Private keys, public keys and addresses
A private key is a very large secret number. From it, the wallet derives a public key, and from that, an address you can share to receive Bitcoin. The maths only runs one way: an address reveals nothing useful about the private key behind it.
Spending requires a signature produced by the private key. Nobody - not an exchange, not a court, not BlockByte - can produce that signature without the key. This is the single fact that reshapes estate planning for Bitcoin.
Seed phrases and derivation
Modern wallets do not ask you to back up individual keys. They generate a seed phrase - usually 12 or 24 English words drawn from a standard 2,048-word list - and derive every key in the wallet from it. Restore the words into compatible software and the entire wallet reappears.
That is why the seed phrase is the crown jewel. It is not a password to an account; it is the account. Anyone with the words has full spending power, immediately and irreversibly.
Passphrases are not passwords
Many wallets support an optional passphrase (sometimes marketed as a '25th word'). Adding one creates an entirely different wallet from the same seed. Forget the passphrase and the coins are unreachable even with a perfect seed backup.
In an estate context this is a double-edged tool: it defends against someone finding your written seed, and it is one of the most common causes of families recovering an empty wallet and assuming the Bitcoin was spent.
Wallet types, and what each means for your family
Custodial accounts on an exchange are a claim against a company. They have deceased-estate processes, and Australian exchanges must be registered with AUSTRAC, but they also carry counterparty risk.
Hardware wallets keep keys offline on a dedicated device; software or mobile wallets keep them on a connected device. Multisignature wallets split signing power across several keys. Only the last of these removes the single point of failure that destroys estates - which is why Chapter 3 exists.
Words your executor will meet
UTXO: an unspent chunk of Bitcoin, the accounting unit a wallet actually spends. Descriptor: the technical record describing how a wallet's keys combine, essential for restoring multisig. Derivation path: the numbering scheme that decides which keys a seed produces. Confirmations: how many blocks have buried a transaction.
An executor briefing that uses these terms without defining them is not a briefing. Write the glossary into the document itself.