SPV
Abbreviation with 2 meanings
| Stands for | Special purpose vehicle |
|---|---|
| Meanings | 2 |
| Categories | Business & Finance, Technology & Computing |
SPV has two meanings. It stands for Special purpose vehicle (finance) or Simplified payment verification (cryptocurrency & blockchain).
Meanings of SPV at a glance
| # | SPV stands for | Context |
|---|---|---|
| 1 | Special purpose vehicle | Business & Finance › Finance |
| 2 | Simplified payment verification | Technology & Computing › Cryptocurrency & Blockchain |
1. Special purpose vehicle
Business & Finance · Finance Abbreviations
Legal entity, usually a company or trust, created for a single narrow purpose such as holding an asset, financing a project or securitizing loans, so that its risks are isolated from the parent company. Lenders can be repaid from the SPV's assets without claims on the sponsor.
Example: Each wind farm sits in its own SPV, so a default at one site cannot affect the others.
Also called a special purpose entity (SPE). SPVs are central to securitization, project finance, aircraft leasing and venture syndicates. Enron's misuse of off-balance-sheet SPEs led to tighter consolidation rules, including the variable interest entity model in US GAAP.
2. Simplified payment verification
Technology & Computing · Cryptocurrency & Blockchain Abbreviations
A method, described in the bitcoin white paper, that lets lightweight wallets confirm a transaction is included in a block by downloading only block headers and a short Merkle proof rather than the whole blockchain.
Example: The phone wallet uses SPV, so it syncs in seconds instead of downloading hundreds of gigabytes.
SPV wallets trust that the longest chain is valid, so they offer weaker guarantees than full nodes, and privacy can suffer because they reveal their addresses to the servers they query. In corporate finance, SPV means special purpose vehicle.
Related abbreviations
More finance abbreviations
- S&T – Sales and trading
- SAFE – Simple agreement for future equity
- SOTP – Sum of the parts
- SPA – Share purchase agreement
- TLB – Term loan B
- TSR – Total shareholder return
- TTM – Trailing twelve months
- TVM – Time value of money
See all 88 finance abbreviations →