Blockchain Buzzwords: Common Blockchain Definitions
Accord Project – A non-profit, collaborative initiative for developing an ecosystem and open source tool for “smart legal contracts.”
Block Header – A summary of the data in the block.
Blockchain – A distributed ledger comprised of immutable blocks chained together to create an encrypted history of transactions.
Central Authority – An individual, organization or group which controls a permissioned blockchain.
Centralization (in blockchain) – A system in which control and decision-making is handled by a central authority, which may be an individual, organization or group.
Centralized (or Traditional) Database – A system in which data is stored in a single location.
Consensus – The process for determining the order in which blocks are added onto the blockchain and which nodes get to add the blocks.
Consortium Blockchain – A permissioned blockchain governed by a group of organizations.
Cryptocurrency – A virtual currency that is exchanged using blockchain.
Decentralization (in blockchain) – A system in which control and decision-making is handled by a distributed network instead of by a central authority.
Distributed Ledger – A system in which data is stored and shared across multiple sites, countries, or institutions.
Encryption – The encoding of information which converts the original representation of the information, known as plaintext, into an alternative form known as ciphertext.
Full node – A node that contains a complete history of the blockchain and which is responsible for validating blocks.
Hash – A string of characters that uniquely identifies data.
Hash (of a block in blockchain) – The hash of a block is a unique identifier for the block attained by performing a cryptographic function on the header of the block. A block stores the hash for the previous block to form a link between the two blocks.
Hybrid Blockchain – A blockchain controlled by a single organization, with a certain level of oversight performed by a public blockchain that is required to perform certain transaction validations.
Immutable – Unable to be altered.
Internet of Things (“IoT”) – Real world physical objects with embedded sensors, software, and other technologies that are used for the purpose of connecting and exchanging data with other devices and systems that are linked to the internet.
Light Node (or Lightweight Node) – A node that only stores block headers in order to validate transactions on the blockchain. Light nodes are dependent on full nodes to function.
Miner (or Mining Node) – A node that creates a block on a permissionless blockchain.
Natural Language – Ordinary speech or language (as contrasted with computer code).
Nodes – Computers, laptops, servers or other computer devices connected to the internet.
Non-fungible Token (“NFT”) – A digital asset with a unique identifying code, which represents real-world objects.
Permissioned Blockchain – A blockchain that requires permission from a central authority to join.
Permissionless Blockchain – A blockchain that does not require permission to join.
Private (or Managed) Blockchain – Permissioned blockchains controlled by owners.
Provenance – The origin of something.
Pseudo-anonymity – Designation of a user by a pseudonym whereby no actual identity information is revealed.
Public Blockchains – Permissionless, completely decentralized blockchains.
QR (Quick Response) Code– A type of barcode that can encode information like phone numbers or internet addresses, and can be easily read with digital devices such as smart phones or tablets.
RFID (Radio Frequency Identification) – A form of wireless communication that uses radio frequency waves to identify objects.
Smart Contract – A computer program that will perform a task when a pre-determined event is triggered.
Smart Legal Contract – A legally binding agreement that is digital and able to connect its terms and the performance of its obligations to external sources of data and software systems.
Smart Tag – An electronic label that contains a RFID device and/or barcode technology for the purposes of tracking and storing data.
Supply Chain Traceability – The ability to track the movement of a product forward through the supply chain from raw material to finished good and backward from finished good to raw material.
Validating a Block (or Validating a Transaction) – The act of verifying that data in a block comports with the rules of the blockchain.
