Bech32 (Native SegWit Address)
A Bitcoin address encoding format, recognizable by its 'bc1' prefix, built for SegWit transactions and designed to reduce transcription errors and lower fees.
Bech32 is a Bitcoin address encoding format, recognizable by addresses starting with "bc1," designed specifically for native SegWit (see Kaavon's "SegWit" glossary definition) transactions. Compared to Bitcoin's earlier address formats, Bech32 uses a character set and checksum design specifically built to catch typing or transcription errors more reliably, and it's case-insensitive, both of which reduce the risk of sending funds to a mistyped address.
Transactions using native SegWit Bech32 addresses are also typically cheaper to send from than those using older address formats, since SegWit's transaction structure reduces the effective data size counted toward a transaction's fee. Despite these practical advantages, Bech32 adoption took time to become universal across wallets and exchanges after its introduction, since every piece of software handling Bitcoin addresses needed to add explicit support for the new format before it could be used reliably everywhere.
Examples
- A Bitcoin address starting with 'bc1' is a Bech32-encoded native SegWit address, distinct from the older address formats starting with '1' or '3'.
- Sending a transaction from a native SegWit Bech32 address is typically cheaper than from an older address format, since SegWit reduces the effective data size counted toward the fee.