Common questions about LayerZoo, Bitcoin education, Layer 2, self-custody, and the toolkits. Only one question is expanded at a time. The Jargon Buster is below with 50 terms and a search box.
Halving: Event every 4 years where the Bitcoin block reward is cut in half, reducing new supply.
Self-Custody: Holding your own private keys instead of using a third-party service.
Seed Phrase: 12-24 word backup that can recover your wallet.
Lightning Network: Layer 2 solution for fast, cheap Bitcoin payments.
Layer 2: Scaling solutions built on top of Bitcoin for speed and lower fees.
BitVM: Virtual machine that allows complex computation on Bitcoin without changing the base protocol.
Covenants: Proposed Bitcoin scripting upgrades that allow more powerful transaction rules.
Multisig: Requires multiple signatures to spend Bitcoin (e.g. 2-of-3).
Node: Computer that validates and relays Bitcoin transactions.
Hashrate: Total computational power securing the Bitcoin network.
Private Key: Secret key that controls access to your Bitcoin.
Public Key: Shareable address derived from your private key.
Wallet: Software or hardware that manages your keys and transactions.
Testnet: Testing network for Bitcoin and Layer 2 without real money.
Mainnet: The live Bitcoin network with real value.
UTXO: Unspent Transaction Output - the model Bitcoin uses for tracking ownership.
Block: Group of transactions added to the blockchain every 10 minutes.
Blockchain: The public ledger of all Bitcoin transactions.
Mining: Process of securing the network and creating new Bitcoin.
51% Attack: If one miner controls more than 50% of hashrate, they could potentially rewrite history.
Soft Fork: Backward-compatible upgrade to the Bitcoin protocol.
Hard Fork: Backward-incompatible change that creates a new chain.
SegWit: Segregated Witness - upgrade that increased block capacity and fixed transaction malleability.
Taproot: Upgrade that improves privacy and enables more complex smart contracts.
Lightning: Layer 2 for fast, cheap, private Bitcoin payments.
Ark: Layer 2 focused on instant, private payments without channel management.
Rootstock: EVM-compatible smart contracts secured by Bitcoin merge-mining.
Stacks: Smart contracts tied to Bitcoin with sBTC coming soon.
Citrea: Zero-knowledge rollup for Bitcoin.
sBTC: Synthetic Bitcoin on Stacks for smart contract use.
DeFi: Decentralized Finance - lending, borrowing, trading without intermediaries.
NFT: Non-Fungible Token - unique digital asset on the blockchain.
DAO: Decentralized Autonomous Organization - community governed by smart contracts.
DEX: Decentralized Exchange - peer-to-peer trading without a central authority.
Yield Farming: Earning rewards by providing liquidity to DeFi protocols.
Oracle: Service that brings real-world data to smart contracts.
Bridge: Mechanism to move assets between different blockchains.
Rollup: Layer 2 that batches transactions and posts them to the main chain.
Zero-Knowledge: Proof that allows verification without revealing the underlying data.
Covenant: Bitcoin scripting upgrade that restricts how coins can be spent in the future.
OP_CAT: Proposed opcode that enables covenants by allowing concatenation of data.
Vault: Smart contract that protects funds with time-locks and recovery keys.
CoinJoin: Privacy technique that mixes multiple users' transactions to break linkability.
Silent Payments: Privacy upgrade that allows reusable payment codes without on-chain linkage.
Taproot: Upgrade that improves privacy for complex scripts and multisig.
Schnorr Signatures: Efficient signature scheme enabled by Taproot for better privacy and multisig.
Mempool: Pool of unconfirmed transactions waiting to be included in a block.
RBF: Replace-By-Fee - ability to replace a transaction with a higher-fee version.
CPFP: Child-Pays-For-Parent - using a child transaction to pay for a stuck parent transaction.
Ordinals: Protocol for assigning unique numbers to satoshis for NFT-like collectibles.
Runes: Bitcoin-native fungible tokens using a new protocol.
BRC-20: Experimental fungible token standard on Bitcoin using Ordinals.