Pay-To-Public-Key-Hash (P2PKH)

Similar to Pay-To-Public-Key (P2PK) transactions, Pay-To-Public-Key-Hash only requires proof of ownership of the receiver. Unlike P2PK where the transaction is sent directly to the public address, P2PKH, as the name suggests, hashes the public target address. This provides more security for P2PKH transactions for sending and receiving funds on the Bitcoin blockchain. The public key stays hidden for other users. The hashed target address is shorter than the full public key. This so-called Bitcoin wallet address is different from the public key and provides easy error detection. With the first two characters of this address, it is possible to identify which network the wallet belongs to. The built-in checksum prevents funds from being sent to an invalid address.

The Advantages of P2PKH are its security and still relatively simplicity. Limitations are the increased complexity for implementations because of the additional steps that are required and the lack of SegWit compatibility. P2PKH is still one of the most used transaction types on the bitcoin blockchain.