Blockchain concept vocabulary
Blockchain core technology distributed ledger
A distributed ledger, also known as a shared ledger, is a database that can be shared, replicated, and synchronized among network members. Distributed ledgers record transactions between network participants, such as the exchange of assets or data.
Asymmetric encryption
The asymmetric encryption algorithm requires two secret keys, a public key and a private key, one for encryption and one for decryption. That is, Party A generates a pair of keys and discloses one of them as a public key to other parties. Party B, who obtains the public key, uses the key to encrypt the confidential information and then sends it to Party A. Party A then uses its own private key to decrypt the encrypted information, thus ensuring the security of the data.
Consensus Mechanism
The consensus mechanism is to complete the verification and confirmation of transactions in a short period of time through the voting of special nodes; for a transaction, if several nodes with unrelated interests can reach a consensus, we can think that the entire network can also reach a consensus on it.
PoW
Proof of Work is the consensus mechanism used by Bitcoin (BTC). The working principle is that each node in the network obtains the right to create the next block through its own computing power (computing power).
PoS
Proof of Stake is a system that distributes interest based on the amount and time you hold the currency.
DPoS
Delegated Proof of Stake, also known as the share authorization certification mechanism, each shareholder has corresponding influence according to the proportion of his shareholding. The result of the 51% shareholder vote will be irreversible and binding. The challenge is to achieve "51% approval" through a timely and efficient method. Similar to the parliamentary system or the People's Congress system.
Smart Contract
A smart contract is a computer protocol designed to communicate, verify, or execute contracts in an information-based manner. Smart contracts allow trusted transactions to be made without third parties, which are traceable and irreversible.
Blockchain types are divided into public chains according to their application scope
The public chain is a completely open blockchain, which means that anyone in the world can enter the system at any time to read data, send confirmable transactions, and compete for accounting. Public blockchains are generally considered "completely decentralized" because no individual or institution can control or tamper with the reading and writing of data in it. For example, BTC and ETH are typical public chains.
Private chain
A private chain refers to a blockchain whose writing permissions are controlled by an organization or institution, and the qualifications for participating nodes are strictly limited. Read permissions can be open to the outside world, or restricted to any degree.
Alliance Chain
A consortium chain refers to a blockchain that is jointly managed by several institutions. Each institution runs one or more nodes. The data in it only allows different institutions in the system to read, write and send transactions, and jointly record transaction data.
Permission Chain
It means that every node participating in the blockchain system is licensed, and unlicensed nodes cannot access the system. Therefore, private chains and alliance chains are permissioned chains.
Divide the main chain according to the deployment mechanism
The term main chain originates from mainnet, which is an officially launched, independent blockchain network.
Sidechain
The concept of side chain is relative to the main chain and is another blockchain parallel to the main chain. They establish associations through "two-way anchoring" and realize two-way transfer of value between the main chain and the side chain.
Blockchain Fork Hard Fork
A hard fork refers to when the Bitcoin code changes and the old nodes refuse to accept the blocks created by the new nodes. Blocks that do not comply with the original rules will be ignored, and miners will follow the original rules and create new blocks after the last block they verified. Such as Ethereum (ETH) and Ethereum Classic (ETC).
Soft Fork
Soft fork means that when the Bitcoin code changes, non-upgraded nodes can verify blocks produced by upgraded nodes, and upgraded nodes can also verify blocks produced by non-upgraded nodes.
Whitepaper
A white paper is a document about a new product or company that contains all the details: the problem the product will solve, technical specifications, roadmap, token distribution, team profile, and more. Bitcoin’s white paper is “Bitcoin: A Peer-to-Peer Electronic Cash System.”
ERC-20
ERC-20 is a protocol of the Ethereum network. ERC-20 tokens are created on the Ethereum (ETH) network through smart contracts. ERC-20 is a standard protocol for tokens. Describes the functions and events that this token contract must implement.
Token
Token is usually translated as a pass, which is also what we call a token. It represents a proof of equity on the blockchain, not a currency.