GLOSSARY OF TERMS
There are currently 34 names in this directory
Bitcoin can refer to the protocol, network or the unit of currency. A Bitcoin with a capital “B” refers to the protocol & the network. A bitcoin with a lowercase “b” is a digital currency.
Blocks are packages of data that carry permanently recorded data on the blockchain network. Cryptography is used to protect the blocks.
A blockchain is a distributed digital ledger. Transparency is achieved on the blockchain because everyone on the network sees the same transactions and has a copy of the same ledger. A block is created once a certain number of transactions are added to the network. All of the blocks that were created are connected to each other (back to the first transaction); thereby creating a chain of blocks.
A situation in which a blockchain splits into two or more separate versions. The split occurs when the rulesets diverge. The split maybe temporary or permanent.
A method in which private keys are kept off of the Internet for safekeeping. Types of cold storage include USBs, sound wallets and hard wallets.
A decision making process whereby participants of the network reach an agreement that is beneficial to the entire group. Consensus is achieved when all participants agree that a block of transactions are valid. Consensus is required for the new block of transactions to be added to the chain.
A digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds
An acronym for Decentralized Applications. A DAPP is an open source software that runs on a P2P network. DAPPs are not owned or controlled by a single entity.
A permanent change to the blockchain whereby nodes that previously ran the old version of the blockchain will not be accepted until they upgrade to the latest version of the protocol software. A chain split occurs when the path follows the new upgraded blockchain and the other path continues using the previous ruleset.
Hard wallets are small, water proof & virus proof devices that are used for storing and safeguarding cryptocurrencies. They have become the preferred method of cold storage.
A method in which private keys are kept on the Internet. Types of hot storage are desktop, mobile and online.
An acronym for Initial Coin Offering. It is a method for a company (generally a start-up) to generate investments for a new cryptocurrency or token. Those investing in the ICO do not get a stake in the company, instead they take a risk on the success of the new currency. Essentially, they gamble that the new token will circulate and increase in value and therefore generate a profit for them.
An acronym for InterPlanetary File System. IPFS is a file system that is identified by hashes and used to retrieve and share data and links. Wikipedia describes it as "a peer-to-peer distributed file system that seeks to connect all computing devices with the same system of files".
A set of unconfirmed transactions stored by a node that have not yet been included in a block. Each node has its own MEMPOOL.
The participants of the network who provide computing power and validate transactions to get a reward.
Mining is the use of computers to validate transactions on the blockchain. Individuals who participate in this process are called miners. Their incentive for validating transactions is usually in the form of cryptocurrencies.
A node is an instance of software that participates in the peer-to-peer network. It validates and distributes transactions and blocks.
Acronym for Peer to Peer. P2P refers to interactions between two or more parties that are on a decentralized network. This allows participants of the network to deal directly with each other.
A unique identifier code that represents the private portion of a key pair. It can be used as a digital signature that is verifiable using the public portion of the key pair.
Smart contracts are essentially programming code that automatically executes tasks when certain conditions are met. The terms and conditions are defined, stored and run on the blockchain; they determine how digital assets can be used.
A change in the blockchain ruleset that does not deviate from the existing blockchain rules. Unlike a hard fork, an upgrade of the software protocol is not required for a soft fork. This is because the new rules are a subset of the old rules thereby allowing consensus to be maintained.
Acronym for Simplified Payment Verification. A method to verify transactions in a block without making a copy of the entire block.
A token is also referred to as a cryptocurrency. It is essentially a digital asset that represents a unit of value.
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