GlossaryBeginner
Off-Chain
Activity or data that happens outside a blockchain's own public record.
"Off-chain" describes activity or data that happens outside a blockchain's own public, on-chain record, such as within a centralized exchange's internal systems or a separate database.
Off-chain activity can be faster and cheaper than on-chain activity, but it generally relies on trusting whoever operates the off-chain system, rather than being independently verifiable on the public network. See Kaavon's "On-Chain" glossary definition for the opposite case.
Examples
- Trades between two users on a centralized exchange's internal order book happen off-chain until a withdrawal occurs.
- Off-chain systems trade some transparency and trustlessness for speed and lower cost.