Seed (seed phrase) #
The 12 or 24 words that hold your private keys. Whoever has them can spend your bitcoin. They must be kept secret.
Private key #
The secret that authorizes spending. It’s derived from your seed and, with a signing device, never leaves it.
Public key #
The shareable counterpart of a private key. It can be used to check signatures and build addresses, but not to spend.
xpub (extended public key) #
A public key that can generate a whole family of related public keys, and therefore all the addresses of an account. Sharing it reveals that account’s addresses and balance, but doesn’t allow spending.
Derivation path #
The “address” of a key inside your seed, written like m/84'/0'/0'. One seed can produce many keys; the path says which one.
Fingerprint #
A short code that identifies a seed or signing device, often stored alongside keys in a descriptor.
Descriptor (output script descriptor) #
A description of a wallet: which public keys it uses and under which rules coins can be spent. Without it, software can’t find the coins of an advanced wallet. It’s private, not secret.
Wallet policy #
A more compact way of writing a descriptor, popular with signing devices (BIP 388). For this site, it plays the same role as a descriptor.
Multisig #
A wallet that needs signatures from several keys to spend, for example 2 out of 3.
Cosigner #
One of the people, or devices, holding a key in a multisig.
Miniscript #
A language for writing more advanced spending rules, such as “these two keys, or this one key after a year”.
Timelock #
A rule that lets coins, or a particular key, be spent only after a certain time.
MuSig #
A way for several keys to act as a single combined key on the blockchain, so only the combined key ever appears there.
Signing device (hardware wallet) #
A dedicated device that keeps private keys offline and signs transactions. It can always show its public keys.
Watch-only wallet #
A wallet app that holds only public information. It can track coins and prepare transactions but can’t sign them.
Labels #
Notes you attach to transactions and addresses (“rent”, “from Alice”). BIP 329 defines a standard format for them.
Encryption #
Scrambling data so that only someone with the right key can read it.
Decoy #
In BIP 138, a fake “envelope” added to a backup so that it doesn’t reveal how many real cosigners there are.
Padding #
Extra filler added inside an encrypted backup so its size reveals less about its contents.
Base64 #
A way to write data as plain letters and digits, so it can be pasted as text.
BIP (Bitcoin Improvement Proposal) #
A public document describing a proposed standard or change for Bitcoin. Many, like BIP 138, only describe formats for wallets and change nothing on the network.