Lesson 03 · make the words familiar

New words. Simple meanings.

This glossary gives short, plain-English meanings for 35 Bitcoin terms. No need to memorise everything: look up a word when you meet it.

A

Address: A destination for receiving bitcoin, usually a string of letters and numbers or a QR code. You can share it to receive a payment; it is not a secret key.

Backup: A safe copy of the information needed to restore a wallet. For many wallets this means recovery words, kept offline and private.
Bitcoin: A system for sending digital money without a bank handling each payment. A bitcoin is a unit of that money.
Bitcoin Core: Free, open-source software that checks Bitcoin's record and rules. It can also provide wallet features. It is not a separate coin.
Block: A group of payments added to Bitcoin's record, along with information linking it to the previous block.
Blockchain: The shared history of confirmed payments. Think of linked pages in a notebook, with many computers keeping copies.
BTC: The common short label for bitcoin, like a currency abbreviation. You can send a fraction of one BTC.

Cold storage: Keeping spending keys offline. It reduces some online risks, but still needs a careful backup and protection from loss or theft.
Confirmation: A sign that a payment has been included in a block. Each block added after that gives it another confirmation and makes changing its history harder.
Cryptocurrency: A broad name for digital money or assets that use cryptography and computer networks. Bitcoin is one example; other systems can have very different rules.
Custody: Who controls the keys needed to spend. A service may hold them for you, or you may hold them yourself.

Decentralised: Shared across many participants rather than controlled by one central operator. It does not mean every participant has the same role.
Digital signature: An approval made using a private key. Others can check that approval without seeing the secret key itself.

Fee: An amount included with a payment to encourage a miner to put it in a block. Fees can vary with demand for block space.
Fiat money: Money issued by a government, such as dollars or pounds. Bitcoin is not issued by a government.
Full node: A computer running software that checks blocks and payments against Bitcoin's rules for itself.

Hash: A short digital fingerprint calculated from some information. Changing the information changes the fingerprint; Bitcoin uses hashes to link blocks.
Hot wallet: A wallet whose spending keys are accessible on an internet-connected device. Convenience comes with risks from malware and device access.

Ledger: A record of payments. Bitcoin's ledger is public and checked by many computers.
Lightning Network: An additional payment network built around Bitcoin. It uses payment channels so that many payments do not each need a separate entry on the blockchain.

Mempool: A computer's waiting area for payments that have not yet been included in a block. Different computers can have different waiting lists.
Mining: Computing work used to propose new blocks. Other computers still check that each proposed block follows Bitcoin's rules.

Network: The connected computers that pass Bitcoin information between one another. Some check the rules, some mine, and some help send payments.
Node: A computer participating in the Bitcoin network. A full node checks the rules for itself.

Peer-to-peer: Participants communicating directly with one another instead of relying on one central server to handle everything.
Private key: Secret information that allows a wallet to approve spending. Anyone who gets it may be able to spend the bitcoin it controls.
Public key: Information used to check a digital signature. It is related to a private key, but does not reveal it. A receiving address is derived from public information, not the secret key.

Recovery phrase: Another name for the seed phrase: ordered words used by many wallets to restore their keys. Keep them private.

Satoshi: A small unit of bitcoin. One bitcoin contains 100 million satoshis. Often shortened to sat.
Seed phrase: An ordered list of recovery words used by many wallets to rebuild their keys. Often 12 or 24 words; follow your wallet's exact instructions.
Self-custody: Holding and managing your own spending keys. It gives you control and makes you responsible for backups and security.
Supply cap: The maximum amount allowed by the rules. Bitcoin's current rules limit the total supply to 21 million bitcoin.

Transaction: A record that transfers control of some bitcoin. Your wallet uses keys to approve it before sending it to the network.
Transaction ID: A digital identifier for a particular transaction. It can help you find the payment in the public record.

Wallet: Software or a device that helps manage keys and payments. It does not contain physical coins; the bitcoin is recorded on the blockchain.

See how the record, the rules, and the keys fit.