A Bitcoin address is a unique identifier that serves as a virtuallocation where the cryptocurrency can be sent. People can send the cryptocurrency to Bitcoin addresses similarly to the way fiat currencies can often be sent to email addresses. However, the Bitcoin address is not intended to be permanent, but just a token for usein a single transaction. Unlike a digital wallet, a Bitcoin address cannot hold a balance.
The address itselfconsists of 26-35 alphanumeric characters. This string is the public half of an asymmetric key pair.The standard format for a Bitcoin address is P2PKH (pay to public key hash). Digital wallets or Bitcoin clientsgenerate addresses through cryptographic operations: Thesoftware generates a private key through an asymmetric signature algorithm and then derives the public key from the private one. The user signswith the private key and verifies that signature with the public key.
When Bitcoin first started, people could send the currency to an IP address. That was a convenient method for usersbut it quickly became apparent that it would also be convenient for people launching man-in-the-middle attacks. That method was discontinued and the Bitcoin address was devised as a more secure alternative.
Most other cryptocurrencies use similar technologies for funds transfer. The Bitcoin address is one type of blockchain address.
This was last updated in July 2018
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