PSBT (partially signed Bitcoin transaction)

PSBT stands for Partially Signed Bitcoin Transaction. The format is defined in BIP 174 from 2017. It is the shared ‘form’ passed back and forth between wallet app and signing device until all the required signatures are on it – even when the devices come from different manufacturers.^[1]

What it contains

A PSBT holds the planned transactionGlossaryTransactionA signed message that transfers bitcoin from existing outputs (UTXOs) to new outputs. It only counts as confirmed once it is in a block – and after that it can practically no longer be reversed.On the learning path: Stage 5 · Step 4 – First withdrawal →In the glossary →× and everything a signing device needs to check it: the amounts being spent, the recipient addresses, the fee and the derivation pathGlossaryDerivation pathThe route a wallet follows to calculate individual keys from your seed phrase, for example m/84'/0'/0'. If another wallet uses a different path when you restore, it looks empty – even though nothing has been lost.In the glossary →× to the matching key. There is no field for private keys.^[1] Anyone who intercepts a PSBT can’t spend anything with it, but they can see the payment details and, depending on the wallet, your xpubGlossaryxpub (extended public key)An extended public key from which all the addresses of a wallet account can be calculated. Nobody can spend bitcoin with it – but anyone who knows it can see your entire account history.In the glossary →×.^[1]

Typical uses

• Hardware wallet: the app creates the PSBT, the device signs it.
• Air gap: the PSBT travels to an offline device and back by QR code or as a .psbt file on a memory card.^[1],[2]
• Multisig: several participants sign the same PSBT one after another until enough signatures have been collected.

Always check the recipient and amount on the signing device’s display. Only there can you tell whether someone has altered the payment along the way.