Bitcoin Off-Chain Transactions: Their Invention and Use

Cite as: 4 GEO. L. TECH. REV. 685 (2020)

Bitcoin off-chain transactions are transactions in bitcoin that are not recorded on the blockchain.1 Today, most bitcoin transactions occur off-chain.2 This dynamic runs counter to the quintessential principle espoused in the initial white paper conceptualizing bitcoin—that transactions would be immutably and reliably recorded on a public ledger.3 As regulators voice concerns over bitcoin’s divorce from its ledger technology, this explainer provides an understanding of this innovation’s implications on privacy, security, settlement speed, and usability.

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Michelle Mount

Georgetown University Law Center, J.D. Candidate 2020; Boston University, B.S. Business and Finance.