Bitcoin Terms Beginning with H

Every 210,000 blocks, the block subsidy is cut in half in an event known as the halving. This process will continue until the block subsidy is zero, at which point miners will only collect transaction fees and Bitcoin's inflation will hit absolute zero.

Bitcoin total supply will never exceed 21 million bitcoin. This policy gives Bitcoin its absolute scarcity.

A hard commodity is a subset of commodities, generally defined as anything that can be mined or extracted.

A Hard fork is a consensus change that is not backwards compatible. It requires that all nodes on a network upgrade in order to avoid splitting the network.

A hardware wallet is a digital device whose sole purpose is to generate and store public and private keys and sign transactions. Hardware wallets allow users to send and receive Bitcoin in a secure fashion.

A cryptographic hash function is a one-way, random mathematical function. Hash functions underlie Bitcoin's security model in several ways.

Hash rate is a measure of how many hashes miners cumulatively produce per second on the Bitcoin network. The hash rate indicates how much money, energy, and computing power is being dedicated to processing transactions and securing the network.

A Hashed Time Locked Contract is a timelocked Bitcoin transaction used on the Lightning Network to route payments between parties who do not share a Lightning Channel.

A hedge is an investment that reduces the risk of a portfolio. A hedge will normally offset returns from another investment in the portfolio.

Hexadecimal is an encoding scheme which uses a 16 character alphabet, including digits 0-9 and letters A-F. Most byte data is represented in hexadecimal, including Bitcoin public keys, transactions, hashes, and scripts.

A Hierarchical Deterministic Wallet is the term used to describe a wallet which uses a seed to derive many public and private keys. These keys are generated in a deterministic way, and are used to send and receive bitcoin.

Highest-in-first out cost basis method used to calculate capital gains and losses of Bitcoin sales. Bitcoin with the highest cost basis will be sold first.

HODL is an adage native to the Bitcoin community, derived simply from a misspelling of the word “hold”. It advises bitcoiners to remain stoic in the face of Bitcoin's extreme volatility.

A hot wallet is a Bitcoin wallet which connects to the internet. These wallets are more convenient for day-to-day spending, but are not as secure as cold storage.

The Howey test sets forth relevant factors to determine whether a security has been formed.

Hyperinflation is extremely rapid inflation. This normally occurs during economic instability, and is very destabilizing for an economy.

The process in which an asset owner provides an asset as collateral for a loan. The asset owner retains ownership and possession of the asset as long as the terms of the loan are met.