A Blockchain Terminology Concept Map
All my articles by topic.
There are many blockchain glossaries on the web. But how many concept maps can be found around? I tried to draw one with some simplifications (and omissions), purists don’t take it wrong!
How to read it
The diagram below shows a network of the main concepts defining the blockchain technology and related ecosystems. In addition, the most common relationships between these concepts are also reported.
The extended Glossary
Below is a glossary of the main blockchain terms and concepts. Not all of them have been included in the concept map, to avoid making it too difficult to read.
(Decentralised) Network: a set of nodes interacting with each other to exchange information and coordinate a common service.
- Heterarchy: an organization where the entities are unranked (non-hierarchical) or where they possess the potential to be ranked in a number of different ways.
- Testnet: a Network used by the developers community to experiment and test protocol advancements.
- Ledger: a register of transactions across peers.
- Centralised: a (digital) service owned by a single entity (company, organisation, private).
- Decentralised: a digital service provided by a number of distinct and possibly anonymous entities.
- Distributed: a digital service which is sharded across different nodes cooperating to offer a single service, but non necessarily decentralised.
- Trusted: a centralised service which requires trust which requires trust versus a single entity to be used by parties.
- Trustless: a decentralised service which does not require trust versus a single entity to be used by parties.
- Frictionless: a decentralised service exposing less usability and accessibility friction compared to an equivalent centralised service.
- Bordered: opposite of borderless, subjected to country border regulations and restrictions.
- Borderless: opposite of bordered, not subjected to country border regulations and restrictions.
- Asset: any valuable physical or digital non replicable object.
- Crypto Asset: an Asset that can be represented on a Blockchain.
- Fiat Currency: any country / area emitted currency (EUR, USD, …).
- Cryptocurrency: a currency existing on a Blockchain Network.
- Token: a generic Crypto Asset which is not currency.
- Utility Token: a Token representing a utility (allows to use an infrastructure).
- Security Token: a Token representing a security (allows to ear value from the possession).
- Equity Token: a Token representing an equity (a security providing also governance rights).
- Stablecoin: a Token providing a stable value, usually collateralised with Fiat Currency.
- Bitcoin: the first blockchain, launched by Satoshi Nakamoto in 2009.
- Ethereum: an Altcoin that is both a Cryptocurrency and a Utility Token enabling the usage of its own Network.
- Consensus: an algorithm used among peers in a Network to continuously agree on a common state.
- Fork: a controlled or accidental event causing the creation of alternative versions of concurrent Blockchains in the same Network.
- Soft Fork: a change in protocol generating Transactions that are compatible with the previous version of the protocol.
- Hard Fork: a change in protocol generating Transactions that are considered invalid from the previous version of the protocol.
- 51% Attack: an attack to a Consensus algorithm performed by Network nodes controlling at least the 51% of Consensus power or stake.
- Double Spending: the most common attack that can be performed in a 51% Attack scenario: consists in revoking one or more previously confirmed transactions.
- Blockchain: used both to address a decentralised Ledger Network or the data structure of a decentralised Ledger arranged as a list of blocks of transactions.
- Block: logic grouping of transactions chained in a Blockchain.
- Block Explorer: an online, usually web tool, to inspect Blockchain data.
- Confirmations: or depth of a Block, the number of newer Blocks built on top of a given Block, the more in depth, the more is confirmed.
- Genesis Block: the first Block of a Blockchain.
- Coinbase: the payload of a Genesis Block.
- Transaction: a value transfer from a set of input addresses to a set of output addresses.
- Transaction Fee: a fee paid by a Network user to incentivise Transaction validation.
- Address: a compact representation of a Public Key used to receive Transactions.
- Multisignature: a transaction locked with different Private Keys, required in combination to be unlocked.
- Wallet: a software to handle asymmetric keys to sign transactions.
- Mining: the process of reaching Consensus in a Network through the construction and verification of a new block using expensive computation.
- Cryptographic Hash: a function converting a variable size input in a fixed size output minimising the probability of conflict (different inputs generate the same output).
- Miner: an entity performing Mining operations (PoW).
- Hashrate: a performance index of a mining hardware (rig) in terms of hashes per second.
- FPGA: programmable hardware used in early algo-specific mining operations to reach high performances.
- ASIC: dedicated hardware used in algo-specific mining operations.
- GPU: Graphic Processing Using, commodity hardware used in high performance mining operations.
- Stake: an amount of blocked Tokens used as warranty by PoS validators.
- Holder: a holder of a Stake validating a PoS Network.
- Block Reward: the economic reward the protocol attributes to a Miner for mining a Block.
- Nonce: the random number to be computed to validate a Block that is added to the block header until a hash with target Difficulty is found.
- Difficulty: an adaptive index specifying how complex is to mine a Block.
- DLT: Decentralised Ledger Technologies, a superset of technologies including Blockchain and DAG.
- DAG: Decentralised Acyclic Graph, a technology to implement DLT without a chain of Blocks.
- Altcoin: common name for Blockchain projects derived from Bitcoin.
- Exchange: a Centralized service to exchange fiat and Crypto Assets.
- DEX: Decentralized EXchange, an on-chain implementation of a basic Exchange.
- Turing Complete: a programming language expressivity that allows to represent arbitrary complexity.
- On-chain: any code running in a decentralised fashion.
- Off-chain: any code running in a centralised fashion.
- Smart Contract: a (usually Turing Complete) on chain deterministic program able to manipulate Crypto Assets.
- EVM: the Ethereum Virtual Machine is a Turing Complete virtual machine able to execute Transaction bytecode.
- Dapp: Decentralised Application, any application which runs completely on-chain.
- DAO: Decentralised Autonomous Organization: any group of people acting together and coordinating through a Decentralized Application.
- DAC: Decentralized Autonomous Corporation, a for profit DAO.
- ICO: Initial Coin Offering, a crowdfunding method to finance a project by selling Utility Tokens.
- STO: Security Token Offering, a crowdfunding method to finance a project by selling Tokens representing securities.
- Merkle Tree: a data structure composed of hierarchical hashes that allows to quickly verify and demonstrate the existence of data inside a large dataset.
- PoW: Proof of Work, a Consensus method based on brute force computation.
- PoS: Proof of Stake, a Consensus method based on Token stakes.
- Hybrid PoS/PoW: hybrid PoS (holders) + PoW(miners) Consensus method.
- PoA: Proof of Authority, a Consensus based on Authority nodes that can sign Transactions, weight of an Authority usually is fixed.
- PoR: Proof of Reputation, a variant of PoA, where Nodes cumulate weight (reputation) through their work over time signing Transactions without objects. Reputation of an honest node increases over time.
- Asymmetric keys: a couple of keys that allow to demonstrate the ownership of a secret.
- Signature: a hash computed on arbitrary data using a Private Key and verifiable with a Public Key.
- Public Key: the key used to verify the ownership of a secret.
- Private Key: the secret used to sign data.
- Scalability: the ability of a Network to support more Transactions and reduce the confirmation time.
- Sidechain: a scalability solution based on sub chains depending on a main chain, able to transfer Assets among them.
- 2nd Layer: a scalability solution based on a off-chain layer operating on on-chain setup.
- Oracle: a Trusted bridge between the on-chain and off-chain world, providing input data for Smart Contracts.
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