A guide to terms and concepts that define blockchain and crypto-coins.
This glossary was written to help beginners understand the main and most recurring terms and jargon used in the digital asset segment.
The terms are in Portuguese and English. To facilitate the search, look for the concept that you want to know the definition with the function Ctrl + F of your keyboard.
Altcoin: generally refers to any crypto-currency other than bitcoin. In a way, this denomination has become obsolete because bitcoin is losing market share to other crypto-coins.
51% attack attack: Open blockchain protocols are vulnerable to attacks that could take advantage of the need for consensus. If miners are able to control 51% of the nodes that operate the network, they can manipulate fundamental rules and take control of the system by adopting their own code changes and replacing the need for others involved in the system to agree to those changes before they are implemented.
Digital Assets: Describing a crypto-currency simply as currency is considered an impoverished way to explain what emerging digital assets are. The term criptomoeda can be a bit confusing (since, to a certain extent, digital tokens do not satisfy all the money functions). Instead, naming crypto-coins as digital assets translates into better intrinsic value of these instruments.
Multi-sig: refers to a crypto-currency address that requires more than one private key to transfer funds. The multiple signature function is commonly used in business transactions in which a company does not want only one person to have the keys to an address. It is also used in transactions made through escrow or when applications require extra layers of security.
Whale: is a person or entity that has an important position, or a large amount, in crypto-coins. Whales can influence the price when they sell. As the crypto-coins mature, or the market cap of them increases, it is possible that whales have a smaller influence on the price fluctuations of digital coins.
Network fork (fork): division into code that supports the blockchain system. The blockchain can be bifurcated for a variety of reasons: from planned code updates to full system change scenarios. Soft forks refer to planned code updates or changes that do not change the base structure or operation of the blockchain system. A complex fork of the network (hard fork) is a change that can have considerable impacts on blockchain and related currencies. Complex network bifurcations are difficult to implement, and due to the need for consensus to manage decentralized networks, such as bitcoin and ethereum, can result in two different networks.
Blockchain: it is a technology that aims at decentralization as a security measure. They are distributed and shared records and data bases that have the function of creating a global index for all transactions that occur in a particular market. It functions as a reason book, only in a public, shared and universal way, which creates consensus and trust in direct communication between two parties, that is, without the intermediary of third parties. It is constantly growing as new complete blocks are added to it by a new set of records. Blocks are added to the blockchain in a linear and chronological way. Each node - any computer connected to this network has the task of validating and forwarding transactions - obtains a copy of the blockchain after joining the network. The blockchain has complete address and balance information directly from the genesis block to the most recently completed block. The blockchain is seen as the main technological innovation of bitcoin since it is the proof of all the transactions in the network. Its original design has served as inspiration for the emergence of new crypto-coins and distributed databases.
Digital wallet (wallet): vital part of the crypto-coins system and something that users need to have familiarity to safely store their digital coins. Cryptotomes are drawn using public and private cryptographic keys. The public key is a unique series of letters and numbers that is visible to all and can be identified in the blockchain. The private key is held only by the custodian of the digital currency and is required to access funds and complete transactions. That is, the public key can be shared with other people for the purpose of, for example, receiving funds. The private key can never be revealed or stored digitally, as it can be stolen by hackers. There are several types of wallets, including paper wallets and wallet-devices (hardware wallet) that are used to store digital coins offline. These two examples are considered cold storage forms (cold storage or cold wallet). On the other hand, the form of hot storage (hot storage or hot wallet) is a wallet that can be accessed online, which facilitates transactions, but can be vulnerable to attacks. A digital wallet on your phone is an example of a hot wallet.
setembro 20, 2017
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