# Glossary

* Address: A Bitcoin address is like an account number, used to send and receive BTC. It's a string of letters and numbers derived from your public key.
* Block: A package of transactions, bundled together and added to the blockchain.
* Blockchain: The public record of all confirmed Bitcoin transactions, maintained by the decentralized network.
* Cold Storage: Refers to keeping Bitcoin keys offline, away from internet-connected devices. This is the most secure way to hold large amounts of Bitcoin long-term.
* Confirmation: A transaction is considered confirmed when it's included in a block added to the blockchain. Each subsequent block adds another confirmation. 6+ confirmations are considered very secure.
* Hardware Wallet: A physical device designed to securely store Bitcoin private keys. They offer the best balance of security and convenience for most users.
* Hash: A cryptographic function that takes data of any size and outputs data of a fixed size. Bitcoin uses the SHA-256 hashing algorithm.
* Lightning Network: A "layer 2" payment protocol built on top of Bitcoin, enabling fast, cheap, and scalable transactions.
* Mempool: The set of all unconfirmed transactions waiting to be included in the next block.
* Multisig: Short for multi-signature, a setup where more than one key is required to authorize a transaction. Often used for increased security or shared control of funds.
* Node: A computer participating in the Bitcoin network. Full nodes fully validate transactions and blocks.
* Private Key: A secret number that allows Bitcoin to be spent. Private keys can be thought of as the "passwords" to Bitcoin funds.
* Public Key: A number derived from the private key that can be shared with others. It acts as an "account number" for receiving Bitcoin.
* Seed Phrase: A list of words (usually 12 or 24) from which all of a wallet's private keys can be derived. It's a human-readable backup of a wallet.
* SegWit: Short for Segregated Witness, an upgrade to the Bitcoin protocol that changed the format of transactions to fix various bugs and allow for Lightning transactions.
* Signature: A cryptographic proof that a Bitcoin transaction has been authorized by the holder of the private keys.
* Taproot: A Bitcoin protocol upgrade that improves privacy, security, and efficiency of transactions. It enables more lightweight and flexible smart contracts.
* UTXO: Short for Unspent Transaction Output, it's an amount of Bitcoin received in a transaction that hasn't been spent yet. Your Bitcoin balance is the sum of all your UTXOs.
* Wallet: Software or a device that stores your Bitcoin keys and lets you interact with the Bitcoin network. It's like your Bitcoin "account".


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