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glossary.asciidoc

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+=== Quick Glossary
+
+This quick glossary contains many of the terms used in relation to bitcoin. These terms are used throughout the book, so bookmark this for a quick reference and clarification.
+
+address::
+((("bitcoin address")))
+((("address", see="bitcoin address")))
+((("public key", see="bitcoin address")))
+    A bitcoin address looks like +1DSrfJdB2AnWaFNgSbv3MZC2m74996JafV+. It consists of a string of letters and numbers starting with a "1" (number one). Just like you ask others to send an email to your email address, you would ask others to send you bitcoin to your bitcoin address.
+
+bip::
+((("bip"))) 
+    Bitcoin Improvement Proposals.  A set of proposals that members of the bitcoin community have submitted to improve bitcoin.  For example, BIP0021 is a proposal to improve the bitcoin URI scheme.
+
+bitcoin::
+((("bitcoin"))) 
+    The name of the currency unit (the coin), the network, and the software.
+
+block::
+((("block")))
+    A grouping of transactions, marked with a timestamp, and a fingerprint of the previous block. The block header is hashed to find a Proof-Of-Work, thereby validating the transactions. Valid blocks are added to the main blockchain by network consensus.
+
+blockchain::
+((("blockchain")))
+		A list of validated blocks, each linking to its predecessor all the way to the genesis block.
+	
+confirmations::
+((("confirmations")))
+		Once a transaction is included in a block, it has "one confirmation." As soon as _another_ block is mined on the same blockchain, the transaction has two confirmations, etc. Six or more confirmations is considered sufficient proof that a transaction cannot be reversed.
+
+difficulty::
+((("difficulty")))
+	A network-wide setting that controls how much computation is required to find a Proof-Of-Work.
+
+difficulty target::
+((("target difficulty")))
+ 	A difficulty at which all the computation in the network will find blocks approximately every 10 minutes.
+
+difficulty re-targeting::
+((("difficulty re-targeting")))
+	A network-wide recalculation of the difficulty that occurs once every 2,106 blocks and considers the hashing power of the previous 2,106 blocks.
+	
+fees::
+((("fees")))
+	The sender of a transaction often includes a fee to the network for processing the requested transaction.  Most transactions require a minimum fee of 0.5mBTC.
+
+hash::
+((("hash")))
+	A digital fingerprint of some binary input.
+
+genesis block::
+((("genesis block")))
+	The first block in the blockchain, used to initialize the crypto-currency.
+	
+miner::
+((("miner")))
+	A network node that finds valid Proof-Of-Work for new blocks, by repeated hashing.
+
+network::
+((("network")))
+	A peer-to-peer network that propagates transactions and blocks to every bitcoin node on the network. 
+	
+Proof-Of-Work::
+((("proof-of-work")))
+	A piece of data that requires significant computation to find. In bitcoin, miners must find a numeric solution to the SHA256 algorithm that meets a network-wide target, the difficulty target. 
+
+reward::
+((("reward")))
+	An amount included in each new block as a reward by the network to the miner who found the Proof-Of-Work solution. It is currently 25BTC per block.
+
+secret key (aka private key)::
+((("secret key")))
+((("private key", see="secret key")))
+	The secret number that unlocks bitcoins sent to the corresponding address.  A secret key looks like +5J76sF8L5jTtzE96r66Sf8cka9y44wdpJjMwCxR3tzLh3ibVPxh+.
+	
+transaction::
+((("transaction")))
+	In simple terms, a transfer of bitcoins from one address to another. More precisely, a transaction is a signed data structure expressing a transfer of value. Transactions are transmitted over the bitcoin network, collected by miners, and included into blocks, made permanent on the blockchain.
+
+wallet::
+((("wallet"))) 
+	Software that holds all your bitcoin addresses and secret keys. Use it to send, receive, and store your bitcoin.