A butterfly knot is a fixed loop tied in the middle of a rope. It's the knot of choice to form a fixed loop when making a rope tackle (trucker's hitch).
There are a number of other knots that do the same thing, but the butterfly knot tends to work better because it doesn't jam when strained and it's easy to untie.
Click here for a additional information and a complete treatment of this useful knot.
Step 1: Where Will It Be Tied?
Step 2: Form Loop 1
Form a large overhand loop (Loop 1).
Step 3: Form Loop 2
Twist Loop 1 forming a second overhand loop (Loop 2).
Step 4: Working With Loop 2
Pass Loop 2 under both Loop 1 and the Standing Part. (Loop 2 is now the "running end.")
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Step 5: Tying the Knot
Pass Loop 2 back over the Standing Part and down through Loop 1.
Step 6: Forming the Fixed Loop of the Butterfly Knot
Pull Loop 2 completely through Loop 1.
Step 7: Dress the Knot
Finish the butterfly knot by tightly pulling Loop 2 and both sides of the Standing Part.