GLOSSARY

Altcoins: bitcoin-alternatives that use their own Blockchain network, often with different protocols, to register transactions. [Introduction to Bitcoin & Cryptocurrencies]

Bitcoin: A decentralized, peer-to-peer (P2P) Blockchain network protocol that processes transactions without trusted intermediaries. [Introduction to Bitcoin & Cryptocurrencies]

bitcoin (BTC): The cryptocurrency unit operating on the Bitcoin network. [Introduction to Bitcoin & Cryptocurrencies]

Bitcoin White Paper: First introduction to Bitcoin published in October 2008 by Satoshi Nakamoto. [Introduction to Bitcoin & Cryptocurrencies]

Block: Blockchain transactions are recorded in information packages called blocks. Each block is chained to the previous block using hash-pointers through cryptography. These blocks act as an accounting ledger for all the activities on the Blockchain. [Blockchain Concepts]

Blockchain: A network of many distributed parties (nodes) who verify and validate transactions and arrive at a consensus on a distributed (replicated) database of records, known as the ledger. This eliminates the need for a central authority and replaces this with the Blockchain itself.  In a public Blockchain, anyone can join and process transactions, and all parties can interact with each other in a public and pseudo-anonymous manner. The information, once published on a Blockchain becomes immutable (i.e., is unchangeable). [Disruption, Digital Transformation & Blockchain]

Blockchain Wallet: A software that stores digital assets. It is a tool that generates and manages your public and private keys. [Introduction to Bitcoin & Cryptocurrencies]

Consensus: This is a decision-making process. Blockchains use numerous independent nodes to achieve consensus. In this process, members within a group agree on the fundamental purpose of the group. Consensus may encompass many areas, or it may be exclusively for only a few core areas. [Blockchain Concepts]

Cryptocurrency: This is a form of digital currency. Cryptocurrencies reside solely on Blockchain networks. They are issued out to miners for maintaining its Blockchain network and are transferred through the peer-to-peer Blockchain network. [Blockchain Concepts]

Cryptography: This is the practice of concealing information for only the intended reader. Blockchains use cryptography to secure data and the integrity of the Blockchain network. It is extremely difficult to reverse-engineer cryptography, thus ensuring data is not compromised. [Blockchain Concepts]

Distributed: Distributed reflects the topology meaning that each node on the network is connected to every other node on the network. As opposed to a centralized network, where all nodes connect to a central authority, or a decentralized network, wherein several different nodes are connected to several different central nodes.   [Blockchain Concepts]

Distributed Ledger: This is a type of database with multiple relay points for spreading the information. It consists of a continuous ledger, which spreads across many parties. Records are stored one after another in this ledger in a Blockchain network. [Blockchain Concepts]

Genesis Block / Block 0: First block in a Blockchain. [Blockchain Concepts]

Hash Function: A mathematical function which turns data into a unique fingerprint of that data called a hash. It’s a formula or algorithm which takes the input data and turns it into an output of a fixed length. It is nearly impossible to back-calculate the original data from the hash. If the input data changes in the slightest, the hash changes significantly. [Blockchain Concepts]

Immutable/Immutability: Blockchains have mechanisms to make the data stored in the ledger immutable. Even though data can be read and new data can be appended, the old stored data cannot be altered. Immutability forms the basis of majority of current Blockchain use-cases. [Blockchain Concepts]

Node: A computer that is connected to a Blockchain network. Nodes share the Blockchain with other nodes in a peer-to-peer fashion. They can process transactions and verify work done by other nodes. [Blockchain Concepts]

Nonce: A random and arbitrary number used to generate a hash to meet a certain level of difficulty. Each miner keeps on trying with different nonce value till the desired output is obtained. As this calculation requires time and resources, finding the block nonce value constitutes the proof-of-work. [Blockchain Concepts]

Metacoins/Colourcoins: Digital tokens that can be launched on top of the existing Bitcoin or Altcoin blockchain network. [Introduction to Bitcoin & Cryptocurrencies]

Mining: This is a process by which transactions are verified and added to the Blockchain. Involves solving complex cryptographic algorithms using computational power. It triggers the release of cryptocurrencies as a reward for the miner. In Bitcoin, successfully mining a new block results in the miner being rewarded with freshly minted bitcoins. [Blockchain Concepts]

Peer-to-Peer Network: Parties can transact, store and forward information directly with one another. [Blockchain Concepts]

Practical Byzantine Fault Tolerance (PBFT): Each node publishes a public key. A Message coming through the node is signed by the node to verify its format. Once enough identical responses are reached, then the terms of consensus are met, such that the message is a valid transaction. [Decentralization & Consensus]

Programmable: Blockchains can be programmable (instructions contained inside blocks). Logic such as ‘if’ this occurs, ‘then’ do this, or ‘else’ do that. Allows transactions to be carried out only if certain conditions are met. [Blockchain Concepts]

Proof-of-Ownership: In Blockchain, this is shared and known by every “node” (computer). [Blockchain Concepts]

Proof-of-Stake: Proposed alternative to proof-of-work designed to increase network efficiency. Blocks are split relative to current wealth, so someone possessing 1% of the cryptocurrency currently in existence could "mine" 1% of the proof-of-stake blocks. [Decentralization & Consensus]

Proof-of-Work: Blocks require miners to solve complex math problems to validate transactions, add them to a block and publish the block onto the Blockchain, this reflects work done. The block solution (the hash of the block) is added to the subsequent block to create a chain of blocks. [Blockchain Concepts, Decentralization & Consensus]

Rai Stone: A very large stone that is used on the Island of Yap as currency. [Introduction to Bitcoin & Cryptocurrencies]

Round-Robin: Each node becomes a validator in a round-robin fashion. [Decentralization & Consensus]

Smart Contracts: These are transaction-processing codes executed on the Blockchain. They use the Blockchain to validate computing work done by network participants. They can represent other tokenized value on top of existing Blockchain infrastructure and are immutable once publised onto a Blockchain and the outcome of their execution cannot be changed. [Blockchain Concepts]

Time-Stamped: Blockchains are time-stamped. Useful for tracking and verifying information. [Blockchain Concepts]

Transparent Yet Pseudo-Anonymous: All transactions and values are public. Users can remain near-anonymous or selectively prove identity to others. [Blockchain Concepts]

 

 
 
 

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