Glossary

Bitcoin Terms

Bitcoin Core : The reference implementation of Bitcoin full node software that sets the standard for Bitcoin protocol rules.

Block : A collection of transactions that has been verified by miners and added to the blockchain.

Blockchain : The public ledger that records all confirmed Bitcoin transactions in a sequence of blocks.

Confirmation : When a transaction has been included in a block by miners, it has one confirmation. Each subsequent block adds another confirmation.

Fee Rate : The cost of including a transaction in a block, measured in satoshis per virtual byte (sats/vbyte).

Hashrate : The computational power used to mine and process transactions on the Bitcoin network.

Mempool : The staging area where unconfirmed transactions wait to be included in a block.

Mining : The process of creating valid blocks by solving computational puzzles using specialized hardware.

Mining Pool : A group of miners who combine their computing power and share rewards.

P2WPKH (Pay to Witness Public Key Hash) : A modern Bitcoin address format (starting with "bc1") that uses Segregated Witness.

Replace-By-Fee (RBF) : A protocol that allows unconfirmed transactions to be replaced by a version with a higher fee.

Satoshi (sat) : The smallest unit of Bitcoin, equal to 0.00000001 BTC (one hundred millionth).

SegWit (Segregated Witness) : A Bitcoin protocol upgrade that changed how data is stored in blocks, enabling more transactions per block.

Transaction ID (txid) : The unique identifier of a Bitcoin transaction, represented as a 64-character hexadecimal string.

vbyte (Virtual Byte) : A unit of transaction size measurement that accounts for the SegWit discount.

Witness Transaction ID (wtxid) : Similar to txid but also includes the witness data; used primarily for transaction relay.

MEV Terms

Arbitrage : Exploiting price differences of the same asset across different markets.

Extractable Value : The profit miners can extract from transactions by reordering, including, or censoring them.

Frontrunning : When someone sees a pending transaction and executes their own transaction first to profit from the price impact.

MEV (Miner Extractable Value or Maximal Extractable Value) : The total value that can be extracted from transaction ordering within a block.

Sandwich Attack : A form of frontrunning where an attacker places orders both before and after a target transaction.

Metaprotocol Terms

BRC-20 : A token standard built on Bitcoin using the Ordinals protocol.

Layer 2 (L2) : Secondary frameworks or protocols built on top of the Bitcoin blockchain.

Metaprotocol : Protocols built on top of the Bitcoin base layer that add new functionality.

Ordinals : A protocol that allows for individual satoshis to be inscribed with arbitrary content.

Rollup : A scaling solution that processes transactions off-chain but posts transaction data on-chain.

Runes : A Bitcoin token protocol that uses the OP_RETURN field to create and transfer fungible tokens.

Shield-Specific Terms

Estimated Hashrate : The approximate percentage of Bitcoin network hashrate that will accept a transaction at a given fee rate.

Private Transaction Relay : The process of sending transactions directly to miners, bypassing the public mempool.

Shield Fee : The payment required to use Shield's private transaction relay service.

Shield Payment : An output in a transaction that pays the Shield service fee to the designated address.