bitcoin Script attached to every transaction output, stating the conditions that must be met before the coins in that output can move again.
- Public extended keyExtended key
- Public keyAddresses & keysA public key is the point on the secp256k1 curve derived from your private key, publishable without risk, and the value a signature is checked against when you spend.
- Public key infrastructurePKI
R
- R parameterDeveloper referenceThe R parameter is the BIP72 addition to a bitcoin URI that replaces the payment address with a URL your wallet is expected to fetch a signed request from.
- Raw transactionSerialized transaction
- RBFReplace-by-fee
- Realized capRealized capitalization
- Realized capitalizationMarkets & investingRealized capitalization values every coin at the price it last moved on chain and adds those figures up, producing an estimate of what the whole market paid.
- ReceiptDeveloper referenceA receipt in bitcoin is whatever evidence you keep that a payment happened: in BIP70 it was a signed acknowledgment from the merchant, and in practice it is the transaction ID.
- Receive capacityInbound liquidity
- Recovery phraseSeed phrase
- Recurring buyBuying & exchangesA recurring buy is the exchange feature that executes a purchase for you on a schedule, pulling money from your bank on the day you picked without you logging in.
- Redeem scriptDeveloper referenceA redeem script is the full spending contract hidden behind a pay-to-script-hash output, supplied by the spender at the end of the signature script and hashed to check it matches.
- redeemScriptRedeem script
- Regression test modeRegtest
- RegtestNodes & softwareRegtest is a private Bitcoin network that runs on your own machine, where you mine blocks on command instead of waiting for anyone else to produce them.
- RehypothecationPrivacy & securityRehypothecation is a custodian lending out, pledging, or trading the bitcoin you deposited, so the coins backing your account balance are working somewhere else entirely.
- Relay feeMinimum relay fee
- Relay policyMempool policy
- Remote procedure callRPC
- ReorgChain reorganization
- Replace by feeReplace-by-fee
- Replace-by-feeTransactions & feesReplace-by-fee lets an unconfirmed transaction be swapped for a higher paying version of itself, and modern Bitcoin Core relays that replacement whether or not the original signaled for it.
- RetargetDifficulty adjustment
- Romance investment scamPig butchering scam
- Root certificateDeveloper referenceA root certificate is the self-signed trust anchor at the top of a certificate chain, and it is trusted only because your operating system or browser vendor put it there.
- Root seedHD wallet seed
- Routing nodeLightning & layer 2A routing node is a Lightning node that keeps channels open in both directions and forwards other people's payments through them, collecting a small fee on every hop it relays.
- RPCNodes & softwareRPC is the command interface a bitcoin node exposes to other programs, letting a wallet, an exchange back end, or your own terminal ask it questions and issue instructions.
- RPC byte orderDeveloper referenceRPC byte order is the reversed way bitcoin software displays 32 byte hashes, and it is the form of every transaction ID you copy from a wallet or a block explorer.
- Rug pullPrivacy & securityA rug pull is a token launch whose creators drain the trading liquidity or dump their own reserved supply, leaving buyers holding something with no market to sell into.
- RunesProtocol & upgradesRunes is a token protocol that records issuance and transfers in a single OP_RETURN output, so balances ride on unspent outputs instead of on inscribed text files.
- Runes protocolRunes
- Running a full nodeNodes & softwareRunning a full node means keeping bitcoin software on a machine you control that downloads the chain, checks every rule itself, and answers your wallet's questions without asking anyone else.
S
- S2FStock-to-flow
- Sanctions screeningRegulation & taxSanctions screening is the check an exchange runs on your name and your bitcoin addresses against government blocked-party lists before it lets a transfer through.
- SatSatoshi
- sat/vBFee rate
- SatoshiBasicsA satoshi is the smallest amount of bitcoin the protocol can record, one hundred millionth of a bitcoin, and the unit every fee estimate and Lightning payment is actually counted in.
- Satoshi NakamotoCulture & historySatoshi Nakamoto is the pseudonym of the person or group who published the bitcoin whitepaper, released the first software, mined the earliest blocks, and then walked away.
- Satoshis per virtual byteFee rate
- SatsSatoshi
- Sats per vbyteFee rate
- Schnorr signatureProtocol & upgradesA Schnorr signature is the 64-byte signature scheme bitcoin adopted with Taproot, and its defining property is linearity: several keys and signatures add together into one.
- ScriptBitcoin Script
- scriptPubKeyPubkey script
- scriptSigSignature script
- Secret recovery phraseSeed phrase
- Seed phraseWallets & custodyA seed phrase is the ordered list of 12 or 24 ordinary words that can regenerate every key in a wallet, which makes it the one thing worth guarding physically.
- Segregated WitnessSegWit
- SegWitProtocol & upgradesSegWit moved signature data out of the part of a transaction that the txid commits to, fixing transaction malleability and raising block capacity without changing the one megabyte base limit.
- Self-custodyNon-custodial wallet
- Self-custody rightsRegulation & taxSelf-custody rights are the legal protections, mostly proposed rather than enacted, that would guarantee you can hold your own bitcoin keys and transact without a licensed intermediary.
- Self-hosted walletUnhosted wallet
- Selfish miningMining & consensusSelfish mining is a strategy where a miner hides a solved block and releases it only to invalidate a rival's, earning more than its share of hash power should pay.
- Sequence numberTransactions & feesThe sequence number is a four byte field on every transaction input that signals fee replacement, switches locktime on, and can encode a relative timelock.
- Serialized blockMining & consensusA serialized block is the exact byte string a block becomes on the wire or on disk: the 80 byte header, a transaction count, then every transaction in order.
- Serialized transactionTransactions & feesA serialized transaction is the exact byte string a wallet hands to the network, the hexadecimal form that every node parses, hashes, and relays without altering a single byte.
- SHA-256Mining & consensusSHA-256 takes an input of any length and returns a 32 byte fingerprint that is identical every time, unpredictable in advance, and impossible to work backwards from.
- SHA256SHA-256
- Shamir backupWallets & custodyShamir backup splits one wallet secret into several word lists and requires any chosen number of them to rebuild it, so no single sheet of paper is enough.
- Shamir secret sharingShamir backup
- ShitcoinCulture & historyShitcoin is blunt slang for a coin the speaker believes has no reason to exist, usually one built to be sold to latecomers rather than used.
- SidechainLightning & layer 2A sidechain is a separate blockchain whose coins are backed by bitcoin locked on the main chain, so value moves between the two through a peg instead of a trade.
- SighashSignature hash
- SIGHASH_ALLTransactions & feesSIGHASH_ALL is the flag that makes a signature commit to every input and every output of a transaction, so nothing about the payment can be changed after signing.
- SIGHASH_ANYONECANPAYTransactions & feesSIGHASH_ANYONECANPAY is a modifier that strips every other input out of the digest, so a signature covers only the one coin it spends and others can join the transaction freely.
- SIGHASH_NONETransactions & feesSIGHASH_NONE is the flag that signs the inputs of a transaction while committing to none of its outputs, which leaves the destination of the money open to anyone who handles it.
- SIGHASH_SINGLETransactions & feesSIGHASH_SINGLE is the flag that ties a signature to one output only, the one sitting at the same position in the list as the input being signed.
- SignatureDigital signature
- Signature hashTransactions & feesThe signature hash is the digest a wallet actually signs: a rebuilt copy of the transaction, trimmed according to the flag chosen for that input, then hashed twice with SHA-256.
- Signature scriptDeveloper referenceA signature script is the unlocking data an input carries to satisfy the pubkey script of the output it spends, and on modern SegWit inputs it is empty.
- SignetNodes & softwareSignet is a test network whose blocks are only valid if a designated signer has signed them, which keeps its ten minute block schedule steady instead of erratic.
- Signing deviceHardware wallet
- Silent paymentsPrivacy & securitySilent payments let you publish one reusable address that never appears on the blockchain, because the sender uses it to compute a fresh, unlinkable destination for every payment.
- Silk RoadCulture & historySilk Road was the darknet market where bitcoin was the only accepted payment, and its 2013 takedown shaped how governments and banks saw the currency for years.
- SIM jackingSIM swap
- SIM swapPrivacy & securityA SIM swap moves your phone number onto a criminal's SIM card, handing them every SMS code and password reset that your exchange account and email depend on.
- SIM swappingSIM swap
- Simplified Payment VerificationNodes & softwareSimplified payment verification checks that a transaction sits in a block with real proof of work behind it, using only block headers and a merkle branch.
- SLIP39Shamir backup
- SlippageBuying & exchangesSlippage is the difference between the price you were quoted and the price your order actually filled at, and it grows with order size and thin liquidity.
- Social engineeringPrivacy & securitySocial engineering is the craft of getting a person to do the attacker's work for them: approving a transfer, reading out a code, or bypassing a rule they were trained to enforce.
- Soft forkProtocol & upgradesA soft fork tightens bitcoin's rules so that blocks valid under the new software are still valid under the old, letting the network upgrade without anybody being forced off the chain.
- Software walletWallets & custodyA software wallet is an app on a phone or computer that holds your keys in that machine's storage and signs transactions with the same processor that runs your browser.
- Solo miningMining & consensusSolo mining means pointing your machines at your own node and keeping the entire block reward when you win, accepting that you may never win at all.
- SplicingLightning & layer 2Splicing resizes an open Lightning channel by spending its funding output into a new, larger or smaller one, so the channel keeps its history and stays usable throughout.
- Spot bitcoin ETFMarkets & investingA spot bitcoin ETF is a listed fund that holds real bitcoin in custody and issues shares tracking its value, so brokerage accounts can hold exposure without keys.
- Spot ETFSpot bitcoin ETF
- SpreadBid-ask spread
- SPVSimplified Payment Verification
- SPV nodeLightweight client
- SSL signatureDeveloper referenceSSL signature is the name BIP70 gave to the bytes signing a PaymentRequest with a web server's certificate key, and the label was already a misnomer when it was written.
- StablecoinMarkets & investingA stablecoin is a token that promises to stay worth one unit of a national currency, usually a dollar, by holding reserves an issuer controls off the blockchain.
- Stacking satsCulture & historyStacking sats means accumulating bitcoin in small satoshi sized amounts on a regular basis, treating the 100 million unit subdivision of a coin as the thing you count.
- Stale blockMining & consensusA stale block is a fully valid block that lost the race: another block of the same height won, so the network built on that one and abandoned this one.
- Standard block relayNodes & softwareStandard block relay is the original way a new block travels between nodes: announce the hash, wait for the peer to ask, then send the entire block over the wire.
- Standard transactionTransactions & feesA standard transaction is one that ordinary nodes agree to relay and hold in their mempools, which is a stricter bar than merely being valid under the consensus rules.
- Start stringNodes & softwareThe start string is the four-byte prefix at the front of every bitcoin network message, and it names which network the sender is on before anything else is read.
- StatechainLightning & layer 2A statechain moves an entire bitcoin output from one owner to the next off chain, by handing over a key share while a server that co-signs promises to forget the old one.
- Steel backupMetal seed backup
- Stock-to-flowMarkets & investingStock-to-flow divides an asset's existing supply by the amount produced each year, and PlanB's 2019 model used that single number to forecast bitcoin's price.
- Stop lossStop-loss order
- Stop-loss orderBuying & exchangesA stop-loss order sits dormant until the price falls through a level you picked, then fires a sell into whatever market exists at that moment.
- Stratum V2Mining & consensusStratum V2 is the rewritten protocol between miners and pools that encrypts the connection and lets the miner, rather than the pool, choose which transactions go into the block.
- Stuck transactionTransactions & feesA stuck transaction is one that has been broadcast and accepted by nodes but keeps missing blocks, because the fee it pays sits below what miners are currently taking.
- Submarine swapLightning & layer 2A submarine swap trades on-chain bitcoin for Lightning bitcoin in one atomic step, using the same payment hash on both sides so neither party can take the money and run.
- Supply cap21 million supply cap
- Supply chain attackPrivacy & securityA supply chain attack reaches you through something you already trust: the wallet update you installed, the code library inside it, or the device a reseller shipped.
- SV2Stratum V2
T
- Taker feeMaker and taker fees
- TaprootProtocol & upgradesTaproot is the 2021 soft fork that gave bitcoin Schnorr signatures and a new output type where the cooperative spending path looks identical to an ordinary single-key payment.
- Taproot addressP2TR
- TapscriptProtocol & upgradesTapscript is the version of Bitcoin Script that runs inside Taproot script path spends, with Schnorr signatures, no opcode ceiling, and a signature budget in place of the old counters.
- TargetTarget threshold
- Target thresholdMining & consensusThe target threshold is the 256 bit number a block header hash must fall at or below for the block to count as valid proof of work.
- TestnetNodes & softwareTestnet is a parallel Bitcoin network whose coins are deliberately worthless, used by wallet and exchange developers to rehearse transactions before touching anyone's real money.
- Testnet4Testnet
- Thin clientLightweight client
- TokenBasicsA token is a unit of value issued inside someone else's blockchain by a contract or a metadata standard, which makes it something quite different from a chain's own native coin.
- Trading pairBuying & exchangesA trading pair is the two assets an exchange quotes against each other, written base first and quote second, so BTC/EUR prices one bitcoin in euros.
- TransactionBitcoin transaction
- Transaction feeTransactions & feesA transaction fee is the difference between what a bitcoin transaction spends and what it pays out, collected by whichever miner includes it in a block.
- Transaction hashTransaction ID
- Transaction IDTransactions & feesA transaction ID is the 64-character hexadecimal fingerprint of a bitcoin transaction, produced by hashing it twice with SHA-256, and it is how everyone refers to that payment.
- Transaction inputTransactions & feesA transaction input is the half of a payment that names one specific coin you already own and proves you are allowed to spend it, consuming it completely.
- Transaction malleabilityTransactions & feesTransaction malleability is the flaw that let a third party change a transaction's id without changing where the money went, by re-encoding the signature data it contained.
- Transaction mutabilityTransaction malleability
- Transaction outputTransactions & feesA transaction output is an amount of bitcoin plus the lock that decides who can spend it next, and it is the only place bitcoin actually exists.
- Transaction version numberTransactions & feesThe transaction version number is the first four bytes of a transaction, and it tells validators which optional rule sets, such as relative timelocks, apply to it.
- Travel RuleRegulation & taxThe Travel Rule requires the exchange sending your bitcoin to hand your name and account details to the exchange receiving it, the way banks pass details with a wire.
- TrustlessBasicsTrustless describes a system where you can verify the rules yourself instead of taking a counterparty's word for it, so no honest middleman is required.
- Two-factor authenticationPrivacy & securityTwo-factor authentication makes an account require a second proof besides your password, so a leaked or guessed password on its own no longer opens your exchange account.
- TxidTransaction ID
- TxInTransaction input
- TxOutTransaction output
U
- UASFUser-activated soft fork
- Uncompressed public keyAddresses & keysAn uncompressed public key writes out both coordinates of a curve point behind a 0x04 prefix, taking 65 bytes, and survives today mainly in keys generated before 2012.
- Unconfirmed transactionConfirmation
- Unhosted walletRegulation & taxAn unhosted wallet is the regulators' name for a wallet whose keys you hold yourself, the thing that sits outside the licensed perimeter and keeps getting rules written about it.
- Unique addressAddresses & keysA unique address appears in exactly one payment and is never handed out again, which is how every wallet built on BIP-32 behaves by default.
- Unlocking scriptSignature script
- Unrealized gainMarkets & investingAn unrealized gain is the profit shown in your account before you sell anything, a number that exists only at today's price and can vanish without you doing a thing.
- Unsolicited block pushNodes & softwareAn unsolicited block push is a peer sending you a block you never asked for, skipping the usual announce-and-request handshake to save a round trip on time-critical data.
- Unspent transaction outputUTXO
- URI QR codeDeveloper referenceA URI QR code is the square black and white pattern that encodes a bitcoin: URI, so a camera can read the address and amount that would otherwise be typed.
- User-activated soft forkProtocol & upgradesA user-activated soft fork enforces a new rule on a flag day chosen by node operators, so miners who ignore it find their blocks rejected rather than merely outvoted.
- UTXOTransactions & feesA UTXO is one unspent chunk of bitcoin sitting at an address, created whole by an earlier transaction and spendable only in full, never in part.
- UTXO consolidationPrivacy & securityUTXO consolidation is the housekeeping spend that sweeps many small coins in your wallet into one larger coin, paid for at today's fee rate so tomorrow's spend is cheaper.
V
- V2 blockVersion 2 block
- Vanity addressAddresses & keysA vanity address spells out a chosen word or prefix in its own characters, found by grinding through random keys until one of them encodes the pattern.
- VarIntCompactSize
- VASPVirtual Asset Service Provider
- vBVirtual byte
- vbyteVirtual byte
- Version 2 blockMining & consensusA version 2 block is a block whose header version field is 2, the upgrade that made BIP34 require the block's own height as the first item in its coinbase script.
- Virtual Asset Service ProviderRegulation & taxA Virtual Asset Service Provider is any business that exchanges, transfers, or safekeeps crypto for other people, the category the Financial Action Task Force created to pull exchanges into banking rules.
- Virtual byteTransactions & feesA virtual byte is the unit wallets price transactions in, equal to one quarter of a transaction's weight rounded up, so every fee quote reads in satoshis per vbyte.
- VolatilityMarkets & investingVolatility is the size and speed of bitcoin's price swings, routinely large enough that double-digit percentage moves in a single day arrive several times a year.
- voutOutput index
W
- WalletWallets & custodyA wallet is the software or device that stores your keys, watches the blockchain for outputs those keys control, and signs the transactions that spend them.
- Wallet Import FormatAddresses & keysWallet Import Format is the Base58 encoding used to move a single private key between wallets, wrapping the raw 32 bytes with a network byte and a checksum.
- Wash saleRegulation & taxA wash sale is a loss the tax code refuses to let you claim because you bought the same thing straight back, and the US rule still does not cover bitcoin.
- Watch-only addressAddresses & keysA watch-only address lets software follow a balance without holding the private key, so you can see every payment arrive and still cannot move a satoshi.
- Watch-only walletWatch-only address
- WatchtowerLightning & layer 2A watchtower is a service you pay or ask to watch the blockchain while your Lightning node is offline, ready to punish a channel partner who publishes an old balance.
- WBTCWrapped bitcoin
- Weight unitTransactions & feesA weight unit is the accounting unit that replaced the byte in bitcoin's block size limit, letting SegWit raise capacity without a hard fork by pricing signature data at a quarter.
- WhitepaperBitcoin whitepaper
- WIFWallet Import Format
- Withdrawal feeBuying & exchangesA withdrawal fee is what an exchange charges to send your bitcoin out to your own wallet, and it is usually a flat amount rather than the real network cost.
- Withdrawal whitelistBuying & exchangesA withdrawal whitelist restricts an exchange account to sending coins only to addresses you approved in advance, so a stolen password cannot redirect your bitcoin anywhere new.
- WitnessWitness data
- Witness dataProtocol & upgradesWitness data is the signature material a SegWit transaction carries in a separate section, discounted to one weight unit per byte and excluded from the txid entirely.
- Witness scriptDeveloper referenceThe witness script holds the real spending conditions of a P2WSH output and travels in the witness, where its bytes are weighted at a quarter of the usual cost.
- Wrapped bitcoinMarkets & investingWrapped bitcoin is an Ethereum token that a custodian issues against real bitcoin it holds, so the price tracks BTC while the ownership is a claim on a company.
- Wrapped SegWitNested SegWit
- WUWeight unit