Working vocabulary
Glossary: the words we moor by
Each term is defined in plain language, with the sense in which this site uses it. Terms are grouped roughly in the order you will meet them.
Core ideas
- Balance
- The total of the unspent outputs that a set of keys can unlock. A wallet computes it; the protocol does not store it as one figure.
- Unspent transaction output (UTXO)
- An output that has been created and has not yet been used as an input. It is the unit of ownership in the Bitcoin ledger.
- Output
- A transaction's record of an amount and the lock that controls it.
- Locking condition
- The rule written into an output that says what must be provided before the output can be spent.
- Spent
- An output that a transaction has used as an input. A spent output cannot be used again.
Transactions
- Input
- A reference to one earlier output, together with the proof that its locking condition can be met.
- Signature
- A proof made with a private key, showing that the holder of that key authorized the spend.
- Change
- The part of a spend that returns to the payer as a new output, because outputs cannot be divided.
- Double spend
- An attempt to spend the same output in two conflicting transactions. The network accepts at most one of them.
Fees and selection
- Fee
- The difference between the total of a transaction's inputs and the total of its outputs. The party that includes the transaction keeps it.
- Coin selection
- A wallet's choice of which outputs to spend for a given payment.
- Consolidation
- Combining many outputs into one, usually to simplify later spending. It costs fees at the time it happens.
- Dust
- An output so small that spending it costs more than it holds under the fee conditions of the moment.
The network
- Node
- Software that checks every rule and keeps its own copy of the set of unspent outputs.
- Block
- A batch of transactions added to the ledger in sequence, each block linked to the one before it.
- Mempool
- A node's waiting area for transactions that have been broadcast but are not yet included in a block.
- Coinbase
- The first transaction in each block. It creates new bitcoin for the block producer and may collect the fees of that block.
- Address
- A short, encoded form of a lock that a payer uses to direct an output to you. The address is a convenience; the output is what carries the value.
- Satoshi
- The smallest unit of bitcoin. One hundred million satoshis make one bitcoin.
A note on these definitions
Not financial, legal, or medical advice. Definitions describe how the protocol works and how this site uses each term. They are not a recommendation about any holding, transaction, or amount.
Found a term that needs a clearer definition? Write to the harbor office and tell us which one.