Blockchain Dictionary !!
What is a Blockchain Dictionary?
Well, have you been overwhelmed with all the Blockchain jargons that are floating around in the Blockchain circuits? (I surely was when I started my Blockchain journey)
Blockchain diction can be intriguing and confusing at the same time. The primary reason being the nature of this technology—which still is in its very nascent state—which might feel a little daunting to begin with. But as one starts to absorb more and more of it’s nuances, things do get much easier.
A good logical point to begin your Blockchain journey is to get familiar with the Blockchain jargons that are widely being used in the industry.
So are you excited to learn about these Blockchain jargons and also have a bit of while do so??
If you replied with a “YES”, then without further ado lets begin with it!!
An “Address” is a unique alphanumeric identifier that is used to send or receive transactions on the Blockchain network. It is also referred to as the “Public Key”. The receiver shares this Address to the sender.
A vague analogy for the “Address” would be the Bank Account Number of an individual, to which the sender transfers the funds. On similar lines a sender sends the funds to the Public Key of the receiver. Having said that, (as mentioned earlier) its a very vague comparison only for the understanding purposes.
A Bank Account Number in most cases can be given to anyone, but the account balance remains abstracted from the public eyes.
But in the case of a Blockchain Address of a “Non-Privacy Blockchain”, for example Bitcoin or Ethereum to name a few, anyone who knows the public key can easily check the balance of that particular Address using Blockchain Explorers.
Although anyone can see the holdings against that particular public key, the funds can only be transacted by the person who holds the “Private Key” for the Address.
“Altcoins” or “Alternate Coins” are the crypto coins that were built as an alternative to the original cryptocurrency i.e. Bitcoin. Interestingly, apart from Bitcoin, every other crypto currency coin falls under this category. Generally Altcoins provide better features such as higher transaction speeds, lower transaction fees, lower latency, better privacy offerings etc.
Many Altcoins are a fork of the Bitcoin Blockchain with a few tweaks to it’s original Proof of Work (PoW) protocol. These altcoins bring in a number of notable changes to Bitcoin’s Blockchain. Following are some of the examples:
- A bigger Block size;
- Smaller Block generation time;
- A different total coins supply;
- Reduced mining fees
- Different hashing algorithms etc.
ASIC is an acronym for “Application Specific Integrated Circuit”. These are silicon chips that are specifically designed to process “SHA-256” hashing problems, in order to mine Bitcoins. The conventional CPUs & GPUs
A QR Code is a 2D graphic code that contains a sequence of data. These codes can be scanned by smart phones, and are used to encode bitcoin addresses and to assist bitcoin exchanges.
A satoshi is the smallest denomination of bitcoin that can be recorded on the blockchain. It is the equivalent of 0.00000001 bitcoin. It is named after the creator of Bitcoin, Satoshi Nakamoto.
Satoshi was the original creator of the Bitcoin Protocol back in 2008. He published a White paper on 31-Oct-2008 named “Bitcoin: A Peer to Peer Electronic cash system” and designed Bitcoin and created its original reference implementation, Bitcoin Core.
Nobody knows who Satoshi Nakamoto is and whether it is single person or group of people. Satoshi Nakamoto withdrew from the public in April 2011, leaving the responsibility of bitcoin network to a thriving group of volunteers.
SEPA is the Single European Payments Area; which is an EU-led agreement to make transferring funds between member states easier and thus make bitcoin exchanges go a bit smoother.
The Secure Hash Algorithm or SHA is a family of cryptographic hash functions published by the National Institute of Standards and Technology (NIST).
The SHA (Secure Hash Algorithm) is one of a number of cryptographic hash functions. A cryptographic hash is like a signature for a text or a data file. SHA-256 algorithm generates an almost-unique, fixed size 256-bit (32-byte) hash. Hash is a one way function – it cannot be decrypted back. SHA-256 Algorithm is used in the proof of work system of mining bitcoin
When private and public keys are hashed together they create a digital signature, which ascertains which address a bitcoin transaction came from.
Silk Road was an online marketplace that generally traded in cryptocurrencies for illicit purchases. It was shut down in 2013 after its owner, Ross Ulbricht, was arrested.
Simplified Payment Verification (SPV)
SPV or simplified payment verification is a method for verifying particular transactions were included in a block without the need to download the significantly-sized full block chain. Instead, users simply download the block headers.
A Softfork on a bitcoin blockchain introduces a change that is backward compatible. That means, it is not mandatory to upgrade in order to continue to use the Bitcoin Blockchain. You will not able to function certain things, which was implemented as part of the soft fork, but the fork can continue going forward and you can participate in the blockchain even if you do not upgrade.
Segregated Witness is a bitcoin protocol upgrade that improves scalability without increasing the block-size. This is done by separating the signature data from bitcoin transactions. It was a proposed soft fork which aimed to address bitcoin's scalability problem.
SegWit2x was an alternative software protocol which would result in a hard fork and an attempt to increase the block size from 1MB to 2MB. By increasing the block-size, the proponents of SegWit2x hoped they could mitigate fee increases. Whereas SegWit was a soft fork suggestion, SegWit2x was a hard fork proposal. SegWit2x aimed to keep all existing bitcoin users on one blockchain.
Stale Block are Blocks which were successfully mined but which were not added on the current best block chain because some other block at the same height had its chain extended first.
Blocks whose parent block has not been processed by the local node, so they can’t be fully validated yet.
The Testnet is an alternative blockchain network, to be used for testing. This allows application developers/testers to experiment, without having to use real/live cryptocurrencies or worrying about breaking the main live block chain.
Testnet coins are separate and distinct from the actual cryptocurrencies, and are never supposed to have any value.
In layman language, a ‘Transaction’ is the transfer of value from one address to another. In technical language, a transaction is a signed data structure expressing a transfer of value. Transactions are transmitted over the bitcoin network, collected and mined by miners, and included into blocks, made permanent on the blockchain.
Transaction pool is an unordered collection of transactions that are not in blocks in the main chain, but for which we have input transactions.
The transaction block is the record of transactions which are then collated and hashed, and then added to the block chain.
Each bitcoin transactions will have a fee imposed on them when sent across the network. This fees collected is handed over to the miner who has successfully hashed the block to make the transaction successful.
A program language is called “Turing complete”, if it can run any program that a Turing machine can run given the fact that it has sufficient time and memory.
Like Satoshi, UBTC or microbitcoin is another small denomination of bitcoin. It is the equivalent of 0.000001 BTC.
Wallet is software that holds all your bitcoin addresses and secret keys to each bitcoin, keeping them safe and free from fraudulent activity. Wallets are used to send, receive, and store your bitcoin.
A wire transfer is the favored method of sending and/or receiving currency from a bitcoin exchange. This transfer is conducted electronically, and can be secured to a bank account anywhere on the globe.
An anonymous protocol designed to keep the identities of cryptocurrency exchangers secret.