People keep asking me about the different types of bitcoin addresses and what they mean. Here's a simple breakdown...
A lot of people have been asking me about the different types of bitcoin addresses they see in wallets and the difference between each of them. Understandability, for a nontech person, it can be a bit confusing to see different types of addresses in their wallet and what all of it means.
Here is a simple breakthrough of the types of addresses you see in your bitcoin wallet.
Legacy: This is the original form of a bitcoin address that has been in existence ever since bitcoin.
A simple way to recognize these addresses is they all start with a "1".
Example:
1BvBMSEYstWetqTFn5Au4m4GFg7xJaNVN2
Issues:
- Case-sensitive
- High transaction fee due to the large size
Segwit: The second version of the bitcoin address helped save in transaction fees by reducing the transaction size.
All of these addresses start with "3".
347N1Thc213QqfYCz3PZkjoJpNv5b14kBd
Issues:
- Case-sensitive
Native Segwit: The third edition of a bitcoin address. These addresses further reduce the fee and offer better usability by eliminating case sensitivity. They even offer an error-detection mechanism.
All addresses start with "bc1"
Example:
bc1qar0srrr7xfkvy5l643lydnw9re59gtzzwf5mdq
Issue:
- A bug was reported in its error detection mechanism
- Not very common with crypto exchanges
Bech32m: An updated version of native segwit, bech32m fixes the error that was in its previous version plus it supports taproot [a latest bitcoin technology development]
Issues:
- It's a new development so support is very limited.
Address compatibility:
By design, all addresses are compatible with each other. It's the wallets where the bitcoin address support varies.
Most popular wallets support all 3 address types, while some others only 1 or 2. It's best to pick the wallet that supports all 3 and will also provide support for bech32m in the future.
As for the address, bech32/bech32m offers the lowest fee.
Submitted December 18, 2021 at 11:22PM by primalfabric https://ift.tt/3p9UXA2
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