Basis Points

A basis point is a unit equal to 0.01% (or one one-hundredth of a percent). You’ll often see the term shortened to "bps" or pronounced as “bips.” Basis points are commonly used in finance to express small percentage changes, such as interest rates, investment fees, or yield spreads. For example, an increase from 2.00% to 2.50% is a rise of 50 basis points.

It's worth noting that when people refer to "bips," they're talking about basis points—not Bitcoin Improvement Proposals (BIPs), which is a separate topic entirely.