Bech32 is a new address format introduced through Bitcoin Improvement Proposal (BIP) 0173. It emerged alongside the Segregated Witness (SegWit) innovation designed to increase the capacity of the Bitcoin network. Unlike older address formats such as Legacy (starting with the number “1”) or P2SH (starting with “3”), Bech32 offers a more modern and efficient solution. Bech32 addresses usually start with “bc1” for Bitcoin or “X-avax” for the Avalanche network. The structure of Bech32 consists of :

• Human-Readable Part (HRP) : The initial part that indicates a specific network or function, e.g. “bc1” for Bitcoin and “avax” for Avalanche.
• Separator : The “1” character that separates the HRP from the data part.
• Encoded Data : Information encoded in base-32 format.
• Checksum : An error-correcting code to verify the validity of an address.