#BITCOIN TERMINOLOGY 

Block

A group of transactions that are selected to be confirmed together and added to the timechain.

Block Height

The current length by count of blocks in the timechain. Starts at 0 for the Genesis block.

Coinbase

The transaction in each block that delivers the reward of newly issued bitcoin (subsidy) plus fees from included transactions to the miner that wins that block. Do not confuse this with the shitcoin casino that uses the same name.

Difficulty Adjustment

Regulates the pace of block production. Occurs every 2016 blocks, approximately every 2 weeks, and targets an average block time of 10 minutes. The adjustment increases and decreases mining difficulty according to the pace of blocks in the previous period. If blocks are too fast the difficulty is increased to slow them down. If blocks are too slow the difficulty decreases.

Epoch

Period of a particular level of Bitcoin's issuance via block subsidy. Each epoch lasts 210,000 blocks and concludes with a halving event.

Exchange Rate

Measurement of Bitcoin's trade value against another currency. Can be viewed in currency units per Bitcoin, or satoshis per currency unit. It should be noted that exchange rates do not exist in the protocol or on the network and are a purely external construct.

Fees

Fee rate estimates by priority. Every transaction pays a fee calculated by multiplying the data size of a transaction (vBytes) by the fee rate selected by the sender. Miners generally choose the transactions paying the highest fees. The rates displayed are a suggestion based on the fee rates of other currently unconfirmed transactions.

Halving

Regulates the supply of Bitcoin's issuance every 210,000 blocks (roughly every 4 years). Halves the previous epoch's issuance (subsidy) per block. Because the issuance of Bitcoin halves on this schedule, the eventual supply will be finite, totalling less than 21,000,000.

Hashrate

An estimate of the total computational power of all miners currently hashing on the Bitcoin network. Changes in hashrate can affect block times, influencing the direction and amount of the next difficulty adjustment.

Lightning Network Liquidity

Total bitcoin liquidity funding public channels on the Lightning Network. Lightning channels lock Bitcoin liquidity in multi-signature contracts on chain.

Mempool

Node memory storage of unconfirmed transactions. Transactions wait here to be chosen by a miner to be included in a block.

Mempool Depth

Rolling estimate of how many blocks currently unconfirmed transactions would fill.

Mempool Unconfirmed Transactions

Count of transactions in mempool waiting to be confirmed in a block.

Mempool Inflow

Volume in vBytes of new incoming transaction data every second.

Miners

A miner uses specialized computers to do SHA256 proof of work to compete for Bitcoin rewards. A winning miner gets the right to choose which transactions in mempool will be confirmed in the block and added to the timechain. This process is how transactions are made final and also how Bitcoin's supply is issued. The block reward (coinbase) includes the fees from all the selected transactions as well as newly issued bitcoin in the amount of the current subsidy.

Nodes

A node is a computer that connects to the peer-to-peer Bitcoin network using the core protocol to communicate with other nodes on the network. The content of newly mined blocks is shared and added to each node's record of the timechain of blocks. The consensus between all nodes is what secures the immutability of the history of transactions. A Bitcoin user running their own node relies on no 3rd party to confirm their transactions and holdings.

Proof of Work

Difficulty adjusted proof of work is essential to the functioning of the bitcoin network. "The chain with the most work is the truth, by definition. This is what we call Nakamoto consensus. [This works] because work requires energy. You can't cheat it. You can't argue with it. You can't lie about it. The proof that you did the work is self-evident in the outcome of the work." Read More

Sats

Abbreviation for Satoshis, the base unit and smallest division of bitcoin. One bitcoin is shorthand for 100 million sats. Less than 2.1 quadrillion total sats will ever be issued.

Subsidy

Portion of the block reward consisting of new supply issuance. The subsidy per block is halved at the end of each epoch.

Supply

The total issued units of Bitcoin. Less than 21 million bitcoin (2.1 quadrillion satoshis) will ever be issued.

Timechain

The authoritative chronology of confirmed blocks. An immutable record of transactions being audited and hardened with the addition of every new block.

Transaction (Tx)

A validly signed message to the network, communicating transfer of sats from an address or addresses controlled by the sender to one or many recipient addresses.

vBytes (vB)

Virtual measure of disk space or 'weight' of data in transactions and blocks.