Pay-to-Witness-Public-Key-Hash (P2WPKH) is one of several types of Bitcoin transactions used to spend funds on the Bitcoin network. P2WPKH is a version of “pay-to” transactions that utilize SegWit (segregated witness) and is compatible with all Bitcoin wallets currently able to transact on the network.
At a basic level, P2WPKH are transactions which only require the sender to know the public key of the recipient, but no other information about them. This enhances privacy as public keys are much less likely to be linked to identifiable information than other forms of transactions (for example, an address on the Bitcoin blockchain).
P2WPKH transactions are also advantageous when it comes to speed and efficiency. Instead of using addresses, a witness is used to identify the transaction which reduces the size of a transaction and improves its verification speed. By using a script inside a P2WPKH output, users are able to create a signature that can be verified without needing to parse or evaluate the entire transaction.
This means that any wallet maintaining a Bitcoin script cache will be able to verify the signature quickly. The move away from address-based transactions to P2WPKH continues to improve privacy and performance on the Bitcoin network. By making use of these new techniques, users can quickly, safely, and effectively send and receive funds without risk of identity theft.