BLOCKCHAIN: Chapter 1a - Introduction P. 7 - 11

TRANSACTION

A business deal or action; exchange of money, goods, or services. Adding an entry to the network, which has validation control verify the proposed transaction.

SHAW-256

A common algorithm that generates an almost-unique, fixed-size 256 bit (32 byte) hash. A digital fingerprint of data that is used to lock it in place within the blockchain.

SHA (SECURE HASH ALGORITHM)

A cryptographic hash algorithm used to lock data in place within the blockchain and ensure security.

CRYPTOCURRENCY

A digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds. Is used to incentivize lots of users to facilitate the healthy function of the network through competition.

HASH

A finger print of data that was in the previous block and locks blocks in order and time.

CHAIN

A hash that links one block to another, mathematically "chaining" them together. It allows them to create mathematical trust.

BOCK

A list of transactions recorded in a ledger over a given period. The size, period, and triggering event for blocks is different for every blockchain. All block chains do record the movement of their cryptocurrency or token.

BLOCKCHAIN

An all-encompassing data structure with no one central control. A distributed database that a group of individual individuals controls and that stores and shares information.

PERMISSIONED BLOCKCHAIN

Distributed Ledger Technology (DLT), BUT roles that individuals can play within the network can be controlled. Their core code may or may not be controlled. i.e. Ripple.

PUBLIC BLOCKCHAIN

Distributed networks that are open for anyone to participate at any level and have open-source that their community maintains. There is no one central area of control. i.e. Bitcoin

SMART CONTRACT

Facilitate, verifies, and enforce the performance of a contract. There is no outside part or legal system that interprets the contract and the intent of the parties. The code/software gets put into the transaction and the program continues to execute as long as there is money.

HARDWARE

The full nodes that are securing the data in the network.

ALGORITHM

A step-by-step procedure for solving a problem, especially by a computer.

PEER-TO-PEER SYSTEM

A system with no central authority managing data flow while maintaining data integrity through a large distributed network of independent users.

PRIVATE BOCKCHAIN

Also known as distributed ledger technology (DLT) tend to be smaller and do not use a token or cryptocurrency. Membership is closely controlled. Usually they are consortiums that have trusted members and trade confidential information.

NETWORK

Composed of "full nodes" (computers running an algorithm that is securing the network. Each node contains a complete record of all transactions that were ever recorded in that blockchain.

THIRD EVOLUTION OF THE INTERNET

Deals with developing blockchain technology that addresses speed and data size constraints.

FULL NODES

Individual computers (world-wide) that make up the network that maintains data integrity.

ERC 20

Most popular smart contracts that allow for the generation of interchangeable tokens.

FACTOM NETWORK

Operates with federated nodes and an unlimited number of auditing nodes. These nodes (60 are trusted with ensuring the system. To hedge for security risks Factom anchors itself into other distributed networks to piggy back on the security of more extensive systems. It has faster transaction speeds and lower transaction costs than POW blockchains.

POS

Putting up tokens or cryptocurrency as a bond for processing transactions.

SHARDING

Sharding is a type of database partitioning that separates very large databases the into smaller, faster, more easily managed parts called data shards.

FORK CHOICE RULE

Splits the Ethereum blockchain into several parallel networks that will allow it to scale more efficiently and reduce the congestion on the network, increasing transaction speeds and lowering transaction costs.

SECOND EVOLUTION OF BLOCKCHAIN

The Ethereum network takes the traditional blockchain structure and adds several new programming languages that are built inside of it. It has over 10,000 full nodes and is globally distributed. Primarily used to trade Ether and create smart contracts.

SOFTWARE

The blockchain protocol that pays the hardware to operate and maintain the integrity of the network.

FIRST EVOLUTION OF BLOCKCHAIN

The original bitcoin network was built to secure the Bitcoin cryptocurrency and has around 5,000 full nodes that are globally distributed. It is primarily used to trade Bitcoin and exchange value, but it's also being used to secure other smaller blockchains and blockchain applications.

SINGLE POINT OF ENTRY

When a data base can be accessed through a single point. Most blockchains are not controlled by any single entity and do not have a single point of failure. All the entries are viewable by the whole network. When data is entered in a blockchain, it can't be removed. It's there forever.

51 PERCENT ATTACK

When records are changed inappropriately.