.webp)
Blockchain Guide
Blockchain
A blockchain is a decentralized, digital ledger that records transactions across multiple computers in a way that ensures the data is secure, transparent, and immutable. Each transaction is stored in a "block," which is linked to the previous block, forming a "chain."
Decentralization
Decentralization refers to the distribution of authority, data, or operations away from a central entity or authority. In blockchain, it means that no single entity controls the entire network; instead, control is shared among all participants (nodes).
Node
A node is a computer or device that participates in the blockchain network. Nodes can validate transactions, store data, and contribute to the security of the network by running blockchain software.
Consensus Mechanism
A consensus mechanism is a process used by blockchain networks to agree on the validity of transactions and maintain network integrity. Common consensus mechanisms include Proof of Work (PoW), Proof of Stake (PoS), and Delegated Proof of Stake (DPoS).
Smart Contract
A smart contract is a self-executing contract with the terms of the agreement directly written into code. Smart contracts automatically enforce agreements without the need for intermediaries, making processes more efficient and secure.
Cryptography
Cryptography is the practice of securing information through encoding so that only authorized parties can access it. Blockchain uses cryptographic techniques to secure transactions and control the creation of new units (e.g., cryptocurrencies).
Hash
A hash is a cryptographic function that converts data into a fixed-size string of characters. In blockchain, each block contains a hash of the previous block, making it tamper-evident—any attempt to alter the data will change the hash and break the chain.
Mining
Mining is the process of validating and adding new transactions to the blockchain, typically associated with Proof of Work (PoW) blockchains like Bitcoin. Miners solve complex mathematical problems to validate blocks, earning cryptocurrency rewards for their efforts.
Immutable Ledger
An immutable ledger is a database or record that cannot be altered once information is recorded. Blockchain’s structure ensures that once a transaction is added to a block and confirmed by the network, it is nearly impossible to change.
Token
A token is a digital asset created and managed on a blockchain. Tokens can represent ownership, rights, or access to services. Utility tokens provide access to a product or service, while security tokens represent ownership in an asset like equity or real estate.
