BIP173

BIP173 is a Bitcoin Improvement Proposal that specifies the Bech32 encoding and the native SegWit address format. Published in 2017 as part of the effort to standardize Segregated Witness, it defines a human-readable part, a data portion, and a checksum-driven encoding into Bech32 strings. The design aims to improve error detection, reduce confusion in transcription, and enhance QR code usability for wallet addresses.

A Bech32 address consists of a human-readable part (HRP) that identifies the network, such as bc for mainnet or tb for testnet, followed by the character 1 and a data section. The data portion encodes the witness version and the witness program as five-bit values using a 32-character alphabet. The total length is limited to 90 characters, and the encoding includes a robust checksum to detect typographical errors.

Bech32 addresses are used for native SegWit outputs, including P2WPKH and P2WSH. On mainnet, these addresses typically begin with bc1, while on testnet they begin with tb1. Because Bech32 is not backward compatible with legacy Base58Check addresses, Bech32 adoption requires wallet and service support to recognize and validate these new addresses.

Impact and adoption of BIP173 have contributed to a broader deployment of SegWit by providing an address format that improves usability and error resilience. It remains a foundational standard for modern Bech32 SegWit addresses, with ongoing relevance for wallet software, node implementations, and exchanges that support native SegWit transactions.