Glossário Bitcoin

Glossário Bitcoin

Um guia completo de terminologia Bitcoin — mais de 200 termos definidos e referenciados.

2-of-3 Multisig

A multi-signature configuration that requires two out of three private keys to authorize a Bitcoin transaction. This setup is commonly used for shared custody, escrow arrangements, and enhanced security where no single party has full control over the funds.

51% Attack

An attack on a blockchain network where a single entity or group gains control of more than 50% of the total hash power, allowing them to double spend coins, prevent confirmations, or reverse recent transactions. On Bitcoin, the immense hash rate makes such an attack prohibitively expensive.

Address

A string of characters derived from a public key that serves as a destination for Bitcoin payments. Addresses come in several formats including legacy (starting with 1), P2SH (starting with 3), and native SegWit/Bech32 (starting with bc1).

Altcoin

Any cryptocurrency other than Bitcoin. The term is short for 'alternative coin' and encompasses thousands of projects that launched after Bitcoin, each with varying degrees of technical differentiation.

ASIC

Application-Specific Integrated Circuit, a specialized hardware device designed solely for mining Bitcoin by computing SHA-256 hashes. ASICs are orders of magnitude more efficient at mining than general-purpose CPUs or GPUs.

Atomic Swap

A trustless exchange of one cryptocurrency for another without the need for a centralized intermediary. Atomic swaps use hash time-locked contracts (HTLCs) to ensure that either both parties receive their funds or neither does.

Base Layer

The foundational blockchain layer (Layer 1) of Bitcoin where all transactions are ultimately settled and secured by proof of work. It provides the security and finality guarantees upon which higher layers like the Lightning Network are built.

Base58

A binary-to-text encoding scheme used in Bitcoin to represent addresses and private keys in a human-readable format. It excludes visually ambiguous characters (0, O, I, l) to reduce transcription errors. Base58Check adds a checksum for error detection.

Batch Transaction

A single Bitcoin transaction that combines multiple payments to different recipients into one transaction. Batching reduces the overall fee cost and block space usage compared to sending individual transactions for each payment.

Bech32

A human-readable address encoding format introduced by BIP173 for native SegWit addresses. Bech32 addresses start with 'bc1' and offer better error detection, are case-insensitive, and result in lower transaction fees compared to legacy address formats.

BIP (Bitcoin Improvement Proposal)

A formal document proposing changes or additions to the Bitcoin protocol, software, or processes. BIPs follow a standardized format and undergo community review before adoption, serving as the primary mechanism for Bitcoin's decentralized governance and technical evolution.

BIP32

A Bitcoin Improvement Proposal that defines hierarchical deterministic (HD) wallets, allowing an entire tree of key pairs to be generated from a single master seed. This enables organized key management and simplified backups.

BIP39

A Bitcoin Improvement Proposal that defines the standard for generating mnemonic phrases (typically 12 or 24 words) from which a wallet's master seed is derived. These word lists enable human-readable backups of wallet keys.

Bitcoin Core

The reference implementation of the Bitcoin protocol, maintained as open-source software by a global community of developers. Bitcoin Core includes a full node, wallet, and mining capabilities, and serves as the de facto standard for protocol rules.

Bitcoin Script

A stack-based, non-Turing-complete programming language used to define the spending conditions of Bitcoin transactions. Scripts are embedded in transaction outputs and inputs, enabling features like multisig, timelocks, and hash locks.

Bitcoin

A decentralized, peer-to-peer electronic cash system created by Satoshi Nakamoto in 2008. Bitcoin uses proof of work, a fixed supply cap of 21 million coins, and a distributed ledger (blockchain) to enable trustless, censorship-resistant digital payments without intermediaries.

Block Explorer

A web-based tool that allows users to browse and search the Bitcoin blockchain, including viewing transaction details, block contents, address balances, and network statistics. Popular explorers include mempool.space and blockstream.info.

Block Header

An 80-byte data structure at the beginning of each block containing the version number, previous block hash, Merkle root of all transactions, timestamp, difficulty target, and nonce. Miners hash the block header repeatedly to find a valid proof of work.

Block Height

The sequential number assigned to a block in the blockchain, counting from the genesis block (block 0). Block height provides a simple way to reference a specific point in Bitcoin's transaction history.

Block Reward

The amount of newly minted bitcoin awarded to the miner who successfully mines a block. The reward started at 50 BTC and halves approximately every 210,000 blocks (about four years), creating Bitcoin's controlled supply schedule.

Block Size

The maximum amount of data that can be included in a single Bitcoin block. After SegWit, the limit is measured in weight units (4 million weight units per block), which translates to roughly 1-4 MB of data depending on the transaction types included.

Block Time

The average interval between blocks being mined on the Bitcoin network, targeted at approximately 10 minutes. The difficulty adjustment mechanism ensures this interval remains roughly constant regardless of changes in total network hash power.

Block

A data structure containing a set of validated transactions, a reference to the previous block, and a proof-of-work solution. Blocks are appended to the blockchain approximately every 10 minutes and form the permanent, ordered record of all Bitcoin transactions.

Blockchain

An append-only, cryptographically linked chain of blocks that forms a distributed ledger of all Bitcoin transactions. Each block references the hash of the previous block, making the historical record tamper-evident and immutable.

BOLT

Basis of Lightning Technology, the set of specifications that define the Lightning Network protocol. BOLTs describe the rules for opening and closing channels, routing payments, encoding invoices, and other aspects of Lightning interoperability.

Broadcast

The act of sending a signed Bitcoin transaction to the peer-to-peer network for inclusion in a block. Once broadcast, the transaction propagates across nodes and enters the mempool where miners can select it for confirmation.

Capacity (Lightning)

The total amount of bitcoin locked in a Lightning Network channel, representing the maximum value that can be transferred through that channel. Capacity is split between the two channel partners and shifts as payments flow in each direction.

Chain Analysis

The practice of examining Bitcoin blockchain data to trace transaction flows, identify address clusters, and de-anonymize users. Chain analysis firms provide surveillance services to governments and financial institutions, motivating privacy-enhancing techniques.

Change Address

An address controlled by the sender to which the unspent remainder of a transaction's inputs is returned. Since Bitcoin UTXOs must be spent in full, any excess value beyond the intended payment and fee is sent back to the sender as change.

Child Pays for Parent (CPFP)

A fee-bumping technique where a new transaction (child) spends an output of an unconfirmed transaction (parent) with a high enough fee to incentivize miners to confirm both transactions together. CPFP allows recipients to accelerate incoming payments.

Circular Economy

An economic model where bitcoin circulates within a community as a medium of exchange rather than being immediately converted to fiat currency. Participants earn, spend, and save in bitcoin, reducing dependency on traditional banking infrastructure.

Coinbase Transaction

The first transaction in every block, created by the miner to collect the block reward and transaction fees. It has no inputs (since the coins are newly created) and can include arbitrary data in its input field, as Satoshi did with the famous genesis block message.

CoinJoin

A privacy-enhancing technique where multiple users combine their transactions into a single joint transaction, making it difficult for outside observers to determine which inputs paid which outputs. Implementations include Wasabi Wallet and JoinMarket.

Cold Storage

A method of storing Bitcoin private keys on a device or medium that is not connected to the internet, providing protection against remote hacking and malware. Examples include hardware wallets, paper wallets, and air-gapped computers.

Confirmation

The inclusion of a transaction in a mined block, and each subsequent block added on top of it. More confirmations increase the security and finality of a transaction; six confirmations is traditionally considered highly secure for large amounts.

Consensus

The set of rules and mechanisms by which all Bitcoin nodes independently agree on the valid state of the blockchain. Consensus rules define which blocks and transactions are valid, ensuring network-wide agreement without a central authority.

Custodial Wallet

A Bitcoin wallet where a third party holds and controls the private keys on behalf of the user. While convenient, custodial wallets require trusting the provider with your funds and are subject to counterparty risk.

Cypherpunk

A movement and community of activists advocating for privacy and individual freedom through the use of strong cryptography. Bitcoin emerged from the cypherpunk tradition, building on decades of work on digital cash, cryptographic protocols, and decentralized systems.

Daemon

A background process that runs continuously on a computer, such as bitcoind (the Bitcoin Core daemon) which maintains a full node, validates transactions, and serves RPC requests. Daemons operate without a graphical interface and are typically used on servers.

Decentralization

The distribution of power, control, and decision-making across a network of participants rather than concentrating it in a single entity. Bitcoin achieves decentralization through its peer-to-peer architecture, open-source development, and proof-of-work mining.

Difficulty Adjustment

An automatic recalibration of the mining difficulty that occurs every 2,016 blocks (approximately two weeks). If blocks were mined faster than the 10-minute target, difficulty increases; if slower, it decreases, maintaining a stable block production rate.

Difficulty

A measure of how hard it is to find a valid block hash below the current target value. Higher difficulty means more computational work is required on average to mine a block, ensuring blocks are found approximately every 10 minutes.

Digital Signature

A cryptographic proof that the holder of a private key has authorized a transaction without revealing the key itself. Bitcoin uses ECDSA and Schnorr signature schemes to verify that transaction inputs are being spent by their rightful owner.

Discreet Log Contract (DLC)

A type of smart contract on Bitcoin that uses oracle-signed messages to settle conditional payments without revealing the contract details on-chain. DLCs enable bets, insurance, and financial derivatives while preserving privacy.

Double Spending

The attempt to spend the same bitcoin more than once by broadcasting conflicting transactions. Bitcoin's proof-of-work consensus and blockchain structure prevent double spending by establishing an authoritative ordering of transactions.

Dust

A very small amount of bitcoin in a UTXO whose value is less than or close to the fee required to spend it. Dust outputs are economically unspendable and can clutter the UTXO set, so nodes enforce a minimum output value (dust limit).

Ecash

A digital cash protocol based on blind signatures that provides strong privacy for users. In the Bitcoin context, Chaumian ecash mints like Cashu and Fedimint issue bitcoin-backed tokens that can be transferred privately without on-chain transactions.

Eclipse Attack

A network-level attack where an adversary isolates a Bitcoin node by monopolizing all of its peer connections, feeding it false information about the blockchain. This can facilitate double spending or prevent the node from receiving legitimate blocks and transactions.

Electrum

A lightweight Bitcoin wallet that connects to remote Electrum servers rather than running a full node. Electrum offers features like hardware wallet support, multisig, and coin control while maintaining a small resource footprint on the user's device.

Elliptic Curve Cryptography (ECC)

A public-key cryptography system based on the algebraic structure of elliptic curves over finite fields. Bitcoin uses the secp256k1 curve to generate key pairs and create digital signatures that prove ownership of funds.

Escrow

An arrangement where bitcoin is held by a neutral third party or locked in a multisig contract until predefined conditions are met. Bitcoin escrow can be implemented trustlessly using 2-of-3 multisig, where the escrow agent only intervenes in disputes.

Extended Public Key (xpub)

A key derived from an HD wallet's master seed that can generate all public keys and addresses in a particular derivation path without access to private keys. Sharing an xpub allows others to monitor balances and generate receiving addresses but not spend funds.

Faucet

A website or application that distributes small amounts of bitcoin (typically testnet bitcoin) for free, primarily used by developers for testing purposes. Mainnet Bitcoin faucets were common in Bitcoin's early days but are now rare.

Fee Market

The competitive market where Bitcoin users bid for limited block space by offering transaction fees. When demand exceeds supply, fees rise as users compete for inclusion; when demand is low, fees decrease. This market ensures efficient allocation of block space.

Fee Rate (sat/vB)

The transaction fee expressed as satoshis per virtual byte, which determines a transaction's priority for block inclusion. Higher fee rates result in faster confirmation times. Virtual bytes account for the SegWit witness discount.

Fee

The amount of bitcoin a sender pays to miners to incentivize the inclusion of their transaction in a block. Fees are calculated as the difference between total inputs and total outputs, and are typically expressed in satoshis per virtual byte (sat/vB).

Finality

The point at which a Bitcoin transaction is considered irreversible and permanently recorded in the blockchain. Bitcoin achieves probabilistic finality, where the likelihood of a transaction being reversed decreases exponentially with each additional confirmation.

Fork

A divergence in the blockchain or protocol rules. Forks can be temporary (when two miners find blocks simultaneously) or permanent (when protocol rules change). Protocol forks are classified as either soft forks (backward-compatible) or hard forks (non-backward-compatible).

Full Node

A Bitcoin node that downloads and independently validates every block and transaction against the complete set of consensus rules. Full nodes enforce the protocol without trusting any third party and contribute to network decentralization and security.

Fungibility

The property that every unit of a currency is interchangeable and indistinguishable from any other unit. Bitcoin's fungibility is imperfect because transaction history is publicly visible, leading to concerns about tainted coins and the need for privacy tools like CoinJoin.

Genesis Block

The first block of the Bitcoin blockchain (block 0), mined by Satoshi Nakamoto on January 3, 2009. It contains the famous embedded message: 'The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.'

GPU Mining

The use of graphics processing units to mine Bitcoin, which was common in Bitcoin's early years before being superseded by far more efficient ASIC miners. GPU mining is no longer competitive for Bitcoin but remains viable for some other proof-of-work cryptocurrencies.

Halving

A pre-programmed event occurring every 210,000 blocks (approximately four years) that cuts the block reward in half. Halvings reduce the rate of new bitcoin creation, contributing to Bitcoin's disinflationary monetary policy and the ultimate supply cap of 21 million BTC.

Hard Fork

A backward-incompatible change to Bitcoin's consensus rules that makes previously invalid blocks or transactions valid. Hard forks require all nodes to upgrade and can cause a permanent chain split if not universally adopted.

Hardware Wallet

A dedicated physical device that stores Bitcoin private keys in a secure element and signs transactions offline, protecting keys from exposure to internet-connected computers. Popular hardware wallets include Trezor, Ledger, and ColdCard.

Hash Function

A mathematical function that takes an input of any size and produces a fixed-size output (hash) that is deterministic, fast to compute, and practically impossible to reverse. Bitcoin primarily uses SHA-256 and RIPEMD-160 for various purposes including mining and address generation.

Hash Power

The total computational power being used to mine and secure the Bitcoin network. Greater hash power means more energy is being expended to find valid blocks, making the network more resistant to attacks.

Hash Rate

The number of hash computations performed per second by a miner or the entire Bitcoin network, measured in hashes per second (H/s). The network hash rate is a key indicator of mining competition and overall security.

Hash

A fixed-length output produced by a hash function from an arbitrary input. In Bitcoin, hashes serve as unique identifiers for blocks and transactions, form the basis of proof of work, and link blocks together in the blockchain.

HD Wallet

A hierarchical deterministic wallet that generates all key pairs from a single master seed using the BIP32 standard. HD wallets simplify backup (only the seed needs to be stored) and enable organized key management with multiple accounts and address chains.

HODL

A popular Bitcoin community term meaning to hold bitcoin long-term rather than selling, originating from a misspelling of 'hold' in a 2013 Bitcoin forum post. It has become a defining cultural ethos of the Bitcoin community.

Hot Wallet

A Bitcoin wallet connected to the internet, offering convenience for frequent transactions but with greater exposure to potential hacks and malware. Hot wallets are suitable for smaller amounts used in day-to-day spending.

HTLC

Hash Time-Locked Contract, a conditional payment mechanism used in the Lightning Network and atomic swaps. An HTLC locks funds that can only be claimed by providing a cryptographic preimage before a timeout expires, enabling trustless multi-hop payments.

Immutability

The property of the Bitcoin blockchain that makes confirmed transactions extremely difficult to alter or reverse. Immutability is achieved through the cumulative proof-of-work securing the chain, where modifying any past block requires redoing all subsequent work.

Inflation

In the Bitcoin context, the gradual increase in the total supply of bitcoin through block rewards, which decreases over time due to halvings. Bitcoin's inflation rate is programmatically defined and trends toward zero as the 21 million coin supply cap is approached.

Input

A reference to a previous transaction output (UTXO) being spent in a new transaction. Each input includes the transaction ID and index of the UTXO being consumed, along with a script or witness data that satisfies the spending conditions.

Invoice (Lightning)

A payment request on the Lightning Network encoded as a string (typically starting with 'lnbc') that contains the payment amount, destination, payment hash, expiry time, and routing hints. Invoices are generated by the recipient and shared with the payer.

JoinMarket

A decentralized CoinJoin implementation that creates a marketplace where makers offer liquidity for CoinJoin transactions and takers pay a small fee to use that liquidity. JoinMarket improves Bitcoin privacy without relying on a central coordinator.

Key Pair

A mathematically linked pair of cryptographic keys: a private key (kept secret) used to sign transactions and a public key (shared openly) used to verify signatures and derive addresses. The private key can generate the public key but not vice versa.

KYC

Know Your Customer, regulatory requirements that compel financial service providers to verify the identity of their users. In the Bitcoin space, KYC typically involves providing government ID and personal information to exchanges, which raises privacy and surveillance concerns.

Layer 1

The Bitcoin base protocol and its blockchain, where all transactions are ultimately settled and secured by proof of work. Layer 1 prioritizes security and decentralization, with scalability addressed by higher layers.

Layer 2

Protocols built on top of the Bitcoin base layer that enable faster and cheaper transactions while inheriting the security of the underlying blockchain. The Lightning Network is the most prominent Layer 2 solution for Bitcoin.

Ledger

A record of all transactions and account balances. Bitcoin's blockchain serves as a decentralized public ledger that is maintained by thousands of nodes worldwide, providing a transparent and verifiable history of all bitcoin transfers.

Lightning Channel

A two-party payment channel on the Lightning Network created by locking bitcoin in a 2-of-2 multisig on-chain transaction. Once open, the channel allows the two parties to make unlimited fast, low-cost payments between each other off-chain.

Lightning Invoice

A BOLT 11-encoded payment request on the Lightning Network that specifies the amount, destination, payment hash, and expiry. Lightning invoices are typically represented as QR codes or text strings and are single-use by design.

Lightning Network

A Layer 2 payment protocol built on top of Bitcoin that enables instant, low-cost transactions through a network of bidirectional payment channels. Payments are routed through multiple channels using HTLCs, settling on the Bitcoin blockchain only when channels are opened or closed.

Lightning Node

Software that participates in the Lightning Network by opening channels, routing payments, and maintaining channel state. Popular implementations include LND, Core Lightning (CLN), and Eclair. Running a Lightning node enables earning routing fees.

Liquidity

In the Lightning Network context, the availability of funds in payment channels to route transactions in a given direction. Inbound liquidity refers to funds on the remote side that can receive payments, while outbound liquidity refers to local funds available to send.

LNURL

A set of protocols that simplify Lightning Network interactions by encoding payment flows into simple HTTP links or QR codes. LNURL enables features like static payment links (LNURL-pay), withdrawals (LNURL-withdraw), and authentication (LNURL-auth).

Locking Script

The script placed in a transaction output that defines the conditions required to spend the associated bitcoin. Also known as scriptPubKey, it typically specifies a public key hash or script hash that the spender must satisfy.

Mainnet

The primary Bitcoin network where real value is transacted. Mainnet is distinguished from test networks (testnet, signet, regtest) which use valueless coins for development and testing purposes.

Market Capitalization

The total market value of all existing bitcoin, calculated by multiplying the current price per bitcoin by the total number of coins in circulation. Market cap is a commonly used metric for comparing Bitcoin's size relative to other assets.

Mempool

The memory pool where each Bitcoin node stores valid but unconfirmed transactions waiting to be included in a block. Miners select transactions from the mempool based on fee rate, prioritizing higher-paying transactions when block space is scarce.

Merkle Root

A single hash at the top of a Merkle tree that cryptographically summarizes all transactions in a block. The Merkle root is included in the block header and allows efficient verification that a specific transaction is included in the block.

Merkle Tree

A binary tree of hashes where each leaf node represents a transaction hash and each non-leaf node is the hash of its two children. Merkle trees enable efficient and secure verification of transaction inclusion without downloading the entire block.

Miner

A participant in the Bitcoin network who uses computational power to find valid proof-of-work solutions and add new blocks to the blockchain. Miners are rewarded with newly created bitcoin (block subsidy) and transaction fees for their work.

Mining Difficulty

A numerical value that determines how much computational effort is required to produce a valid block hash. The difficulty adjusts every 2,016 blocks to maintain the approximately 10-minute average block interval regardless of total network hash rate.

Mining Pool

A group of miners who combine their hash power and share block rewards proportionally to each member's contribution. Mining pools reduce the variance in mining income, providing more predictable payouts for individual miners.

Mining

The process of using computational power to find a valid nonce that produces a block header hash below the current difficulty target. Mining secures the network, processes transactions, and introduces new bitcoin into circulation through block rewards.

Miniscript

A structured representation of Bitcoin Script that enables analysis, composition, and generic signing of spending conditions. Miniscript makes it easier to reason about complex scripts, verify their correctness, and build interoperable wallet software.

Mnemonic Phrase

A human-readable sequence of 12 or 24 words defined by BIP39 that encodes a wallet's master seed. The mnemonic phrase serves as a backup that can restore all keys and addresses in an HD wallet.

Multi-hop Payment

A Lightning Network payment that traverses multiple channels to reach the recipient when no direct channel exists between sender and receiver. Multi-hop payments use onion routing and HTLCs to maintain privacy and trustlessness across intermediary nodes.

Multisig

A Bitcoin transaction authorization scheme that requires multiple private keys to sign a transaction, expressed as M-of-N (e.g., 2-of-3 means 2 signatures from 3 possible keys). Multisig enhances security by eliminating single points of failure.

MuSig

A Schnorr-based multi-signature scheme that allows multiple signers to produce a single aggregate signature that looks identical to a regular single-key signature on-chain. MuSig improves privacy and reduces transaction size compared to traditional multisig.

Network Effect

The phenomenon where the value of a network increases as more participants join. Bitcoin benefits from strong network effects: as more users, merchants, developers, and miners participate, the utility and security of the network grows for all participants.

nLockTime

A field in a Bitcoin transaction that prevents it from being mined until a specified block height or Unix timestamp is reached. nLockTime is one of Bitcoin's oldest timelock mechanisms and is used in payment channels and other time-sensitive contracts.

Node

A computer running Bitcoin software that participates in the peer-to-peer network by validating and relaying transactions and blocks. Nodes enforce the consensus rules and maintain a copy of the blockchain, contributing to the network's decentralization.

Non-Custodial

A wallet or service where the user retains full control of their private keys and does not rely on a third party to hold funds. Non-custodial solutions embody the Bitcoin principle of 'not your keys, not your coins.'

Nonce

A 32-bit number in the block header that miners increment to produce different hash outputs when searching for a valid proof of work. Miners vary the nonce (and other fields) until the resulting block header hash falls below the difficulty target.

Nostr

Notes and Other Stuff Transmitted by Relays, a decentralized social protocol that uses cryptographic key pairs for identity. Nostr has strong ties to the Bitcoin community and integrates Lightning payments via features like zaps (tips sent to content creators).

Off-Chain

Transactions or data that are not recorded directly on the Bitcoin blockchain. Off-chain solutions like the Lightning Network process transactions outside the main chain for speed and cost efficiency while retaining the ability to settle on-chain if needed.

On-Chain

Transactions or operations that are recorded directly on the Bitcoin blockchain and validated by the full network of nodes. On-chain transactions provide the highest level of security and finality but are constrained by block space and confirmation times.

Onion Routing

A privacy technique used by the Lightning Network (and Tor) where payment information is encrypted in layers, with each routing node only able to decrypt the layer addressed to it. This prevents intermediary nodes from knowing the full payment path.

OP_RETURN

A Bitcoin Script opcode that marks a transaction output as provably unspendable while allowing up to 80 bytes of arbitrary data to be embedded in the blockchain. OP_RETURN is used for timestamping, asset protocols, and other data-anchoring applications.

Opcode

An operation code in Bitcoin Script that defines a specific instruction to be executed on the script stack. Bitcoin has over 100 opcodes covering stack manipulation, arithmetic, cryptographic verification, flow control, and other operations.

Open Channel

The process of creating a new Lightning Network payment channel by broadcasting a funding transaction that locks bitcoin into a 2-of-2 multisig address on-chain. Once confirmed, the channel is active and can be used for off-chain payments.

Oracle

An entity that provides external real-world data to Bitcoin smart contracts or Layer 2 protocols. Oracles are essential for Discreet Log Contracts (DLCs) and other conditional payment schemes that depend on off-chain information like price feeds or event outcomes.

Ordinals

A numbering scheme that assigns a unique serial number to each individual satoshi based on the order in which it was mined. The Ordinals protocol enables inscriptions (data attached to specific satoshis), which has been used to create NFT-like artifacts on Bitcoin.

Orphan Block

A valid block that is not part of the longest chain because another block at the same height was accepted by more of the network first. Orphan blocks occur naturally when two miners find valid blocks at nearly the same time.

Output Script Descriptor

A human-readable language for describing the scripts used in Bitcoin transaction outputs and their associated keys. Descriptors provide a standardized way to express complex wallet configurations, making it easier to import and export wallet data between software.

Output

A component of a Bitcoin transaction that specifies an amount of bitcoin and the spending conditions (locking script) required to use it. Unspent outputs (UTXOs) represent the current distribution of all bitcoin in the system.

P2P

Peer-to-peer, a network architecture where participants communicate directly with each other without a central server. Bitcoin's P2P network allows nodes to exchange transactions and blocks, ensuring the protocol operates without any single point of failure.

P2PKH

Pay-to-Public-Key-Hash, a standard Bitcoin transaction type where the output is locked to the hash of a public key. The spender must provide a matching public key and valid signature. P2PKH addresses start with '1' and are the original Bitcoin address format.

P2SH

Pay-to-Script-Hash, a transaction type where the output is locked to the hash of a script rather than a public key hash. P2SH addresses start with '3' and enable complex spending conditions like multisig without the sender needing to know the details.

P2TR

Pay-to-Taproot, the output type introduced by the Taproot upgrade (BIP341). P2TR addresses start with 'bc1p' and combine Schnorr signatures with MAST (Merkelized Alternative Script Trees) to enable more private and efficient complex spending conditions.

P2WPKH

Pay-to-Witness-Public-Key-Hash, a native SegWit output type that moves the signature data to the witness section of the transaction. P2WPKH addresses start with 'bc1q' and benefit from lower fees due to the SegWit witness discount.

Paper Wallet

A form of cold storage where Bitcoin private keys and addresses are printed on a physical piece of paper. While paper wallets were popular early in Bitcoin's history, they are now considered less secure than hardware wallets due to risks in generation and usage.

Partially Signed Bitcoin Transaction (PSBT)

A standardized format (BIP174) for passing unsigned or partially signed transactions between wallets and signing devices. PSBTs enable workflows where multiple parties or devices contribute signatures, supporting multisig, hardware wallet signing, and CoinJoin coordination.

Passphrase

An optional additional word or phrase combined with a BIP39 mnemonic to derive a different master seed, effectively creating a hidden wallet. The passphrase adds an extra layer of security, as the correct mnemonic alone cannot access the funds without it.

PayJoin

A privacy-enhancing transaction protocol where both the sender and recipient contribute inputs to a transaction, breaking the common-input-ownership heuristic used by chain analysis. PayJoin transactions look like ordinary payments on-chain, making them hard to detect.

Payment Channel

A two-party relationship enabling unlimited off-chain Bitcoin transfers between participants. Funds are locked on-chain in a multisig output, and balance updates are exchanged off-chain via signed commitment transactions. Only the opening and closing transactions appear on the blockchain.

Penalty Transaction

A transaction in the Lightning Network that allows a channel partner to claim all funds in a channel if the other party attempts to broadcast an outdated commitment transaction. The penalty mechanism, implemented via revocation keys, deters cheating.

Point of Sale

A system used by merchants to accept Bitcoin payments in person, typically generating a Lightning invoice or on-chain payment request displayed as a QR code. Bitcoin POS solutions include BTCPay Server, which allows merchants to accept payments without intermediaries.

Proof of Reserves

A cryptographic audit technique that allows a Bitcoin custodian to prove they hold sufficient reserves to cover their liabilities without revealing the full details of their holdings. This is typically accomplished using signed messages from known addresses or Merkle tree-based attestations.

Proof of Work

A consensus mechanism where miners expend computational energy to find a hash below a target difficulty, proving that real-world resources were consumed to create a block. Proof of work secures the Bitcoin network by making it prohibitively expensive to rewrite blockchain history.

Protocol

A set of rules and standards that govern how participants in the Bitcoin network communicate and reach consensus. The Bitcoin protocol defines everything from transaction and block formats to peer-to-peer messaging, difficulty adjustment, and supply issuance.

Pruned Node

A full node that validates all blocks and transactions but discards older block data to save disk space, retaining only the UTXO set and recent blocks. Pruned nodes still enforce all consensus rules but cannot serve historical block data to other nodes.

Public Key

A cryptographic key derived from a private key using elliptic curve multiplication. Public keys can be freely shared and are used to generate Bitcoin addresses and verify digital signatures, without compromising the secrecy of the associated private key.

QR Code

A two-dimensional barcode commonly used in Bitcoin to encode addresses, payment requests, and Lightning invoices for easy scanning with mobile devices. QR codes reduce transcription errors and streamline the payment process, especially at points of sale.

Raw Transaction

A Bitcoin transaction in its serialized hexadecimal format, containing all the data needed for validation and broadcast. Raw transactions can be constructed, inspected, and signed offline before being broadcast to the network.

Rebalancing (Lightning)

The process of adjusting the distribution of funds across Lightning Network channels to improve routing capacity. Rebalancing can be done by sending a circular payment through the network or using submarine swaps to shift liquidity between on-chain and off-chain.

Recovery Phrase

A sequence of words (typically 12 or 24) that can be used to restore a Bitcoin wallet and all its associated keys and addresses. Recovery phrases follow the BIP39 standard and are the most critical backup component for any HD wallet.

Regtest

Regression Testing mode, a local Bitcoin testing environment where blocks can be generated instantly on demand. Regtest runs a completely private blockchain, making it ideal for development, automated testing, and debugging without needing testnet coins.

Reorg

A blockchain reorganization that occurs when a node discovers a longer valid chain and switches to it, abandoning its previous chain tip. Reorgs can cause recently confirmed transactions to become unconfirmed, which is why multiple confirmations provide greater security.

Replace-by-Fee (RBF)

A mechanism (BIP125) that allows a sender to replace an unconfirmed transaction in the mempool with a new version that pays a higher fee. RBF is useful for fee bumping transactions that are stuck due to an initially low fee rate.

RGB Protocol

A smart contract system that uses Bitcoin and the Lightning Network for state management while keeping contract logic and data off-chain. RGB enables the issuance of tokens, NFTs, and other digital assets anchored to Bitcoin without bloating the blockchain.

Routing (Lightning)

The process of finding a path through the Lightning Network's graph of payment channels to deliver a payment from sender to recipient. Routing nodes forward payments and can earn small fees for providing this service.

RPC

Remote Procedure Call, an interface provided by Bitcoin Core and other node implementations that allows external software to interact with the node programmatically. RPC commands can query blockchain data, manage wallets, create transactions, and control the node.

Satoshi Nakamoto

The pseudonymous creator of Bitcoin who published the whitepaper in 2008 and released the initial software in 2009. Satoshi Nakamoto's true identity remains unknown, and they ceased public communication in 2011, leaving behind an estimated 1 million unmoved BTC.

Satoshi

The smallest unit of bitcoin, equal to 0.00000001 BTC (one hundred millionth of a bitcoin). Named after Bitcoin's creator Satoshi Nakamoto, satoshis (sats) are the base unit used for Lightning Network payments and increasingly in everyday transactions.

Sats

The colloquial plural of satoshi, the smallest unit of bitcoin (0.00000001 BTC). Denominating in sats is increasingly common as it makes small amounts of bitcoin more intuitive and accessible for everyday use and Lightning payments.

Schnorr Signature

A digital signature scheme activated on Bitcoin through the Taproot upgrade (BIP340). Schnorr signatures are mathematically simpler and more efficient than ECDSA, and their key property of linearity enables signature aggregation (MuSig), improving privacy and scalability.

Script

Bitcoin's stack-based programming language used to define the conditions under which a transaction output can be spent. Script is intentionally limited (non-Turing-complete) to ensure predictable execution and security.

Seed Phrase

A sequence of 12 or 24 words that deterministically generates all the private keys in an HD wallet. The seed phrase is the master backup for a wallet and must be stored securely offline, as anyone with access to it can control the associated funds.

SegWit

Segregated Witness, a soft fork upgrade activated in 2017 that separates (segregates) signature data (witness) from transaction data. SegWit fixes transaction malleability, enables the Lightning Network, increases effective block capacity, and reduces fees for compliant transactions.

SHA-256

Secure Hash Algorithm 256-bit, the cryptographic hash function used in Bitcoin's proof-of-work mining and various other protocol operations. SHA-256 produces a 256-bit (32-byte) digest and is applied twice (double SHA-256) in block header hashing.

Sidechain

An independent blockchain that is pegged to Bitcoin, allowing bitcoin to be transferred between chains. Sidechains can implement different features, consensus rules, or trade-offs while anchoring security back to the Bitcoin main chain through a two-way peg mechanism.

Sighash

A flag that determines which parts of a Bitcoin transaction are covered by a digital signature. Different sighash types (ALL, NONE, SINGLE, ANYONECANPAY) provide flexibility in how transactions can be modified after signing, enabling advanced use cases.

Signature

A cryptographic proof produced using a private key that demonstrates authorization to spend specific bitcoin. Bitcoin currently supports ECDSA and Schnorr signature schemes, both of which can be verified by anyone using the corresponding public key.

Signet

A Bitcoin test network where block creation is controlled by a set of authorized signers rather than permissionless mining. Signet provides a more stable and predictable testing environment than testnet, with consistent block times and no spam disruptions.

Silent Payments

A protocol for generating unique, one-time addresses for each transaction using a publicly shared static address, without any interaction between sender and receiver. Silent payments improve privacy by preventing address reuse while simplifying the payment experience.

Simplified Payment Verification (SPV)

A method described in the Bitcoin whitepaper that allows lightweight clients to verify transactions without downloading the full blockchain. SPV clients only download block headers and use Merkle proofs to confirm that a transaction is included in a block.

Soft Fork

A backward-compatible change to Bitcoin's consensus rules that tightens existing rules (making some previously valid blocks/transactions invalid). Non-upgraded nodes still accept new blocks, though they may not fully validate the new rules. SegWit and Taproot were soft forks.

Spending Condition

The set of requirements encoded in a transaction output's locking script that must be satisfied to spend the associated bitcoin. Spending conditions can include signatures, hash preimages, timelocks, or combinations thereof.

SPV Node

A lightweight Bitcoin node that verifies transactions using Simplified Payment Verification rather than downloading and validating the entire blockchain. SPV nodes are common in mobile wallets, trading lower security guarantees for reduced bandwidth and storage requirements.

Stacking Sats

The practice of regularly accumulating small amounts of bitcoin over time, often through dollar-cost averaging (DCA). The term reflects the Bitcoin community's focus on long-term savings in satoshis rather than trying to time the market.

Submarine Swap

An atomic exchange between on-chain bitcoin and Lightning Network bitcoin, allowing users to move funds between layers without trusting a third party. Submarine swaps use HTLCs to ensure the exchange is trustless and atomic.

Sweep Transaction

A transaction that consolidates all UTXOs from one wallet or address into a single output in a new wallet or address. Sweeping is commonly used when migrating to a new wallet, importing a paper wallet, or consolidating dust UTXOs.

Tainted Coins

Bitcoin that has been flagged or associated with illicit activity by chain analysis companies. The concept of tainted coins undermines Bitcoin's fungibility, as some services may refuse to accept coins with certain transaction histories.

Taproot

A major Bitcoin soft fork activated in November 2021 (BIPs 340-342) that introduces Schnorr signatures and Merkelized Alternative Script Trees (MAST). Taproot improves privacy by making complex transactions (multisig, timelocks) look identical to simple payments on-chain.

Tapscript

The updated script execution rules introduced by BIP342 as part of the Taproot upgrade. Tapscript modifies several opcodes and introduces new ones for use within Taproot script-path spends, enabling more flexible and efficient smart contracts on Bitcoin.

Testnet

A Bitcoin test network that mirrors the main protocol rules but uses valueless coins, allowing developers to experiment and test applications without risking real bitcoin. Testnet is a public network with its own blockchain, miners, and block explorer.

Timechain

An alternative name for the Bitcoin blockchain, emphasizing that it functions as a chronological chain of timestamped blocks. The term was used by Satoshi Nakamoto in early Bitcoin source code and has been revived by parts of the Bitcoin community.

Timelock

A restriction that prevents bitcoin from being spent until a specified time or block height is reached. Bitcoin supports absolute timelocks (nLockTime, OP_CHECKLOCKTIMEVERIFY) and relative timelocks (nSequence, OP_CHECKSEQUENCEVERIFY), which are essential for Lightning Network and other protocols.

Token

A digital asset issued on top of a blockchain. On Bitcoin, tokens can be created using protocols like RGB, Omni Layer, or Ordinals inscriptions, though Bitcoin's primary design prioritizes its native currency over token issuance.

Tor

The Onion Router, an anonymity network that encrypts and routes internet traffic through multiple relays to hide a user's IP address. Many Bitcoin and Lightning nodes use Tor to protect network privacy and resist censorship.

Trampoline Routing

A Lightning Network routing technique where a payment sender delegates pathfinding to intermediate 'trampoline' nodes that have better knowledge of the network graph. This reduces the computational burden on mobile and lightweight Lightning wallets.

Transaction Fee

The difference between the total value of a transaction's inputs and outputs, paid to the miner who includes the transaction in a block. Transaction fees compensate miners and will become the primary mining incentive as block subsidies diminish over successive halvings.

Transaction ID (TXID)

A unique 256-bit hash that identifies a specific Bitcoin transaction, computed by double SHA-256 hashing the serialized transaction data. TXIDs are used to reference transactions in inputs, block explorers, and application programming interfaces.

Transaction Malleability

A vulnerability where a transaction's ID could be changed without invalidating the transaction by modifying the signature data. SegWit fixed this issue by moving witness data outside the transaction hash calculation, enabling reliable transaction chaining for the Lightning Network.

Transaction

A signed data structure that transfers bitcoin from one or more inputs to one or more outputs. Transactions reference previous UTXOs, include scripts or witness data proving authorization, and are broadcast to the network for inclusion in a block.

Turbo Channel

A Lightning Network channel that can be used for receiving payments before the funding transaction has been confirmed on-chain. Turbo channels (also called zero-conf channels) accept the risk of the unconfirmed funding transaction to provide instant channel availability.

Unconfirmed Transaction

A Bitcoin transaction that has been broadcast to the network and is sitting in the mempool but has not yet been included in a mined block. Unconfirmed transactions have no guarantee of being finalized and can potentially be replaced or dropped.

UTXO Set

The complete set of all unspent transaction outputs at any given point in time, representing the current state of bitcoin ownership across the entire network. Every full node maintains and validates the UTXO set, which is essential for verifying new transactions.

UTXO

Unspent Transaction Output, the fundamental unit of bitcoin ownership. Each UTXO represents a specific amount of bitcoin locked by a script that defines who can spend it. Bitcoin's accounting model tracks the set of all UTXOs rather than account balances.

Vanity Address

A Bitcoin address that contains a human-readable pattern or word, generated by repeatedly creating key pairs until a desired prefix is found. Vanity addresses are computationally expensive to produce and are used for branding or personalization.

Vault

An advanced Bitcoin custody scheme that uses timelocks and multi-step spending conditions to add a recovery window during which unauthorized transactions can be clawed back. Vaults provide enhanced security for long-term bitcoin storage.

Verification

The process by which Bitcoin nodes independently check that transactions and blocks conform to all consensus rules before accepting them. Verification is the cornerstone of Bitcoin's trustless model, eliminating the need to rely on any third party.

Version Bits

A mechanism (BIP9) that uses bits in the block header's version field to signal miner readiness for proposed soft fork upgrades. Version bits allow multiple soft fork proposals to be signaled and activated independently and simultaneously.

Wallet

Software or hardware that manages Bitcoin private keys, generates addresses, creates and signs transactions, and tracks balances. Wallets range from simple mobile apps to complex multi-signature setups and do not actually 'store' bitcoin, which exists only on the blockchain.

Watch-Only Wallet

A wallet that can monitor addresses and balances but cannot sign or spend transactions because it does not hold private keys. Watch-only wallets are used for monitoring funds, generating receive addresses from an xpub, or preparing unsigned transactions for offline signing.

Watchtower

A service that monitors the Bitcoin blockchain on behalf of Lightning Network users to detect and respond to fraudulent channel closure attempts. If a counterparty broadcasts an old commitment transaction, the watchtower submits a penalty transaction to protect the user's funds.

Whale

A person or entity that holds a very large amount of bitcoin, whose transactions or market activity can significantly influence price and liquidity. Whale movements are often tracked by analysts as potential market-moving events.

Whitepaper

The original nine-page document titled 'Bitcoin: A Peer-to-Peer Electronic Cash System' published by Satoshi Nakamoto on October 31, 2008. The whitepaper introduced the concept of a decentralized digital currency secured by proof of work and laid the foundation for Bitcoin.

Witness Discount

A fee calculation rule introduced by SegWit that counts witness data at one-quarter the weight of non-witness data. This discount incentivizes moving signature data to the witness section, effectively increasing block capacity and reducing fees for SegWit transactions.

Witness

The signature and other data required to satisfy a transaction input's spending conditions, segregated from the main transaction data in SegWit transactions. Witness data is committed in the block but discounted in fee calculations, incentivizing SegWit adoption.

xpub

An extended public key that can derive all child public keys and addresses in a specific HD wallet derivation path. Sharing an xpub with a service or application allows it to generate addresses and track transactions without the ability to spend funds.

Yield

In the Bitcoin context, returns earned from activities like Lightning Network routing fees, lending bitcoin, or providing liquidity. The Bitcoin community generally cautions against yield schemes that introduce counterparty risk, referencing past failures and the saying 'if you don't know where the yield comes from, you are the yield.'

Zero-Confirmation Transaction

A Bitcoin transaction that has been broadcast but not yet included in any mined block. Accepting zero-confirmation transactions involves risk because they can potentially be double-spent, though this is mitigated in low-value scenarios and with proper monitoring.

Zero-Knowledge Proof

A cryptographic method that allows one party to prove knowledge of a value or the truth of a statement without revealing the underlying information. Zero-knowledge proofs have applications in Bitcoin privacy, sidechain verification, and scalability research.