Address
A string of letters and numbers that identifies where Bitcoin can be sent, like an email address for money.
Glossary
Bitcoin
A decentralized digital currency that operates without a central bank or single administrator.
Block
A bundle of Bitcoin transactions that are verified and permanently added to the blockchain together, roughly every ten minutes.
Block reward
The amount of new Bitcoin a miner receives for successfully adding a block to the blockchain.
Blockchain
A public, distributed ledger that records all Bitcoin transactions in chronological order.
Confirmation
Each new block added to the blockchain after your transaction's block, making the transaction progressively harder to reverse.
cypherpunk
A member of a 1990s movement that used cryptography to protect individual privacy and freedom online.
Double spending
The risk of spending the same digital money twice, which Bitcoin's design prevents.
ETF
An exchange-traded fund — a financial product that tracks an asset's price and trades on a stock exchange like a regular stock.
exchange
An online platform where people can buy and sell Bitcoin using traditional currency or other assets.
Fee
A small payment attached to a Bitcoin transaction that incentivizes miners to include it in the next block.
Fiat
Government-issued currency that is not backed by a physical commodity like gold.
Halving
An event that cuts the Bitcoin block reward in half approximately every four years.
hard fork
A non-backward-compatible change to Bitcoin's rules that creates a permanent split if not everyone upgrades.
Hashcash
A proof-of-work system invented in 1997 that requires a small computational puzzle to be solved before performing an action.
Inflation
A gradual rise in prices that reduces how much each unit of money can buy over time.
Ledger
A record of all financial transactions. In Bitcoin, the blockchain serves as a public, distributed ledger that anyone can verify.
Legal tender
A form of money that must be accepted for payment of debts by law.
Mining
The process of using computational power to verify transactions and add new blocks to the blockchain.
Node
A computer that stores a full copy of the Bitcoin blockchain and helps verify transactions and blocks.
Private key
A secret number that proves ownership of Bitcoin and authorizes transactions. Whoever holds the private key controls the funds.
Public key
A cryptographic key derived from your private key, used to generate Bitcoin addresses where others can send you funds.
Satoshi
The smallest unit of Bitcoin. 1 Bitcoin = 100,000,000 satoshis.
Scarcity
A limited supply that cannot be easily increased, making something more valuable as demand grows.
SEC
The U.S. Securities and Exchange Commission — the federal agency that regulates securities markets and investment products.
Seed phrase
A set of 12 or 24 words that serves as a master backup for all private keys in a Bitcoin wallet.
soft fork
A backward-compatible upgrade to Bitcoin's rules that tightens existing constraints without breaking older software.
Supply cap
The maximum number of Bitcoin that will ever exist: exactly 21 million.
Transaction
A transfer of Bitcoin from one address to another, recorded permanently on the blockchain.
Wallet
Software or a physical device that stores your private keys, giving you access to your Bitcoin on the blockchain.