Bilateral anchoring
Mechanism allowing the transfer of bitcoins between the main blockchain and a sidechain by locking funds on one chain to unlock them on the other.
A mechanism that establishes a connection between the main Bitcoin system and a sidechain (or a drivechain). Bilateral anchoring (commonly referred to as a two-way peg or 2WP) ensures a fixed value correlation between bitcoins on the main blockchain and the corresponding assets on the sidechain, enabling bitcoins to move between the two chains.
To achieve this, bitcoins are temporarily locked on the main blockchain, and an equivalent amount of assets is issued on the sidechain. This allows users to benefit from the specific advantages of the sidechain, such as faster transactions or enhanced privacy features, while preserving the value of the bitcoins used.
When users wish to return to the Bitcoin blockchain, the process is reversed: the assets on the sidechain are destroyed, and the corresponding bitcoins are unlocked. There are many different bilateral anchoring mechanisms that can rely on:
- A single trusted third party;
- A federation of entities; The miners of the main chain (drivechain).
TermDefinition
51% attack
An attack where a malicious actor controls more than half of the mining hash power, allowing them to manipulate transactions, notably by performing double spends.
Account
In an HD wallet, a derivation level (depth 3) allowing hierarchical organization of keys and addresses.
Activation method
The process by which the Bitcoin community decides to activate a soft fork, seeking consensus among miners and users to avoid a blockchain split.
Adaptor signature
A cryptographic technique linking a signature to a secret, such that publishing the signature reveals the secret. Useful for atomic swaps without a trusted intermediary.
Addr
An old Bitcoin network message that allowed communicating IP addresses of nodes accepting connections. Replaced by addrv2 (BIP155) to support longer address formats.
Addr.dat
An old file in Bitcoin Core that stored information about network peers. Replaced by peers.dat since version 0.7.0.
Address reuse
A discouraged practice of using the same Bitcoin address multiple times to receive payments, which harms privacy by allowing funds to be traced.
Address spoofing
An attack where a malicious actor creates an address closely resembling the victim's to deceive them and divert their payments.
Addrv2
A new network message format (BIP155) allowing the broadcasting of Bitcoin node addresses. Supports longer addresses such as Tor v3 or I2P.
Agorism
A libertarian political philosophy advocating economic action outside of state control (counter-economy) to progressively undermine state power.
Air cooling
A cooling system for mining machines using fans to dissipate heat. The most widespread and least expensive method.
Altcoin
Designates any cryptocurrency other than Bitcoin. A contraction of alternative and coin.
Aluvm
A virtual machine designed for deterministic execution of smart contracts, notably within the context of the RGB protocol on Bitcoin.
Analysis heuristic
An empirical method used to trace Bitcoin flows on the blockchain based on observable characteristics within transactions.
Ancestor mining
A principle whereby a miner selects transactions taking into account the fees of parent transactions, not only their own fees. Also called CPFP.
Anchor
In the RGB protocol, a set of data proving the inclusion of a commitment in a Bitcoin transaction, without publicly revealing its content.
Anchor outputs
A mechanism on Lightning allowing adjustment of the fees of a commitment transaction after its creation, to ensure quick channel closure.
Anchors.dat
A Bitcoin Core file storing IP addresses of nodes the client was connected to before shutdown, to facilitate reconnection on restart.
Anonsets (anonymity sets)
Indicators measuring the degree of privacy of a UTXO by counting the number of indistinguishable UTXOs in a set, typically after a coinjoin.
Anyprevout (apo)
A proposal (BIP118) adding new SigHash flags allowing the creation of signatures that do not cover any specific input of the transaction.
51% attack
An attack where a malicious actor controls more than half of the mining hash power, allowing them to manipulate transactions, notably by performing double spends.
Account
In an HD wallet, a derivation level (depth 3) allowing hierarchical organization of keys and addresses.
Activation method
The process by which the Bitcoin community decides to activate a soft fork, seeking consensus among miners and users to avoid a blockchain split.
Adaptor signature
A cryptographic technique linking a signature to a secret, such that publishing the signature reveals the secret. Useful for atomic swaps without a trusted intermediary.
Addr
An old Bitcoin network message that allowed communicating IP addresses of nodes accepting connections. Replaced by addrv2 (BIP155) to support longer address formats.
Addr.dat
An old file in Bitcoin Core that stored information about network peers. Replaced by peers.dat since version 0.7.0.
Address reuse
A discouraged practice of using the same Bitcoin address multiple times to receive payments, which harms privacy by allowing funds to be traced.
Address spoofing
An attack where a malicious actor creates an address closely resembling the victim's to deceive them and divert their payments.
Addrv2
A new network message format (BIP155) allowing the broadcasting of Bitcoin node addresses. Supports longer addresses such as Tor v3 or I2P.
Agorism
A libertarian political philosophy advocating economic action outside of state control (counter-economy) to progressively undermine state power.
Air cooling
A cooling system for mining machines using fans to dissipate heat. The most widespread and least expensive method.
Altcoin
Designates any cryptocurrency other than Bitcoin. A contraction of alternative and coin.
Aluvm
A virtual machine designed for deterministic execution of smart contracts, notably within the context of the RGB protocol on Bitcoin.
Analysis heuristic
An empirical method used to trace Bitcoin flows on the blockchain based on observable characteristics within transactions.
Ancestor mining
A principle whereby a miner selects transactions taking into account the fees of parent transactions, not only their own fees. Also called CPFP.
Anchor
In the RGB protocol, a set of data proving the inclusion of a commitment in a Bitcoin transaction, without publicly revealing its content.
Anchor outputs
A mechanism on Lightning allowing adjustment of the fees of a commitment transaction after its creation, to ensure quick channel closure.
Anchors.dat
A Bitcoin Core file storing IP addresses of nodes the client was connected to before shutdown, to facilitate reconnection on restart.
Anonsets (anonymity sets)
Indicators measuring the degree of privacy of a UTXO by counting the number of indistinguishable UTXOs in a set, typically after a coinjoin.
Anyprevout (apo)
A proposal (BIP118) adding new SigHash flags allowing the creation of signatures that do not cover any specific input of the transaction.