Novice users are often overwhelmed by the amount of technical jargon they need to wrap their head around in the bitcoin world. Most of these terms will continue to be mentioned by community members on a regular basis. Below are some of the terms every bitcoin enthusiast should be aware of, as they are part of important cryptocurrency-related discussions.
Over the past few years, there have been a few alternative bitcoin developing solutions. BC, the abbreviation of Bitcoin Classic, is one of those development branches. This solution has little support from the overall bitcoin community right now, though.
Granted, this is one of the strangest abbreviations in the bitcoin world. UTXO stands for Unspent Transaction Output, which refers to a number of coins held by a specific wallet address.
Keeping in mind how there has been an increase in bitcoin transaction fees, users have to determine the appropriate transaction cost. A lower fee results in transactions potentially taking longer to confirm on the network. Replace-by-fee was introduced to allow users to rebroadcast a previous transaction but with a higher fee. This also nullifies the original transaction, as it is effectively “overwritten” by the new one.
One of the potential solutions to make bitcoin scale goes by the name Mimblewimble, sometimes abbreviated to MW. Check out this article to find out more about what Mimblewimble entails exactly.
Bitcoin Classic is one of the alternative branches of bitcoin development. BU, or Bitcoin Unlimited, is another alternative bitcoin solution. So far, it appears only a small portion of the bitcoin community supports this proposal, though.
One of the future bitcoin scaling solutions goes by the name of LN, also known as the Lightning Network. This particular proposal allows for bitcoin microtransactions to be bundled into one single transaction, reducing delays and excessive fees.
The scaling solution proposed by Bitcoin Core goes by the name of SegWit, also referred to as Segregated Witness. It is worth noting SegWit needs to be activated on the network before the Lightning Network can even come into the picture, though.
Novice bitcoin users will often come across the term HF, or hard fork. A bitcoin hard fork will effectively introduce a change to the bitcoin protocol that makes previously invalid blocks and transactions valid. A hard fork also requires all bitcoin users to upgrade their software client or they risk becoming cut off from the network altogether.
Not all bitcoin protocol changes are introduced in the form of a hard fork. Some changes can be introduced through a soft fork, abbreviated to SF. Interestingly enough, a soft fork makes previous valid blocks and transactions invalid. Soft forks are also backward compatible, and the majority of miners is required to upgrade to this new protocol.
There has been a lot of talk about the UASF – or user-activated soft fork – as of late. We explain the meaning the UASF in a separate article. Everyone who is part of the bitcoin ecosystem can activate this soft fork with their software client. It is an alternative proposal to have SegWit activate don the bitcoin network, although no specific activation dates have been put in place just yet.
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