21 million#
The most bitcoin there will ever be. That cap is written into the rules.
₿ Learn · Glossary
Bitcoin words, made simple
New words can make anything feel harder than it is. Here are 68 of the ones you'll hear most, in plain English. Search for a word, or tap a letter.
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A
Address#
A string of letters and numbers, often shown as a QR code, that people use to send Bitcoin to you. Think of it as the slot in your letterbox, or an email address for money. It's fine to share, and a fresh one for each payment is good for privacy.
All-time high (ATH)#
The highest price Bitcoin has ever reached. Handy to know, and not a sign of what comes next.
B
Bear market#
A long stretch, often months or a year or two, when prices keep falling and the headlines turn gloomy. Bitcoin has had several and has come back from each so far. That's history, never a promise.
Bitcoin (capital B)#
The whole system: the network, the rules and the software that keeps it running.
bitcoin (small b), BTC#
The money itself. One bitcoin can be split into 100 million tiny pieces called sats. BTC is its ticker, like AUD for the Australian dollar.
Block#
A bundle of transactions added to Bitcoin's shared record roughly every 10 minutes. Each one links to the one before it.
Block height#
The number of blocks so far, counting from the very first. It's how people mark time on Bitcoin, and how the halving is scheduled.
Block reward (subsidy)#
The new bitcoin a miner earns for adding a block, plus the fees in it. The new-coin part halves every 210,000 blocks.
Blockchain#
The chain of every block since 2009. A public record of every Bitcoin payment, copied on thousands of computers around the world.
Bull market#
A long stretch, often a year or more, when prices keep climbing and everyone seems excited. It's when people are most tempted to buy in a rush out of fear of missing out.
C
Cold storage#
Keeping your keys on something that never touches the internet, like a hardware wallet or written seed words. Some people use it for Bitcoin they plan to leave untouched for a while.
Confirmation#
When your payment is included in a block, it has one confirmation. Each new block on top adds another and makes it more settled.
Custodial wallet#
A wallet where a company holds the keys for you, like an exchange account. Easy to use, though you're trusting them to give it back.
Cypherpunks#
A group of privacy-minded programmers and thinkers who swapped ideas on a mailing list from 1992. Their work on digital cash and cryptography paved the way for Bitcoin.
D
DCA (dollar cost averaging)#
Buying a small, set amount on a regular rhythm, like A$20 every week, whatever the price. Also called stacking.
Difficulty#
How hard the mining puzzle is. Bitcoin adjusts it about every two weeks so blocks keep arriving roughly every 10 minutes.
Dispose (tax)#
In tax terms, selling, swapping, spending or giving away an asset.
E
F
H
Halving#
Every 210,000 blocks, about every four years, the new bitcoin paid to miners is cut in half. It's how Bitcoin's supply slowly tapers towards 21 million.
Hardware wallet#
A small device built to keep your keys offline and sign payments safely. Buy it direct from the maker, never second hand.
Hash rate#
The total computing power miners put into Bitcoin. A higher hash rate makes the network harder to attack.
HODL#
Holding your Bitcoin for the long run instead of trading. It began as a happy typo of 'hold' in a 2013 forum post.
Hot wallet#
A wallet app on a phone or computer that's connected to the internet. Great for spending money, best kept to smaller amounts.
I
Inflation#
When the amount of money grows faster than the real things it can buy, so each dollar buys a little less.
K
KYC (know your customer)#
The ID checks exchanges must do by law before you can buy. It links your name to your purchases.
L
Leverage#
Borrowing to make a bigger bet. It magnifies losses as well as gains. If the price moves the wrong way, the exchange can sell your bitcoin automatically, which is why falls can be so sharp.
Lightning channel#
A shared Lightning account between two parties, used to send many small payments.
Lightning Network#
A layer built on top of Bitcoin for fast, tiny, low-cost payments. Perfect for a coffee or a zap.
Low time preference#
Being willing to wait for something better later. The opposite of impulse.
M
Mempool#
The waiting room for payments that haven't made it into a block yet.
Miner#
A person or company running special computers that secure Bitcoin and add new blocks. They earn new bitcoin and fees for the work.
Mining#
The work of adding new blocks by solving a hard maths puzzle with lots of computer power. It keeps the record honest and releases new bitcoin.
Multisig#
Short for multi-signature. A wallet that needs more than one key to spend, like 2 of 3. Losing one key doesn't mean losing your savings.
N
Node#
A computer running Bitcoin's software. It keeps a copy of the record and checks every rule for itself. Anyone can run one.
Nostr#
An open social network that nobody owns. Your account is a key pair, so no company can lock you out. Many Bitcoiners use it.
npub#
Your public Nostr key. Share it freely so people can find and follow you.
nsec#
Your private Nostr key. It's the password to your Nostr account, and it can't be reset. Keep it secret.
O
OG#
Short for 'original gangster'. Someone who has been into Bitcoin since the early days, roughly before 2017, and stuck with it through every crash.
P
Passphrase#
An optional extra word you add to your seed words, sometimes called the 25th word. It adds protection, and if you forget it the money can't be reached.
Power law#
A theory that Bitcoin's price has followed a steady curve over time when drawn on a special chart. It's a pattern from the past, never a promise.
Private key#
The secret that lets you spend your Bitcoin. Your seed words create it. Whoever holds it controls the coins.
Proof of work#
The energy and computing power miners spend to add blocks. It's what keeps the record honest and open to anyone. See Mining.
Public key#
Made from your private key, and used to create addresses. Safe to share.
S
Satoshi Nakamoto#
The name used by the unknown person or group who created Bitcoin in 2008 and then stepped away.
Sats (satoshis)#
The smallest unit of bitcoin. There are 100 million sats in one bitcoin, so amounts can be very small.
Sea creatures (plankton to whale)#
Friendly community nicknames you may hear online. A plankton holds a small amount, and a whale holds a very large amount, usually 1,000 bitcoin or more. Starting small, with any amount, is perfectly fine.
Seed words (recovery phrase)#
A list of 12 or 24 words that can rebuild your wallet. Write them on paper, keep them safe and private, and never type them into a website or share them.
Self-custody#
Holding your own keys, so you control your Bitcoin directly. It means freedom and full responsibility.
Signing#
Proving with your private key that you approve a payment. A hardware wallet does this without the key ever leaving it.
SMSF#
Self-managed super fund: an Australian retirement fund you run yourself.
Sound money#
A description of how money is made: a fixed amount, released on a schedule, that nobody can change on a whim.
Stablecoin#
A digital token that aims to stay worth one dollar, or one unit of another currency. It's a promise from the company holding the reserves, so holding one means trusting that company.
Stacking sats#
A popular saying for building up small amounts over time. Another name for DCA.
T
U
UTXO#
Short for 'unspent transaction output'. Think of it as a coin or note in your wallet from a past payment. Your balance is all of them added up.
V
Volatility#
How much and how fast a price moves up and down. Bitcoin's price can be very volatile.
W
Wallet#
An app or device that holds your keys and lets you send and receive. The bitcoin itself lives on the blockchain.
Watch-only wallet#
A wallet that can see your balance but can't spend.
Whale#
Someone holding 1,000 bitcoin or more. Whales can move the price for a while when they buy or sell. See Sea creatures.
White paper#
A short document where someone sets out a new idea, the problem it solves and how it works. For Bitcoin, it means the nine-page paper Satoshi shared in 2008 explaining how Bitcoin would work. Read the white paper.
X
xpub#
An extended public key. It lets an app see all your addresses and balance, though it can't spend. Treat it as private, because it reveals your history.
Z
Zap#
A small Bitcoin tip sent over Lightning, often on Nostr, to say thanks for a post you liked.
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General information only, not financial advice.
