A participant of Peer-to-peer network. A peer acts both as a client and a server and all peers typically has the same privileges.
Peer-to-peer stands for a decentralized network where all participants (peers, nodes / miners) are directly connected with each other, as opposed through a central server.
A permissioned blockchain is a blockchain that is not publicly accessible and can only be accessed by users that have permission to do so. This access control offers increased security of blockchain systems like Bitcoin, as users are only able to take actions that blockchain administrators allow and must identify themselves digitally.
Plasma is the Lightning Network concept of the Ethereum blockchain. It is a framework to scale Ethereum blockchain’s processing power. A trust-less and multi-layered network that was developed to facilitate a decentralized market for the general public, to purchase not only cryptocurrencies and tokens but also real goods and services.
Private blockchains are developed and maintained by private organizations that control the mining process and consensus algorithm. They decide who can join the network and who may access the nodes, thus it is a closed network where blockchain permissions are held and controlled by a centralized entity.
The use of both Proof-of-Stake (PoS) and Proof-of-Work (PoW) consensus protocols on a blockchain network. Blocks are validated from not only miners, but also voters or stakeholders, with the intent to create a balanced network governance. The objective of hybrid Proof of Work and Proof of Stake systems is to maintain the benefits of the respective approaches and use them to balance each other’s weaknesses.
A private key allows to sign a transaction and spend funds residing in an address (public key) by providing ownership with the signature. It is a unique string of information that represents proof of identification inside the blockchain, which includes the right to access and control the participant’s wallet. It must be kept secret, as it is effectively a personal password.
Proof of Authority (PoA)
A consensus mechanism in a private blockchain that grants a single private key the authority to generate all the blocks. The Proof-of-Authority algorithm is an alternative to the Proof of Stake algorithm, but instead of staking cryptocurrency, the stake is identity. This means voluntarily disclosing identity in exchange for the right to validate blocks. Any malicious action taken by a validator will reflect on its reputation. PoA blockchains require a thorough identity verification process.
Proof of Stake (PoS)
An alternative to the proof-of-work system, in which participants earn the right to add new blocks and in doing so, earn new tokens, based on the amount of currency they are staking. In Proof of Stake system, miners stake cryptocurrency in order to increase the possibility of earning the right to validate a block and earn a reward. The amount of cryptocurrency at stake acts as a guarantee that the miner will validate the block according to the rules. If the miner violates these rules, the stake will be ‘burned’ or destroyed thus providing an incentive mechanism for honest behavior.
Proof of Work (PoW)
A proof-of-work system is a consensus mechanism that relates mining capability to computational power. The process involves repeatedly performing a hash function and it is the way miners earn revenue by adding blocks on the blockchain. When the Proof of Work algorithm applies, the first miner that provides a ‘proof of work’ for a block, can validate it and receive the block reward. This proof of work can be generated by repeatedly inserting transaction data, together with a random string of digits into a hashing formula, until a desirable outcome is found called the proof of work. Other miners can validate the proof of work by taking the alleged input string and applying it to the same formula to check if the outcome is indeed that what was presented. The systemdeters denial-of-service attacks and other service abuses such as spam on a network by requiring some work from the service requester, usually meaning computational effort from a computer. Blocks must be hashed, which is an easy computational process, but an additional variable is added to the hashing process to make it harder. When a block is successfully hashed, the hashing could only be achieved with time and computational effort. Thus, a hashed block is considered proof of work. The most widely used proof-of-work scheme is based on SHA-256 and was introduced as a part of Bitcoin.
It is generally a set of rules or customs of a group or standard procedures for what actions to take in a certain situation.
A public blockchain is a type of blockchain where anyone may take part in transactions, execute consensus protocol to help decide which blocks get added to the blockchain and access a copy of the shared ledger, having equal authority as everyone else on the network. It is a “Public” network in a sense that you do not need permission to access it, just internet access and software.
A public key is created in public key encryption cryptography that makes use of asymmetric-key encryption algorithms. It is a unique string of information that identifies a participant within the blockchain. It can be shared publicly. A public key is your wallet address and is required by other entities, in order to send you messages or transactions.