Blockchain Terms

Glossary of Blockchain Terms

Address: A unique identifier used to send and receive transactions on the blockchain. It typically represents a public key or a hashed version of it.

Algorithm: A step-by-step procedure or formula for solving a problem or performing a task, often used in cryptographic processes within blockchain technology, social media traction and business operations.

Altcoin: Any cryptocurrency other than Bitcoin.

Block: A collection of transactions that are grouped together and added to the blockchain for execution and listing in the blockchain public ledger.

Blockchain: A public distributed digital ledger that records transactions across many computers in such a way that the registered transactions cannot be altered retroactively.

Consensus Mechanism: Also known as Consensus Protocol. The process used to achieve agreement on a single data value among distributed processes or systems. Common mechanisms include Proof of Work (PoW) and Proof of Stake (PoS).

Cryptocurrency: A digital or virtual currency that uses cryptography for security and operates independently of a central authority.

Decentralization: The distribution of authority, functions, and processes across multiple nodes in a network, rather than being centralized in a single location.

Distributed Ledger Technology (DLT): A digital system for recording the transaction of assets in which the transactions and their details are recorded in multiple places at the same time.

Fork: A split in the blockchain network. Forks can be temporary (soft fork) or permanent (hard fork) changes to the blockchain protocol.

Gas: A unit that measures the amount of computational effort required to execute operations, such as transactions or smart contracts, on a blockchain platform like Ethereum.

Hash Function: A function that converts an input (or 'message') into a fixed-size string of bytes, typically a hash value that appears random.

Hashrate: The measure of computational power being used to process transactions and secure the blockchain network.

Initial Coin Offering (ICO): A fundraising mechanism in which new projects sell their underlying crypto tokens in exchange for bitcoin, ether, or other cryptocurrencies.

Ledger: A record-keeping system that maintains participants' account balances and transactions.

Mining: The process by which transactions are verified and added to the blockchain. In Proof of Work (PoW) systems, it involves solving complex mathematical problems.

Node: A computer that is connected to the blockchain network and participates in the validation and relaying of transactions.

Peer-to-Peer (P2P): A decentralized communications model in which each party has the same capabilities and either party can initiate a communication session.

Private Key: A cryptographic key that allows a user to access their cryptocurrency wallet and authorize transactions.

Public Key: A cryptographic key that can be shared publicly and is used in conjunction with a private key to verify the authenticity of a digital signature.

Smart Contract: A self-executing contract with the terms of the agreement directly written into lines of code, which run on the blockchain.

Token: A digital asset issued on a blockchain. Tokens can represent various assets, including utility, security, and currency tokens.

Transaction: An exchange or transfer of cryptocurrency from one address to another, recorded on the blockchain.

Wallet: A digital tool that allows users to store, send, and receive cryptocurrencies. It consists of a pair of keys: a private key and a public key.

Whitepaper: A document that outlines the technical details, features, and future potential of a blockchain project. It typically includes information on the project's purpose, architecture, tokenomics, and roadmap.