Useful concepts that you need to know of blockchain

When I started in a web3 world I didn’t have a enough context. For it I write down for all of you.

The next is not a deep definition but I am sure that it permits you a good first approach with web3, specifically with blockchain from a programmer’s point of view.

Decentralization:

It consist in distributed the authority entities so that there is no single entity to get total control over a project by itself. In blockchain the decentralization have a fundamental role because the most of project are building with this mindset, to avoid the only one authority entity and centralized.

Blockchain:

It is a database that have registered all transactions that happens into a distributed computer network around the world.

Protocol:

Set of rules that figure out what structure and how is it transmitted information inside a blockchain.

Decentralized Autonomous Organization — DAO — :

DAO is a set of people working together with a common goal who use the blockchain technology to define a collaboration rules and take decisions through code allowing the responsibility to be not only a group of people.

Decentralized Application — Dapp — :

These are applications that use blockchain technology to exist in a distributed way into the computer network as nodes to be part of the blockchain. In this way, this application is not alive in a private and centralized server, but in a lot servers at the same time, being more resistant to failures, crashes and censorship.

Exchange:

Platform that allow change between cryptocurrency and national coins like dollar, peso, etc.

Decentralized Finance — DeFi — :

It is a ecosystem of financial services based on blockchain and cryptocurrency. Its function is to provide access to the financial services that you know such as loans. credits, investments, savings, insurance, payments, etc. but in decentralized way, without geographics limits, with operations 24/7 and full control of your assets.

Cryptocurrency:

It is a digital asset “cryptoasset” decentralized that can be used as payment method for transfer value from peer to peer. It is based on cryptography and blockchain technology. Every cryptocurrency has an own blockchain.

Token:

It is a digital asset “cryptoasset” that exist into a blockchain not owned, but another cryptocurrency. Tokens are built with code, due to these can have the function that their creator desires. Its can be used such as voting mechanisms, representing an artists works, objects in a videogames, etc.

Fork:

It is a bifurcation or branching of a blockchain. This process occurs when a part of community wants to have rules of consensus different and they cannot reach an agreement to continue with the same network, so they fork it by creating a new blockchain.

Consensus:

In blockchain the consensus refers to the coordination between all parts of the network to validate and authenticate the information that is part of itself. Each blockchain has a consensus protocol that define a game rules to know what information is stored in the records and what is not.

Governance:

It is a mechanism through which decisions-making in a project is distributed and allow different sectors of the community to have voice and vote.

Fintech:

It refers to the industry that uses information technologies to offer financial services.

Metaverse:

The metaverse concept is used to refers a experiences of digital realities that are intended to simulate the systems of social interactions that take place in the physical reality.

Assets vs. utility:

Assets, usually refers to the tokens or cryptocurrencies. In other hand, utility is used to talk about value and uses that this specific token have.

Initial Coin Offering — ICO — :

This is the moment when a new crytocurrency or token comes to market and it is available to buying and selling. It is used as mechanism to raise capital for all the projects behind this asset.