BIP173 refers to a Bitcoin Improvement Proposal that introduces a method for representing Bitcoin addresses in a way that is more user-friendly. It specifically focuses on the Bech32 address format, which is a type of Segregated Witness (SegWit) address.

Bech32 addresses are designed to be more resilient against common errors, such as mistyping. They only use lowercase letters and a limited set of characters, making them easier to read and input. This reduces the chances of sending funds to the wrong address.

Additionally, BIP173 helps in improving compatibility with wallets and services that may not fully support previous address formats. It also enhances the overall efficiency of transactions by reducing fees through the SegWit protocol, which allows for more transactions to fit into a single block.

In summary, BIP173 is an important step in making Bitcoin transactions more accessible and efficient, paving the way for wider adoption and usability.