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.